By: Erica Salmon Byrne
This article originally appeared in the Society of Corporate Compliance and Ethics’ magazine, Compliance & Ethics Professional, May 2016 edition.
BYRNE ON GOVERNANCE
In March, the Ethisphere Institute and Kroll released “The 2016 Anti-Bribery and Corruption Report,” summarizing the results of survey work conducted earlier in the year. The survey included responses from over 260 compliance and ethics professionals on their anti-bribery and corruption risks.
It sought to gather data on program practices, perceptions of risk, the scope of third-party due diligence, and much more. The findings were diverse, but one particularly stood out to me: The level of reported engagement in the program from executive leadership and the board and the impact that engagement had on respondent perceptions of preparedness and risk.
Respondents to the survey reported increasing levels of engagement from all facets of the executive team, with 47% reporting
that their leadership was highly engaged and 44% reporting they were somewhat engaged. Over half (54%) reported their board played an active role, and 48% said the same of their CEO. Respondents reported 86% of CFO’s had a leading role in the program, which likely reflects the increased focus the Securities and Exchange Commission has placed recently on books and records violations.
These are heartening numbers. They represent a tremendous development in providing a strong tone at the top and support for an effective program. And, not surprisingly, the more engaged the board and leadership team were at a company, the more likely the respondents were to say they believe their anti-bribery and corruption risk will decrease or remain the same in the coming year.
Amongst the respondents who said their leadership team and board were not engaged, 75% believed their anti-bribery and corruption risks would increase in the coming year.
Conversely, 56% of those respondents whose leadership teams were engaged said their risks would remain the same this year, and 7% actually predicted a decrease. This dichotomy demonstrates the impact that an engaged leadership team can have. Note that these respondents faced the same global environment, the same daunting universe of third parties, and yet we can draw a definite correlation between these two data points. Leadership does matter.
Of course, it’s not entirely a good news story. A substantial number of respondents still cannot say whether their board (33%) or own CEO (26%) is involved in their anti-bribery and corruption program, leaving considerable room for improvement in this critical area.
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