Busting graft: Tone from the top is key
26 January 2015
Business Times Singapore
THIS WEEK’S TOPIC: How can CEOs build and sustain a graft-free corporate culture in today’s business environment?Mike Muller
President, Asia Pacific
THIS is a subject about which I am passionate and relentless – as my staff across APAC will tell you. First and foremost, CEOs must lead by example and demonstrate the very highest standards of integrity. As leaders, we set the tone for the whole organisation. At Avaya, I do that in a number of ways. Firstly, it is something we as a company communicate about openly and regularly with all employees. It is the very basis of my cultural DNA for the organisation, and I use my regular newsletter and town hall meetings to reiterate the message. I hold all my leadership team personally accountable for the integrity of their teams. Every employee in the organisation must follow a training programme and reaffirm in writing their commitment to our ethics and compliance code annually. And there is a zero tolerance policy in place.
Personal and professional integrity are the foundations upon which we build our business. I often quote US politician Alan Simpson who sums it up neatly: “If you have integrity, nothing else matters. If you don’t have integrity, nothing else matters.” We are all in the business of growing our revenues – but at Avaya we will never do that at the expense of our integrity or our reputation.
Tata Consultancy Services
THE CEO needs to set the tone in an unambiguous manner that the company would have zero tolerance towards graft in any form. He or she should be prepared to walk away from an opportunity rather than use graft as a means to the end. This message must be embedded into the operations by asking employees to sign a declaration or undertaking not to engage in any activity that is perceived as graft, and for total compliance to legislation on the subject. Lastly, the message must be reinforced periodically in team meetings. Over time, every employee will be clear that the only way to do business in the company is the righteous way.
Thye Kim Meng
Darco Water Technologies Ltd
IF more people think about what real success means, they shall be less tempted to take the easy path.
In a way, corruption is like drug cheating in sports. Some do it and some don’t. Those who don’t would not want to achieve success in any other way. They believe in their talent and want to prove it the only way they know – ie through training.
In business, I would say that you should not buy success. It will take away real motivation, as a result of which you will not be able to garner all your energies into getting the business fundamentals right and achieve long-term success.
In my experience, it is very rare that I come across a customer’s employees soliciting bribes. But the same cannot be said about suppliers offering bribes to get business. More must be done, therefore, to punish those who offer bribes, levelling the playing field for clean and honest businessmen.
Bosch Southeast Asia
AT Bosch, our corporate values of respecting and observing the law, and our code of conduct are the driving forces behind our sustainable business practices. Our zero-tolerance towards corruption is reflected on several fronts, including a strong tone at the top, and strict, precise guidelines and processes that govern the behaviour of every Bosch associate.
The words of our late founder Robert Bosch still hold much relevance today: “In the long term, an honest and fair approach to doing business will always be the most profitable.”
Much like the approach of the Singapore government, resources need to be allocated and dedicated to combat corruption. Apart from internal audits and the worldwide installation of compliance officers, Bosch further set up an independent compliance organisation that reports directly to the board of management to ensure corporate governance. Compliance awareness is generated through campaigns, as well as mandatory training via classroom and Web-based platforms. Most importantly, we maintain open communication channels to consult on compliance challenges, or to report breaches through a hotline with the option to remain anonymous.
IT is important to maintain a zero-tolerance stance both internally and externally. At Henkel, we run compliance trainings regularly, with up-to-date dos and don’ts on how our employees are required to act and engage in general, with the market.
A graft-free environment in the workplace is possible when employees have belief and passion in what they do. I believe that knowing that your contributions make a difference, and receiving recognition for your efforts will deter one from seeking other forms of gratification elsewhere.
At Henkel, we ensure that what we do is meaningful in upholding our vision to be “a global leader in brands and technologies”. We inspire our employees by showing a clear commitment to their development, and offer competitive compensation and reward programmes that are strongly linked to performance, as well as attractive career development opportunities in different businesses.
THE CEO has to consistently and frequently articulate and ingrain into his staff the values that his organisation stands for. The CEO has to set the tone, walk the talk and ensure that senior management of the company does likewise, so that this integrity culture will permeate through the entire organisation.
In addition, there must be a robust prevention, detection and reaction system, so that staff at all levels understand and observe zero tolerance for graft. Employees in Siemens are encouraged to speak up and inculcate the compliance spirit.
Today, our internal control mechanisms are among the best in the world. Our compliance system has now developed into an integral part of our sustainability initiative. We are very proud that this initiative has consistently reached the highest score in the Dow JonesSustainability Index.
Compliance has become a top priority for Siemens with our core values of being “Responsible, Innovative and Excellent”.
Chief Executive Officer
THE tone from the top is instrumental in building this foundation, and it is important for the board and the management to promote a sound corporate governance culture that permeates throughout the entire organisation. Organisations cannot afford to ignore this and are increasingly embracing a more risk aware culture, with a set of values, beliefs and understanding that if they do not manage risk properly, it may then lead to inappropriate actions by individuals. Clear and consistent communication of the organisation’s values to the employees is a key step in managing risk.
The next step is to appoint a risk officer to proactively manage risk issues and police the company activities. The use of data analytics capabilities can also prove useful, because they can help the organisation monitor transactions in a timely manner and pick out abnormalities that might signal a problem. Another good mechanism is a whistleblowing hotline where employees can raise their concerns anonymously.
Ruder Finn Asia
MODERN business practice and public expectations oblige corporations to go further than the black letter of the law in their operations and their community engagement. Responsible corporate governance requires that appropriate systems are put in place to manage reputation risks as well as financial and human resource obligations. This is not just the legally and morally right thing to do; social media is ensuring a level of transparency that makes it a business imperative.
For those reasons, corporate governance needs to include the whole gamut of reputation management to guard against illegal or corrupt practice. This goes beyond ensuring due diligence in financial transactions and needs to extend to a cognisance of government priorities and a willingness to support government initiatives as they apply to commercial operations.
Most importantly, a company needs to create an internal culture that recognises and rewards good behaviour by building a culture of accountability at all levels and ensuring best practice in its code of conduct and business behaviour. There is no cookie-cutter solution, and local solutions need to take into consideration local cultural and regulatory environment to be successful.
Leong Soo Yee
THE board and CEO must lead by example and set the tone from the top to cultivate a culture that encourages, requires and rewards enquiries that challenge existing conditions. Developing a company-wide “challenge culture” for risk management and oversight is the next logical evolution for boards and C-suite executives as they seek to reduce risk in their organisations in today’s business environment.
In order to maintain Singapore’s reputation as one of the least corrupt countries in the world, CEOs must develop and implement robust whistle-blowing policies and good compensation systems to deter any illegal activity, while maintaining high standards of corporate governance and ethics for their businesses. They should also ensure that all their employees undergo the requisite educational and training programmes that will equip them with a solid understanding of business ethics and the consequences of wrongdoing.
CEOs should also regularly consult industry experts to ensure that they are up to speed with the latest best practices on how organisations can prevent fraud and corruption in global businesses.
Singapore’s government can also continue to support corporations in their efforts to eliminate the threat of fraud and corruption by defining clear legal consequences, enhancing the penalties for such activities and ensuring effective enforcement.
Tham Sai Choy
Managing Partner, KPMG in Singapore and
Chairman of KPMG Asia Pacific.
WHEN it comes to preventing corruption, the tone from the top is key. But tone should not be mistaken as implying that communications alone is sufficient; management involvement is essential. CEOs need to take the lead to ensure that employees, management and even business partners understand and meet the expectations of the company.
Regulatory expectations are that senior management will commit to oversight and monitoring of corporate conduct, and react decisively and appropriately to incidents. CEOs know that to fail in this respect is to leave their companies exposed to potentially ruinous consequences. The top 10 penalties paid by companies for alleged breaches of the US Foreign Corrupt Practices Act adds to a staggering US$4.4 billion – and only two of those 10 were paid by US-based companies. CEOs must see to it that everyone in their organisation understands the financial and reputational risks of failing to prevent bribery and corruption.
Walton International Group (S) Pte Ltd
SUSTAINING a graft-free society in any country requires the collective effort of the government and the corporate sector. Singapore has attained a solid reputation for its intolerance for corrupt practices. It is quick to take to task its public servants regardless of seniority or rank and shame them in the public domain through the courts and media. Accordingly, it has earned a commendable seventh position in the Corruption Perception Index 2014 by Transparency International.
The corporate sector too has to play its part. Corporations worldwide that have no conscience have committed a myriad of illicit activities such as exploiting tax laws, rigging bids to win contracts, abusing legal loopholes, hiding corrupt acts behind secret subsidiaries, paying bribes and money laundering. Fortunately in Singapore, thanks to our government’s vigilance against corruption, such malpractices are not extensive. However, the fight against corruption is an ongoing one. To promote greater private sector integrity, CEOs have to establish within their organisations strong internal controls, conduct regular audits, institute code of conduct/ethical behaviour, a strong framework for corporate governance and perhaps also introduce a whistle-blowing policy as a self-check mechanism.
Managing Partner, Asean and Singapore
Ernst & Young LLP
THE CEO must make it unwaveringly clear that “clean” business is business, and ethical conduct and growth are not mutually exclusive, particularly when employees or third parties in the supply chain are tempted to behave unethically to achieve business objectives. The CEO must also demand clear accountability from management and team leaders on compliance with fraud policies, given that EY’s Global Fraud Survey had shown some disconnect between theory and practice. Talk on proactively managing fraud risks must be supported with appropriate investments in internal audit and compliance functions; technology and tools such as forensic data analytics; and organisational-wide training and education, given that every employee is a potential whistleblower. Demonstrating a commitment to better engage with the board on anti-fraud enforcement will also elevate the agenda and instill a more pre-emptive culture that permeates the organisation from the top to bottom, consequently raising deterrence among all including the C-suite.
Ministry of Foreign Affairs
“THE fish rots from the top,” goes the saying. The CEO must himself, as well as his top team, by word and by deed, set the example of wanting a corruption-free culture within the organisation. It has to go beyond simply crafting a Code of Ethics. It has to be an organisation-wide initiative encompassing training at all levels, surveying staff, putting in place procedures, appointing “integrity champions” etc, so that the ethos of integrity gets into the DNA of the organisation.
Lars Mikael Jensen
Maersk Line, Asia Pacific Region
ONE of the most serious risks that we face as a global business is corruption. Companies need to cooperate with governments, non-governmental organisations (NGOs) and other business partners to counter this worldwide issue. At Maersk, we are participating in industry-wide collaborations such as the Maritime Anti-Corruption Network.
Being a leader, it is important to set the tone from the top and make it clear that corruption will not be tolerated. Management focus to consistently address this and to improve business process controls is essential. This helps to minimise opportunities for corruption, and enables malpractice to be quickly identified. There must also be support for local management to take the tough and right decisions if any cases are discovered.
Staff should feel comfortable and confident that if they report a potential corruption case, for example through the whistle-blower system, it would be properly investigated with adequate follow-up action.
Besides our anti-corruption programme for all staff, we have regular briefings in each country on fraud and corruption issues. With rising government scrutiny in countries such as China on how companies conduct business, it is increasingly crucial to demonstrate compliance with all relevant laws.
Low Lee Yong
MHC Asia Group Pte Ltd
ONE cannot run away from the fact that greed is timeless, and that people will always try to cheat the system. Having said that, responsible business owners know that it is in their organisations’ best interests to make sure that corruption is kept in check, because fraud can bring down a business overnight, especially one like ours that is built on trust, transparency and fairness.
Prevention starts even before an employee steps into the company. It is important to hire based on integrity and not just on intelligence; the candidate should have a vision beyond just dollars and cents, with a heart for doing good. Anticipate potential areas of vulnerability and put in place checks and balances to eliminate temptation. Also look out for employees who are in need, such as those in debt and struggling financially – provide open channels for them to seek help.
Founder & CEO
THERE is no such thing as a universally good corporate culture that fits every business in every stage of its development. Nothing is obvious or common about it – for example, in most situations transparency is good, but in some cases secrecy is the only way to go forward; in some cases, risk taking and being ready to make mistakes is needed and in others, one must force people to make only safe decisions.
And so the first thing is to understand which culture you need and are able to establish in your company. The second thing is to have a staged plan on how to get there – the best book I have read about it is Tribal Leadership (http://www.amazon.com/Tribal-Leadership-Leveraging-Thriving-Organization/dp/0061251321) which describes that one cannot jump from what he gets to where he wants to be in terms of corporate culture.
And finally one should be ready to change or adjust the structure over time and in different geographies. There are many ways to establish company culture – some of it dictated by personal preference and abilities (I like to lead by example), and some by the objective context of the situation.
THROUGHOUT our many years of experience advising companies and boards, we have found a low tolerance for corruption in Singapore, thus the few incidents that are uncovered are individual and isolated, rather than systemic. The challenge is thus to maintain such high standards while guarding against complacency.
The greater challenge is for the many companies that conduct business overseas where the resistance to a culture of commission and kickbacks is less stringent. Companies must thus instil good governance among their staff, yet maintain a competitive edge. Under the current regulatory regime, even acts committed overseas are open to scrutiny, which is a constraint not all our competitors from other countries are subject to.
Mark Billington FCA
Regional Director South East Asia
FIRSTLY, it is important for management to clarify what integrity means for the organisation. CEOs, boards and senior management must provide clear guidance on the standards of behaviour expected from their employees and partners, and also develop a culture within the organisation that promotes and sustains integrity. Some examples of this include ensuring that senior management set a good example and show that they are not willing to allow short-term gains to triumph over integrity; avoiding unrealistic performance targets and objectives that encourage behaviour that lacks integrity; having a system which monitors and disciplines employees who do not meet ethical standards; and creating a culture which promotes and encourages staff to voice any concerns without fear of retribution.
Developing an ethical corporate culture requires time, resources, strong leadership and continued monitoring and oversight – but it is fundamental to the long-term performance and reputation of an organisation. For companies that would like to find out more about how they can incorporate integrity within their organisations, ICAEW has published a framework titled Instilling Integrity in Organisations, which is available free on our website.
Seah Kian Peng
NTUC FairPrice Co-operative Ltd
THE issue of corruption is a complex and multifaceted problem that may often be exacerbated by weak corporate governance and absence of proper accountability. The malignant effects of corruption not only affects the organisation’s integrity and reputation but also disrupts efforts in carrying out its core functions and services.
NTUC FairPrice takes a serious stance against corruption, and has an established internal framework for preventing and detecting violations as well as to uphold ethical standards. For example, our Internal Audit (IA) department functions independently as they evaluate and improve the effectiveness of risk management, control and governance processes. Apart from auditing, monitoring and ensuring compliance, our IA department also looks into ways to reduce costs and wastage, and improve processes. By doing so, we see IA’s role serving more as an assurance function rather than one of compliance.
Other measures include the rotation of staff duties, and stringent policies on declaration and acceptance of entertainment and gifts. We also assure confidentiality through our whistle-blowing hotline. By doing all this, we strive to ensure a high level of compliance and integrity within our organisation.
Lim Soon Hock
Plan-B ICAG Pte Ltd
STRENGTHENING the legislation and making it easier for whistle-blowers to make complaints will help. Ultimately, it is about leadership enforcing the discipline and setting the example. There must be no exception – leaders must walk away from any deal, no matter how attractive, that will compromise the company’s ethical business practice. If I have to make a choice between failure – ie not delivering my numbers – and compromising on ethical practice, I would opt for the former. My grandfather taught me that success and wealth must be earned honestly and lawfully.
Time often catches up, as has been shown by several high profile cases, including a former minister, in Singapore. Companies should be held “vicariously” liable for any acts of corruption by employees. It is not good enough to have policies in place – all those in leadership positions must walk the talk. This should also extend to businesses in foreign markets, inter-related party transactions and conflicts of interests, where often a company’s graft-free culture can be easily compromised.
CEO, Asia Pacific
CEOs can focus on the integrity risk “CSR”: culture, strategy and resources.
Culture: A clear CEO message about corporate ethics needs to address any well-intentioned but potentially risky “bring me solutions, not problems” operational culture. Graft is asymmetric, evolving and involves high stakes; it is a problem that benefits from shared solving. CEOs can set that consistent and supportive cultural tone.
Strategy: The CEO can help fuse corporate strategy with integrity reality. Is 40 per cent growth in a market where you are facing graft issues and use only third parties realistic? CEOs can define strategies and models that segment markets by risk and opportunity.
Resources: Resisting graft needs to be every employee’s responsibility, but they need training, tools and support. The compliance function can be legislator, policeman, educator and counsellor, but not all in one. CEOs can make those resources available.
UPS Asia Pacific Region
AS a company that moves 2 per cent of global gross domestic product (GDP) throughout our network at any given time, customers expect us to operate in a fair, honest and ethical manner and lead by example as we comply with laws and regulations. These expectations are communicated to all UPS employees through a written Code of Business Conduct with guiding principles that set standards of integrity as we engage with customers, shareowners, communities and each other. Globally, all employees are assessed and rated annually on ethics and integrity as we believe that compliance builds trust, which in turn builds strong business relationships.
These ingrained principles are frequently reviewed in internal meetings. In Asia, a cross-functional Business Risk and Compliance Committee convenes monthly to discuss relevant industry and country compliance risks and opportunities, putting necessary measures in place to address concerns and guide us in doing the right thing in every business situation.
THE more “social” business becomes, the less corrupt it can be. Social media is the key to creating commercial communities of the highest character where ideas are solicited, standards are shared and rules are enforced. Corruption tends to lurk in the shadows, where social media exposes and illuminates. Social media should therefore be a fundamental part of corporate communication, shaping company culture, which determines whether or not there is an environment conducive to corruption. Co-creation through conversations with employees is essential, with openness and transparency not just reasonable expectations but everyday realities of how a business thinks and works. Social media is taking a wrecking ball to the old walls separating previously distinct business functions where graft could fall through the cracks, and is the one platform that can cut across entire enterprises and industries and create a new rallying point against corruption.
PeopleWorldwide Consulting Pte Ltd
BUILDING an ethics-driven business culture is easier said than done. The values must be distilled and instilled into every individual within the organisation, starting from the very top.
What amount of entertainment or interaction between parties on deals is considered appropriate or remotely graft-free? It could be a bit subjective. When in doubt, refrain.
In PeopleWorldwide, we choose the straight path of business dealing. We win projects and jobs on the merits of our professional work and dedication, and not with entertainment and gifts. This way, we become predictable and clients expect that we act honourably, responsibly and reliably on the job.
This no-frills, no-nonsense culture must start from the top. There is a saying in Chinese – “shang liang bu zheng xia liang wai” – when the upper beam is not straight, the lower ones will be slanted.
James K W Wong
O E Manufacturing Pte Ltd
CORRUPT intent starts developing from a person’s inner self. Laws can have a deterrent effect to some extent; nursing the inner self can add another dimension to character building. The inner self refers to a person’s integrity and sense of fair play. These values must be cultivated from young, at home and in school. Honesty and fair play must be stressed. Fair play refers to rule-abiding behaviour and actions that produce equal benefits for all. The old belief that high pay will keep corruption away is not too relevant in today’s Singapore, where erstwhile kampung boys are happy with what a high salary can buy. Affluence has brought about new desires and draws beyond a handsome salary.
Lee Fook Chiew
Chief Executive Officer
Institute of Singapore Chartered Accountants
AT the minimum, CEOs should lay down a robust corporate code of conduct and ethics with clear guidelines on the company’s policy towards bribery and corruption. CEOs should also ensure that there is effective communication and proper training for staff to understand the significance of conducting business ethically.
Tone from the top is vital. CEOs must “walk the talk” and show their preparedness to decline lucrative contracts that may involve corruption or bribery. CEOs should closely monitor and supervise operations, especially those overseas, and demonstrate their determination by blacklisting business contacts that engage in corrupt practices. In order to sustain a graft-free corporate culture, it is equally important for CEOs to have in place a compensation framework that does not overly emphasise short-term gains to encourage unethical actions.
FIRST and foremost, there must be clear accountability and transparency in terms of systems and processes. One way is to implement diagnostic tools to assess the integrity of internal systems and identify corruption vulnerabilities. This will help to ensure proper checks and balances in all the systems, especially with regard to finance and supply chain purchases.
For example, the system must be able to identify and prevent bribery risks when it comes to dealing with suppliers or tenders and bids. Another example of an anti-graft measure is how banks institute forced leave for certain positions in order to conduct checks and see if flaws surface when the person is not around, because it is easy to cover up corrupt practices if the person is always around.
Once the necessary system is in place, it should be benchmarked and monitored at regular internals to ensure compliance and make improvements where appropriate. In general, the CEO must create a culture in which clear accountability is inculcated into every worker as well as a culture that protects whistleblowers. Finally, the senior management of higher risk and larger organisations may consider commissioning external parties to audit the effectiveness of the firm’s anti-corruption processes, financial documents, etc.
The Institute of Internal Auditors Singapore
A GRAFT-FREE corporate culture should start with the tone at the top expressly stating the business’ stand on ethical behaviour and the severe penalties for breaching it. A code of conduct should be established, and include anti-bribery and anti-corruption policies endorsed by the board of directors. Employees can be made to sign a declaration stating that they will abide by this code; if not, they will face the necessary penalties.
In managing risks and controls, management control forms the first line of defence. The various risk management control and compliance functions are the second line of defence established by management to monitor the first line of defence. Internal audit, as the third line of defence, provides independent assurance of the effectiveness of the first and second lines of defence in preventing and detecting fraud.
Organisations should test their lines of defence regularly and also review them to keep up with new developments in crime.
SAS Institute Pte Ltd
IT starts with a strong code of ethics and integrity, with a very low tolerance for deviation.
Corruption manifests in many ways and varies from those with criminal intent, to unwitting lapses due to ignorance. It is difficult to sift out the suspicious activities as they could be camouflaged through the volume of data, internal procedures and rules; it is also difficult to detect relationships that are irregular. Fraudsters are often insiders, making it challenging to use business rules alone to detect irregularities as their modus operandi evolve with time.
For issues that carry heavy financial and reputational consequences, a straightforward approach such as increasing manpower for supervision and monitoring will not address corruption effectively. We need to be able to detect fraud quickly and investigate more effectively. A hybrid approach combining business rules and robust analytics engines tackles the core of the problem through the ability to scan massive volumes of transactions. With a properly-tuned analytics system, we can review prioritised alerts and investigators can then triage effectively and form an effective deterrent to combat corruption.
PrimeStaff Management Services Pte Ltd
I CONCUR with Prime Minister Lee Hsien Loong that it is unrealistic to expect the problem of corruption to disappear completely. Having said that, we should do our best to put the right anti-corruption measures in place and promote best practices. It has to come top-down. The CEO, together with senior management, needs to build a strong corporate culture anchored on core values such as integrity, ethics, honesty and accountability. There should also be a keen emphasis on the practice of transparency within the work environment. Besides these, leaders should ensure that a “safe” environment is created where whistleblowers feel safe to come forward. Finally, hiring the right individuals is important. This is especially so for senior positions that entail key decision-making. Organisations should conduct a very comprehensive screening process and hire individuals who display a strong value system.
Best World International Ltd
ALTHOUGH Singapore is relatively graft-free, we must not take it for granted that it will always be so. It takes a person with a very high set of values and integrity to stay honest, as opportunities for corrupt wrongdoing abound when doing business. It is not easy to maintain high standards when dealing with business partners who may not hold the same values, especially overseas.
However, we can help build and sustain a graft-free corporate culture within our own working environment by passing on the right values to the next generation, including fostering anti-graft awareness at the regional level.
Corruption and bribery usually take place in a weak operating environment. Therefore, besides having a robust accounting system, it is important to curb corruption by ensuring that standard operating procedures (SOPs) are clearly defined, observed and vigilantly checked. Regulating how the business is run and fostering ethical business dealings at every opportunity is crucial.
Have good transparency and demand accountability from senior managers for compliance purposes.
Senior managers need to make it clear throughout the business that bribery will not be tolerated, and they should be personally involved in making sure that proportionate steps are taken to prevent bribery, with adequate procedures in place.
Director, Business Support,
SKF Asia Pacific Pte Ltd
MUCH has been done to eradicate corruption in Singapore since the People’s Action Party government came to power. Corruption is rampant across much of Asia. In this context, Singapore has done well and has been recognised globally. Not only is corruption well handled here, we have built into our people the graft-free mindset and way of life. Companies around Asia recognise that Singaporeans are “well brought up” in this ethos and would be willing to hire Singaporeans in financial roles.
But material success has come to be seen as a measure of personal achievement. This line of thinking does indirectly lead people to seek all means, including corrupt wrongdoing, to achieve material wealth. Both the public and private sectors pay senior personnel very high salaries while squeezing lower-level staff who are equally important contributors to societal well-being. We need to put the emphasis back on other values. How the rich and successful people share their wealth to bring about better equality in society will help to reduce social friction in the future. The top earners need to reduce their drive for monetary enrichment. The world’s richest one per cent have too much of the global assets. They need to share more of their wealth with the needy.
If we do not change people’s attitudes and focus on continuous wealth enrichment, it will be difficult to reduce corruption in society. In fact, often it is the senior and more well-off people who resort to corrupt practices to enrich themselves.
AYP Associates Pte Ltd
MANY companies have their own policies in place as a measure to prevent corruption; however, weak internal controls prevent proper execution of these policies. Today’s business environment makes it easier for corruption to occur due to the ease in which fraud and wrongdoing can take place across countries. Thus, an organisation’s board of directors and management have the responsibility to set the correct tone and ensure institutional support for ethical practices and encourage whistle-blowing. Checks and balances can be put in place such as an internal audit review system of price quotations in order to ensure that everything is above board. Staff meetings with heads of departments can be held on a regular basis to emphasise the company’s zero tolerance towards corruption. Lastly, with the increase in the use of technology, data analytics and other technological solutions can be adopted to quickly and accurately identify corruption in the workplace.
Chief Executive Officer
Centre for Executive Education (CEE Global)
CEOs and business leaders today are faced with a complex business environment, further complicated by the possibility of corrupt practices. Corruption impedes the free flow of goods and services across borders, distorts international trade processes and inhibits economic growth, particularly in developing countries. Companies need to establish an anti-corruption policy that applies and documents appropriate management control systems that combat bribery, including maintaining fair and accurate books and records. It should be a requirement for directors, officers, employees and outside parties acting on behalf of your business such as agents and partners, to periodically sign an agreement to comply with this anti-corruption policy.
Finally, there is a need to educate and train employees and outside parties on a regular basis about their responsibilities and appropriate actions to take if they encounter corruption. In essence, CEOs need to put a focus on developing the right organisational culture – when you get this right, you will have guiding principles. People will know your organisation for this.
Employees will live by it. It will help get you through difficult times. You will base hiring and firing decisions on the principles. It will help get all employees working on the same company mission. In some sense, it is the glue that keeps the company together.
Group Executive Chairman and Co-Founder
Htwo Education Holdings Pte Ltd
SINCE independence, the government has been working hard to eradicate corruption, especially in the public service. The Corrupt Practices Iinvestigation Bureau has done well in stamping out corruption. Not only were we successful in the public service, corruption was also abhorred in the private sector. Laws were set in place and continuing public education on the evils of corruption were advocated.
Just like in public service where integrity is a core value, private companies should also have such a policy in order to cultivate a graft-free corporate culture. In Htwo Holdings, all staff are given guidelines on appropriate corporate behaviour in their induction programme, including SOPs and etiquette protocol in business dealings. Every staff member is made to understand what this means, and training in this aspect is included in their orientation and on-the-job training. Current practices are in line with our policy on maintaining fair and honest business transactions with our clients. Any feedback or information which suggest corrupt behaviour is investigated and corrective action will be taken.
The Prime Minister’s announcement on measures to strengthen Singapore’s anti-corruption culture is much welcomed. I feel that our efforts on this should be maintained especially among our young so that the values become well-entrenched in Singaporeans.
Robin C Lee
Bok Seng Group
CORPORATE integrity stems from the top. There is a Chinese saying “If the pillar at the top is not straight, the bottom one will be crooked.” There is plenty of evidence that corruption has been around for the longest time, but only in recent years has this problem received the attention that it deserves. Unfortunately, the increased attention reflects not only greater awareness in this age of Internet and social media but also due to corruption becoming ever more prevalent. The factors that promote corruption can be looked at from a supply and demand perspective: In the business world, we occasionally get exposed to demand in the form of authorisations, certain spending decisions, provision of goods and services at sub-par prices. While these issues might be beyond our control, we as business leaders are definitely able to at the very least manage the supply of corrupt acts by instituting and enforcing robust control and scaled-up audit processes to ensure that any opportunity for corruption act is extinguished immediately. Prevention is always better than the cure.
Regional Director (Singapore & Europe)
QI Group of Companies
THE impending moves to strengthen anti-corruption measures in Singapore are timely and well-conceived. Building and sustaining a graft-free corporate culture is a must, but it is a complex undertaking. CEOs today face anti-corruption legislation – the UK Bribery Act 2010, US Foreign Corrupt Practices Act and in Singapore, the Prevention of Corruption Act. All these impose onerous significant repercussions including extra-territorially for corruption. Understanding the implications lead to applications for sustainability. It means having a top-down approach in educating employees (via in-house seminars, for example); counselling key managers and and C-suite personnel on the perils of graft; strengthening and reviewing all processes; setting up internal audit or compliance teams, creating strong financial oversight and integrity at all levels; and finally, buy-in conceptually. External training by audit and law firms will also be helpful. In law, by reason of “presumptions” of corruption (on gratification given or received for instance), risk mitigation and preparedness are crucial internally especially if (or when) Deferred
Prosecution Agreements come into legislation. Corporate reforms and compliance frameworks to alert or protect graft will be viewed as a key measure for leniency. CEOs have no option but to militate for such overarching aspects (locally and overseas, internal and external) since liability will fall upon the entity itself, as much as its senior management.
Singapore Press Holdings Limited