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Category: Risk assessment

Preventing Corruption Decoded for Leaders and Beginners

Steve Tosh At no time has education been more important to organisation development and ability to identify and prevent corruption. One thing that recent global…

Stephen July 12, 2021

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The Insider Threat: Influence, manipulation and reward

Share on facebook Facebook Share on twitter Twitter Share on linkedin LinkedIn Share on email Email The fraud and corruption case and the insider threat…

Stephen March 4, 2021

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Anti-Corruption Assessment During Vendor Registration: The Key to Protecting Revenues

Anti-Corruption assessment during vendor registration: The key to protecting revenues When we consider a new way of thinking for Government and private sector procurement where…

Stephen January 7, 2021

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Forum Description

Anti-Corruption assessment during vendor registration: The key to protecting revenues

When we consider a new way of thinking for Government and private sector procurement where there are significant concerns surrounding procurement fraud and corruption, how do we protect national and organisation revenues and how do we send a message that we have a new stance in dealing with this problem.

By Steve Tosh

To improve is to change; to be perfect is to change often

In 2012 and again in 2015, Transparency International UK Defence and Security Programme (TI) led by Mark Pyman assessed the ethics and anti-corruption programmes of 163 Defence companies from 47 countries using publicly available information. Based on the extent of public evidence on their ethics and anti-corruption programmes, companies were placed in one of six bands A to F from extensive evidence through to almost no evidence. All companies in the index were sent a draft assessment for comment and review.TI also reviewed information that is internal or confidential to companies. Sixty-three companies provided detailed internal information in 2015, almost double the number that did so in 2012.KEY FINDINGSTwo-thirds (107 companies) performed in the bottom half of the index (bands D to F), with limited to no evidence of such programmes

23% (37 companies) provide no evidence at all
42 companies out of 127 (33%) improved significantly since 2012, by one or more bands. In total, 76 companies (60%) have improved compared with 2012.

In assessing the level of risk the anti-corruption analysis was banded into six categories, specifically:

Leadership, governance and organisation
Risk management
Company policies and codes
Training
Personnel and helplines
Offsets

COMPANY ACTIONThis significant piece of analysis and subsequent publication on which companies have been proactive in developing and improving their anti-corruption initiatives highlight a major point. A significant number of companies recognise the importance of anti-corruption to their reputation and business bottom line. Although a significant piece of work by all, the findings are clear and now a simple method of assessing assessing the defence sector for business bribery risk and should be a message to all sectors of how they should look at risk mitigation. A NEW VENDOR ANTI-FRAUD APPROACHWhen we appraise this simple method of assessing corruption risk, both public sector and private sector need to assess its implementation as part of a supplier on boarding process. If we are taking steps to check for conflicts of interest, a vendor’s ability to adequately complete the contract including verifying previous performance, that they are a low financial risk, that they are compliant with organisation policies such as health and safety or action towards the sustainable development goals including modern day slavery and child labour, why wouldn’t we make the same assessment for their proactive stance on anti-fraud and anti-corruption. If a vendor can’t adequately evidence that they can protect public or private sector revenues particularly in high value projects, why would we wish to approve them as a supplier. It shouldn't just be the responsibility of the relevant public or private sector organisation to mitigate fraud and corruption risk. Should a vendor be able to:

demonstrate action by their leadership in setting and leading anti-corruption and governance activities
evidence their risk management approach to their supplies and supply chain including risks from counterfeit products and bribery
provide company's procurement and anti-fraud and corruption policies including codes of conduct
clearly outline what anti-fraud and corruption training is provided to their staff
provide information on staff engagement and helplines and hotlines to receive guidance and report fraud and corruption suspicions

THE KEYS TO THE FRONT DOORSupplier registration is the key point and may be the only opportunity that we assess a vendor for risk and yet in the majority of cases we don’t assess their anti-corruption or anti-fraud stance. Having a policy isn’t enough, it’s not just about communication by the vendor that they have a policy it’s also about proactive action. How do companies evidence that they can protect their supply chain from product substitution. Do they understand the key procurement fraud methodologies and how to mitigate the risk particularly within high value projects? The Transparency International report highlights the key areas where a vendor should be assessed. Where we signpost our stance on anti-fraud and anti-corruption and spend more time and resource at the point of supplier registration, I believe will more effectively reduce incidents and opportunity for corruption and also create a more effective procurement process and reduce the instances of failing projects. Since the TI publication in 2012 and again in 2015 some companies have taken significant steps in anti-corruption and yet I feel with more and more press coverage on global corruption investigations and prosecutions, are companies taking this significant guidance seriously? Facebook-f Twitter Linkedin-in

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Category: Risk assessment

Preventing Corruption Decoded for Leaders and Beginners

Top 10 Questions to Reduce the Likelihood of Importing Vendor Risk

The Insider Threat: Influence, manipulation and reward

Anti-Corruption Assessment During Vendor Registration: The Key to Protecting Revenues

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