Transparency International has published a new guide to encourage and help state-owned enterprises to implement best-practice anti-corruption programs based on the highest standards of integrity and transparency.
Compared to other companies, state-owned enterprises (SOEs) pose higher corruption risk because of their close interactions with governments and public officials and the scale of the assets and services they control. In fact, some of the biggest recent corruption scandals have involved SOEs, demonstrating the risks these companies pose.
“The most effective way for SOEs to combat corruption is through transparency; this is at the heart of the SOE principles,” said Transparency International Chair Delia Ferreira Rubio. “Because SOEs are owned by the public, they should be beacons of integrity and transparency. Unfortunately, this does not always seem to be the case.”
The “10 Anti-Corruption Principles for SOEs” provide a code for ethical behaviour and a practical framework to counter corruption risks. In particular, they emphasize the role of corporate governance in providing accountability to stakeholders through transparency and public reporting.
Under these principles, the SOE board and management, supported by all its employees, shall:
Operate to the highest standard of ethics and integrity;
Ensure best practice governance and oversight of the anti-corruption program;
Be accountable to stakeholders through transparency and public reporting;
Ensure human resources policies and procedures support the anti-corruption program;
Design the anti-corruption programme based on thorough risk assessment;
Implement detailed policies and procedures to counter key corruption risks;
Manage relationships with third parties to ensure they perform to an anti-corruption standard equivalent to that of the SOE;
Use communication and training to embed the anti-corruption programme in the SOE;
Provide secure and accessible advice and whistleblowing channels; and
Monitor, assess, and continuously improve implementation of the anti-corruption program.
“These 10 anti-corruption principles aim to help SOEs implement successful anti-corruption programmes and be transparent and accountable to their ultimate owners: citizens,” said Jermyn Brooks, chair of TI’s Business Principles Steering Committee and SOE Working Group.
The SOE principles were developed through a multi-stakeholder process, in which TI sought advice and recommendations from SOEs themselves, its chapters, academics, and governance experts from around the world. They are aligned to the Business Principles for Countering Bribery, which TI launched in 2003 and last updated in 2013. They have contributed significantly to shaping corporate anti-bribery practice.
The SOE principles are also designed to complement the work of the Organisation for Economic Co-operation and Development (OECD) on providing corporate governance and anti-corruption guidance to governments. “We look to all SOEs, from large to small, to adopt and use the guidance set out in the principles and we also call on state owners to require and encourage their use,” Brooks added.