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10.7. Do institutions and procedures ensure transparent, effective and consistent application and enforcement of laws and regulations on anti-corruption, including bribe solicitation and extortion and integrity in the public service? Have standards of conduct by public officials been established and made transparent? What measures are used to assist public officials and to ensure the expected standards are met? Are civil society organisations and the media free to scrutinize the conduct of public officials’ duties? Are “whistle-blower” protections in place?
Rationale for the question
Many public institutions are involved in applying and enforcing laws and regulations on anti-corruption and integrity. Agency specific guidelines and practical measures (e.g. staff rotation, specific training or briefing etc.) may need to be developed to enforce anti-corruption and integrity standards in parts of the public service that are particularly exposed to corruption. Specific risk areas include law enforcement, public procurement, export credit, development assistance as well as customs and tax administration.
Codes of conduct are often developed to provide standards of conduct in a single concise document. These should be made available and adequately communicated to all public officials. Socialisation mechanisms, such as training and counseling, raise employee awareness and help develop their skills for meeting expected integrity standards in daily practice. In addition, human resource management policies should provide suitable conditions and incentives for public officials, such as basing recruitment and promotion on merit, providing an adequate remuneration and taking ethical considerations into account in recruitment and performance appraisal.
Reporting any suspicion of misconduct by public officials can be required by law and facilitated by organisational rules. Whistle blowing, the act of raising concerns about misconduct within an organisation, is a key element of good governance to ensure transparency and accountability. A range of institutions and procedures such as Ombudsman, Inspector General, complaint procedures and help desks or telephone lines could enable public officials and citizens to expose wrongdoing. Their effectiveness also depends on public confidence that people who make bona fide reports about wrongdoing receive proper protection against retaliation.
Related PFI questions:
Question 2.1 on an investment climate strategy
Question 6.1 on a regulatory framework for corporate governance
Policy practices to scrutinise
These questions concern the overall framework for fighting corruption and promoting integrity. The PFI user should consider the overall criminal law system, administrative checks and balances, and the institutional means for law enforcement from an anti-corruption and integrity perspective. The criteria and indicators to examine cover a broad range of institutions and issues.
In reviewing Question 10.7 the PFI user should examine the following criteria and indicators:
The existence of bodies that include within their competence the fight against corruption, including bribe solicitation and extortion. These bodies must have the necessary independence and autonomy to perform their functions, subject to checks and balances to prevent abuse, and sufficient human and financial resources to effectively apply and enforce laws and regulations on anti-corruption. Where more than one body is involved in the fight against corruption, procedures should exist for information sharing and cooperation. Inter-agency communication has proved vital in detecting bribery in public administration, with a number of countries establishing centralised co-ordination agencies to improve information sharing.
The establishment of codes of conduct for public officials and subsequent dissemination and related training. These codes should be clear and transparent and be combined with strict sanctions against public officials involved in corruption. Public sector managers should likewise receive clear guidance and training on the manner in which allegations of corruption should be dealt with, including referral mechanisms to law enforcement authorities, procedures for the protection of informants, and the means for dealing with an official against whom allegations have been made. Codes of conduct might take the form of government-wide documents or involve a series of subject-specific codes. In either case, the content of these codes should take into account areas of public service which are particularly at risk of receiving or soliciting bribes or of resorting to extortion, including law enforcement, public procurement, export credit, development assistance, and customs and tax administration.
The reporting by domestic officials to superiors, prosecutors or other public authorities of instances where they or other domestic officials have been promised, offered or given a bribe by foreign nationals or companies should be facilitated. Officials should know, for example, how to report on such occurrences and how this will be dealt with. Where the bribe involves another official, sufficient safeguards should be put in place (such as whistleblowing and witness protection programmes) to ensure that reporting is not discouraged by the prospect of the reporting person being penalised in some way. Procedures might allow officials and public employees to provide anonymous information to those responsible for investigating corruption and integrity matters. Steps to treat communications as confidential need to take into account the rights of the accused person, and the possibility that disclosure of the information might be necessary to conduct an investigation and/or prosecution. Indicators of the success of these mechanisms and of codes of conduct and public sector training can include instances of such reporting by domestic officials.
Reporting of promises, offers and bribes by competitors, employees or other private individuals, including the media, should also be facilitated. Procedures might include, for example, both formal mechanisms for reporting and anonymous hot lines. Procedures should guard against malicious false reporting by competitors such as by obtaining independent verification of allegations before taking further action.
The existence of adequate accounting requirements, independent auditing, and internal company controls are also essential for detecting and preventing corrupt practices. By way of example, companies should be prohibited from making off-the-books transactions or keeping off-the-books accounts, and they should be required to maintain adequate records of the sums and the means by which money is received and spent. Likewise, auditors who discover indications of a possible illegal act of bribery should be required to report this to management and, as appropriate, to corporate monitoring bodies. Consideration should also be given to imposing a duty to report to law-enforcement authorities.
Sharing information received from public officials, companies or individuals with other concerned countries contributes to the international framework of combating corruption. In complex or large-scale corruption cases, information sharing can be essential and hence should be facilitated either by direct mechanisms or by allowing sufficient flexibility within the existing system. This matter is considered further under Question 10.9.
Effective public awareness and assistance programmes are essential to the successful detection and reporting of corruption and practices lacking integrity. These include activities (e.g. public campaigns) and information (e.g. easily accessible websites). Private sector awareness of laws and regulations on anti-corruption is essential and it may be desirable to establish, or assist professional bodies in carrying out, training programmes for lawyers, accountants, auditors and others. Awareness of both prohibited conduct and mechanisms for detecting, reporting and investigating corrupt and dishonest conduct should be enhanced. Whistleblower and witness protection programmes should be publicised through public awareness campaigns, online information and public and private sector training. Although indicators of public awareness may be difficult to ascertain, a complete lack of referrals of suspicious conduct may be indicative of a corresponding lack of awareness or understanding, rather than an absence of corrupt practices.
As part of private sector awareness, individuals and companies might be permitted to submit a request for an opinion (based on the facts of a prospective transaction) as to whether the transaction would constitute an offence of bribing a public official. Such assistance should not create undue exceptions to corruption offences or otherwise undermine anti-corruption and integrity laws and regulations. Private initiatives to develop corporate codes of conduct or compliance schemes to enhance internal company controls and militate against companies or their employees engaging in corrupt practices might also receive assistance. The OECD Guidelines for Multinational Enterprises and the OECD Principles on Corporate Governance, as they relate to issues of bribery, can provide useful guidance in this regard.
Reference can be made to the institutional structure of individual countries, such as that in the United States for example (see the reportOrganizations, Transparency, and the Fight against Corruption: Institutions of Integrity in the United States). Consideration of such issues within a number of OECD Anti-Bribery Convention States parties is made part B(2) of the OECD Working Group on Bribery Mid-Term Study of Phase 2 report.
The Revised Recommendation of the OECD Council, adopted on 23 May 1997, sets out recommendations (Recommendation V) on Accounting Requirements, External Audit and Internal Company Controls.
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