FCPAméricas Blog

The World Bank Harmonizes Global Anti-Corruption Compliance Standards

Author: Matteson Ellis

Yesterday I attended a roundtable discussion at The World Bank (the Bank) about the Bank’s sanctions and anti-corruption efforts. The discussion included several high-level Bank staff who, together, are developing and implementing policies to prevent, detect, and respond to fraud and corruption in Bank-financed global development projects.

This is important work. In FY 2011 alone, the Bank has committed over $57 billion in credits, loans, grants, and guarantees, and it has a fiduciary responsibility to ensure that these funds are used for their intended purpose.

Though I have spent several years conducting fraud and corruption investigations for the Bank’s integrity unit (the Integrity Vice Presidency), it was not until yesterday that I first learned about the notable advancements the Bank has recently made on the private sector compliance side of the effort.

Pursuant to Section 9.03 of the new sanctions procedures, the Bank has created an integrity compliance officer (ICO) to advise sanctioned companies and parties on the establishment and implementation of compliance programs. Because the Bank’s new “baseline” or default sanction is one of “debarment with conditional release,” the parties can adopt and implement effective programs as a condition for release from debarment.

To advise on compliance and to evaluate and monitor compliance implementation, the ICO has developed Integrity Compliance Guidelines. These guidelines include eleven broad areas: Prohibition of Misconduct; Responsibility; Program Initiation, Risk Assessment and Reviews; Internal Policies; Policies Regarding Business Partners; Internal Controls; Training and Communication; Incentives; Reporting; Remediate Misconduct; and, Collective Action.

Though the names of some of these categories might differ from the names found under other compliance regimes (e.g., “Responsibility” is defined, in part, as “Strong, explicit, visible, and active support and commitment from senior management,” an idea that might be called “tone from the top” in other contexts), their concepts are similar.

The one category that might be less common is that of “Collective Action,” which encourages companies to “endeavor to engage with business organizations, industry groups, professional associations and civil society organizations to encourage and assist other entities to develop programs aimed at preventing Misconduct.”

What is most notable about these guidelines is that they represent the first comprehensive effort I have seen to harmonize the many standards out there. They draw from the U.S. Foreign Corrupt Practices Act (FCPA) enforcement guidance, U.S. Sentencing Guidelines, UK Ministry of Justice’s Guidance on the Bribery Act, the United Nations Convention Against Corruption, the 2010 OECD Good Practice Guidance on Internal Controls, Ethics and Compliance, Transparency International’s Business Principles for Countering Bribery, the ICC Rules of Conduct to Combat Extortion and Bribery, the World Economic Forum’s Partnering against Corruption Initiative’s (WEF-PACI) Principles for Countering Bribery, the  ICC Rules of Conduct and Recommendations, and even the standards that private industry is independently developing to address risk.

The current ICO, Michael Silverman, qualifies the work that has already been done: “Though these many standards have not yet been fully harmonized, we have been able to bring them closely into line with the hope that further harmonization efforts will continue and accelerate.”

This only makes sense. Perhaps complete harmonization is impossible given the fact that different regimes are designed to respond to different risks depending on the legal system, regional area of focus, or industry. But the very act of “bringing them into line” is, in itself, significant. The more uniform the basic compliance expectations across regimes can be, the easier it is for participants in the global market to structure their business operations to adhere to them.

The FCPAméricas blog is not intended to provide legal advice to its readers. The blog entries and posts include only the thoughts, ideas, and impressions of its authors and contributors, and should be considered general information only about the Americas, anti-corruption laws including the U.S. Foreign Corrupt Practices Act, issues related to anti-corruption compliance, and any other matters addressed. Nothing in this publication should be interpreted to constitute legal advice or services of any kind. Furthermore, information found on this blog should not be used as the basis for decisions or actions that may affect your business; instead, companies and businesspeople should seek legal counsel from qualified lawyers regarding anti-corruption laws or any other legal issue. The Editor and the contributors to this blog shall not be responsible for any losses incurred by a reader or a company as a result of information provided in this publication. For more information, please contact Info@MattesonEllisLaw.com.

The author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author.

© 2011 Matteson Ellis Law, PLLC

Matteson Ellis

Post authored by Matteson Ellis, FCPAméricas Founder & Editor

Categories: Anti-Corruption Compliance, FCPA, Transparency International, UNCAC, World Bank

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3 Comments

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3 Responses to “The World Bank Harmonizes Global Anti-Corruption Compliance Standards”

  1. High Tide: From A Shakeup In South Africa To A Convention In Marrakesh : Bay Patrol Says:

    […] Act corruption laws. Mike Volkov is busy blogging again with two new posts. The FCPA Americas blog looks at harmonizing anti-compliance standards by the World […]

  2. Lorenzo Mews Says:

    It’s a peace of mind day to be able to read an article that is so clearly researching and written. I admire very much enjoyed this news content. Your layout is excellent. I will come back again.

  3. World Bank Sanctions: Theories of Liability for Corruption, Fraud, and Collusion LEC - Legal, Ethics and Compliance Says:

    […] to develop such controls? For World Bank matters, a good starting point is the World Bank’s Integrity Compliance Guidelines. The standards in these guidelines now serve as the basis for the Bank’s debarment with […]

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