SEDEX SUPPLIER WORKBOOK

PART 4:
BUSINESS ETHICS
 SEDEX BACKGROUND VERITÉ BACKGROUND
Sedex Information Exchange is a unique and Verité is an international not-for-profit consulting,
innovative platform, helping companies to training, and research organisation that has been
manage ethical supply chain risk and streamline a leader in supply chain social responsibility and
the challenging process of engaging with multi- sustainability since 1995. Verité’s holistic
tier supply chains. approach is based on an extensive, applied
understanding of common obstacles and effective
As the largest collaborative platform for managing strategies for managing supply chain
ethical supply chain data, Sedex engages with all risks. Verité’s programs help companies and
tiers of the supply chain with the aim of driving other stakeholders fully understand social
improvements and convergence in responsible responsibility issues, overcome the root cause of
business practices. unsafe, unfair or illegal conditions for workers,
and build sustainable solutions into business
Through a secure online platform, Sedex practices, benefiting companies and workers
members can share and manage information alike. For more information, please visit
related to Labour Standards, Health & Safety, www.verite.org.
The Environment and Business Ethics. Members
also have access to a range of resources and
reports, including industry specific questionnaires
and market leading risk analysis tools, developed
with global risk experts Maplecroft. Additional
support services such as supplier engagement,
audit management and risk screening are also
available through Sedex Information Exchanges’
sister company, Sedex Solutions. For more
information, please visit www.sedexglobal.com.

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS ii

FOREWORD

Letter from the General Manager of Sedex

I am very pleased to introduce the Sedex Supplier

Workbook. This workbook has been co-developed with
Verité and is an excellent resource that provides Sedex
members and suppliers around the world with useful
guidance to help improve labour standards, reduce
negative environmental impacts and ensure their
businesses operate in an ethical manner—all of which I
believe will make our members’ companies more
successful, and therefore sustainable, long into the
future.

Businesses around the world have a responsibility to

Core to our mission is reducing duplication by enabling
protect the rights of their workers and to minimise their
members to share data and use common approaches
impacts on the environment. Today, every business that
for collecting information. We are also committed to
sells products into the global supply chain—large or
helping businesses around the world develop and
small—has to think about how they can meet their
become even more successful businesses by providing
responsibilities. Customers who purchase products want
information, training and advice. The Sedex Supplier
to know the product they are buying has been produced
Workbook is a free resource, providing information and
in a responsible and ethical way. They trust businesses
support on key issues and challenges often experienced
to do the right thing, and businesses who do not meet
by our members. It also demonstrates the business
their customers’ expectations risk losing their trust,
benefits that can be gained by successfully addressing
which inevitably impacts the financial performance of the
such issues.
company. Trust once lost is hard to rebuild. We know
from many years of experience that the most cost-
I trust you will find this resource useful. As always, I
effective and long-lasting way for suppliers to meet
would welcome any feedback or comments you have on
these expectations is to make them an everyday part of
the workbook, as well as suggestions on other ways
their daily operations.
Sedex could support you in the future, so please email
me at carmel.giblin@sedexglobal.com.
Sedex was launched in 2004 to ease the burden on
suppliers facing multiple audits and questionnaires, and
Best regards,
to drive a collaborative approach amongst brands and
retailers. Since our beginning, Sedex has grown and is
now the largest collaborative platform in the world for
managing ethical supply chain data. We have more than
28,000 Supplier members and over 500 Retailers and
Brands.

Carmel Giblin
General Manager

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS iii

Letter from the CEO of Verité

Achieving ethical sourcing requires that knowledge

and skills are broadly shared and easily accessible.
The wide adoption of this Workbook means that
businesses and workers will share in the benefits of
sustainable practices at a much greater scale.

It is no longer enough that businesses and their

suppliers understand what risks they face. It is
essential that we achieve positive and measurable
change.

Such change not only benefits workers by providing

fair and predictable wages, safe working conditions,
and the opportunity to raise concerns with employers;
it results in more effective businesses as well—
Entrepreneur of the Year Award, and the 2010 Clinton
businesses that can count on stable workforces, find
Global Initiative. We’ve been grateful to be able to
efficiencies and build positive profiles for their clients.
offer this expertise as a member of the Alliance to End
Through our extensive involvement with leadership- Slavery and Trafficking, and as a Founding Circle
level social responsibility programming, we have both member of the Sustainable Apparel Coalition.
benchmarked and helped develop best practices in
We are similarly pleased for the opportunity to
ethical sourcing, program analysis, risk management
collaborate with Sedex, and to share our experience
and supplier engagement. For those efforts and for
about what businesses can achieve and how they can
this Workbook, Verité draws from the expertise and
achieve it.
deep experience of our regional teams and network of
partners in China, Southeast Asia, India, and
Bangladesh, Europe and Latin America. Our programs
range from short-term solutions for urgent conflicts at With all good wishes,
factories and farms, to multi-year, industry-wide
partnerships. An underpinning of this work has been
our landmark studies on such issues as trafficking and
forced labour, excessive overtime, labour conditions in
commodity supply chains, and gender equity. Our
contributions to a nuanced understanding of the nature
and systemic solutions to these issues have been
recognised by the 2007 Skoll Award for Social Daniel A. Viederman
Entrepreneurship, the 2011 Schwab US Social CEO

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS iv

CONTENTS

Introduction
What is this workbook for? vi
Who is it for? vi
Why is it important? vi
How was this workbook developed? vi

How to Use the Workbook

Scope of issues vii
Questions, comments, feedback x

Part 4: Business Ethics

4.1 Business Ethics Management
System
Definition 2
Benefits 2
Requirements 3
Achieving and Maintaining Standards 4
Common Audit Non-compliances 9
Case Study 11
Resources and Guidance 12

4.2 Anti-Corruption
Definition 16
Benefits 16
Requirements 17
Achieving and Maintaining Standards 18
Common Audit Non-compliances 24
Case Study 25
Resources and Guidance 26

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS v

INTRODUCTION

What is this workbook for? Why is it important?

This workbook is a guide to help suppliers understand Managing the risk of harm or unfair treatment to your
what ‘good practice’ looks like when thinking about employees or damage to the environment is good
meeting ETI and other Code requirements, and how business practice. In a world where companies are
you can get there. The following chapters will help you expected to demonstrate corporate social
take a systems approach to find and fix the gaps that responsibility (CSR), you are also protecting your
can lead to social and environmental non- company’s reputation. And because your customers
compliances. What this workbook is not is a standard must protect their own reputation for ensuring the legal
for you to adhere to, or another management system. and humane treatment of workers in their supply
If you are operating a factory or a farm, you already chains and the minimising of environment impact, you
have a management system, even if it is an informal are protecting your business relationship with these
one. customers as well.

What we are offering is a practical risk-management Research has shown a direct link for many companies
tool for building controls into the business processes— between CSR and other business benefits, such as
for example, hiring and paying your employees—that savings from worker retention and improved
you are already using. These controls will help you productivity from stronger worker-management
meet your customers’ and your own business, social communication and engagement processes. Our
and environmental responsibility objectives. approach recognises this link between the bottom line
and a safe and fair workplace.

Who is it for?
How was this workbook developed?
This workbook is written for the people in factories and
farms who make decisions that have an effect on the Verité has developed this workbook in partnership with
working conditions of their employees or the Sedex based on over 15 years of experience
surrounding environment. You may be the owner of a researching and helping to address the challenges of
smallholder farm, the human resources director of a balancing CSR and business imperatives in global
large corporation, or the compliance officer of a mid- supply chains. We are grateful to the Sedex members
size factory in charge of making sure your company who have contributed case studies, feedback and
passes your customers’ social audits. The basic risk- resource documents that are the product of their many
management approach we have described in these years of work on these issues. A number of NGOs
chapters applies to businesses of all sizes in all served as valuable reviewers and advisors as well.
industries. We will list all contributors as soon as the workbook is
complete. Even then, this collaboration will continue.
We intend this workbook to be a ‘living’ document that
will be continuously improved with the learning and
feedback of members and other stakeholders over
time.

The workbook is available in PDF form on the Sedex website either in sections or individual chapters.

Access and download the full Sedex Supplier Workbook

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS vi

HOW TO USE THE WORKBOOK
Scope of issues
Each chapter is devoted to a Sedex issue area covered by the Sedex SAQ. As shown by the
sample sections below, the chapter defines the issue, lists key standards, and describes an
approach to reaching the standards. Common audit findings, best practice suggestions, case
studies and resources are offered as well.

Definition of the issue

The definition comes directly from ILO

conventions or, in the absence of an ILO
definition, is drawn from the broadly
accepted understanding of the issue.

Benefits

The workbook lists the possible

business benefits of compliance with
the Code and international standards
relating to the issue.

Requirements

The ETI Base Code provisions as well

as other international conventions and
standards are listed in this section,
with links to more detail.

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS vii

 Achieving and Maintaining Standards

This section outlines the systems approach to

reaching and sustaining compliance in each
issue area.

Combined with a strong management system

(described in detail in the Management Systems
chapters), this section gives step-by-step
guidelines to help you successfully achieve the
standard in:

 Policy
 Procedures
 Documentation
 Monitoring
 Communication and Training

Please note that this list is only a suggested course of action, and is not an exhaustive list.

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS viii

 Other Features

Each chapter includes a sample of audit non-compliances from the Sedex database and a case study
provided by Sedex members. The chapters also offer answers to common questions, best practices,
resources and guidance, signposts to training, and a glossary of key terms.

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS ix

Questions, comments, feedback

If you have any questions or comments, please contact content@sedexglobal.com.

SEDEX SUPPLIER W ORKBOOK · PART 4: BUSINESS ETHICS x

SEDEX SUPPLIER WORKBOOK

Chapter 4.1

BUSINESS ETHICS
MANAGEMENT
SYSTEMS
Business Ethics Management Benefits
Systems Why should you do it?

What does it mean?

Building responsibility for business ethics into your
business management system will help you stay
within the law, avoid penalties and meet your
customers’ requirements.
A Business Ethics Management System is the set
of interdependent policies, processes, and There can also be business benefits, such as:
procedures that a company uses to conduct its
a) Improving your company’s image and
operations legally, ethically and consistent with its
values. reputation.
b) Achieving both your business and social
A management system also serves to continuously responsibility objectives.
improve key business processes and outcomes to
c) Building and maintaining customer trust.
meet core strategic goals. A Business Ethics
Management System is how a company effectively d) Avoiding ethical dilemmas.
controls risks of bribery, corruption, collusion and
e) Cost savings through improvements in system
other business conduct issues.
efficiency.
Conducting your business in an ethical manner is
an important social responsibility objective and a
regulatory requirement. An effective Business
Ethics Management System balances these Advantages of a Management System
requirements with running a successful business. approach to Business Ethics

To be successful in this approach, we: Effective management systems strengthen

your company’s ability to:
 Describe the possible unintended ‘business
 Develop suitable policies, plans and
ethics’ outcomes of policies and procedures
objectives.
that are meant to achieve business
objectives.  Implement the appropriate business
process controls.
 Identify operational controls to manage or
 Identify the necessary human and
avoid these unwanted outcomes.
financial resources.
 Show how to monitor and measure the  Measure and continually improve
effectiveness of your controls to ensure you performance.
meet standards.

This section will help you check whether there is a

risk of not maintaining essential management
system elements in your current business
operations, and if so, how to put controls in place
to make sure you meet standards.

Note: The approach described in this chapter is similar to

those described in Labour Management Systems,
Environmental Management Systems, and Health & Safety
Management Systems.

2
 Other International Standards and Guidelines:
Requirements
What do you need to do?  ISO 26000 (2010), Section 6.6, Fair Operating
Practices, contains specific guidance on how
companies can manage business practices
risks:
There are no ETI Base Code
Clauses that address business Fair operating practices concern ethical
ethics. However, business ethics conduct in an organisation's dealings with
is an essential component of other organisations. These include
corporate responsibility and social relationships between organisations and
compliance. As such, Sedex government agencies, as well as between
recommends member companies organisations and their partners, suppliers,
to use a management systems contractors, customers, competitors, and the
approach to control business associations of which they are members.
ethics risks like bribery, corruption, legal compliance,
Fair operating practice issues arise in the
protecting sensitive information and whistleblower
areas of anti-corruption, responsible
protection.
involvement with public officials, fair
ETI Principles of Implementation competition, socially responsible behaviour,
relations with other organisations and respect
Although developed primarily to improve conditions for for property rights.
workers, the ETI Principles of Implementation provide
useful guidance for suppliers who would like to
integrate ethical business practices into their business
management system.

1. Commitment (policy, communication,

resources, strategy).

2. Integration with core business practices

(supplier selection, terms of agreements,
internal buy-in).

3. Capacity Building (worker awareness, effective

industrial relations).

4. Identifying problems in the supply chain (risk

assessing and sharing, monitoring and
evaluation, worker complaint mechanisms).

5. Improvement actions (enabling remediation,

time-bound remediation, tackling root causes).

6. Transparency (fair and accurate reporting,  FCPA – Foreign Corrupt Practices Act
response to violations). (1998) requires:

Relevant ILO Conventions — Due diligence on customers, the nature

of their business and the types of
All of the ILO core conventions are essential for financial transactions they undertake.
compliance to good business ethics, as well as
— Conducting senior management
important considerations in supply chain
meetings where the risks of bribery and
management.

3
 corruption are reviewed, discussed and  There is no damage to company reputation as
recorded. a result of fraudulent or unfair business
— Staff training. practice.

— Independent monitoring.  The same business ethics issues do not occur

repeatedly.
 Sarbanes-Oxley Act (2002) requires
companies ‘to protect investors by improving
 Workers, supervisors and managers are
the accuracy and reliability of corporate
properly trained on ethical business practices
disclosures made pursuant to the securities
and responsibilities.
laws.’

 UK Bribery Act (2010) creates the following  There is a process to protect the confidentiality
of supplier and employee whistleblowers.
offences:
It is important that you also regularly monitor your
— Active bribery: promising or giving a
processes and controls to make sure they are
financial or other advantage.
working.
— Passive bribery: agreeing to receive
or accepting a financial or other
advantage. A systems approach is ‘self-
correcting.’ It will enable to you
— Bribery of foreign public officials.
make sure that all requirements
— The failure of commercial are being consistently met.
organisations to prevent bribery by
an associated person (corporate
offence).

Policies
Achieving and Maintaining (rules)
Standards
How do you do it?
Your company should have a business ethics policy or
code that includes the following:
You can best meet standards by using a systems
approach. In other words, you add controls to the  A written statement that clearly defines your
processes you already use to run your business. And company’s approach to conducting business in a
you make sure your policies and procedures are fair and ethical manner. This should include
designed to ensure that: commitments to:

 You are aware of legal and customer  Compliance with applicable local and
requirements. international laws and regulations.

 Adhering to all customer requirements,

 There is a company or facility policy on
including customer-specific codes of
business ethics.
conduct.
 You know the risks in current business ethics  Continual improvement in ethical business
that could lead to compliance issues. performance.

 There is a process in place to verify that  The scope of the policy should include, at a
workers and management are working minimum, all of the following business ethics
according to legal and customer requirements. topics:

4
  Prohibiting bribery, corruption and allegation reporting process to make sure that
extortion. alleged business conduct issues are addressed.

 Giving and receiving gifts.  Monitoring and following up on all concerns and
issues related to the implementation of business
 Protection of company and customer
conduct policies and procedures.
intellectual property and information.

 Fair business practices (anti-collusion,  Performing an annual review of your

advertising). management system to make sure it is effective
and achieving your objectives, and to make any
 Protection of identity (whistleblower required adjustments.
protection).
 A formal process for workers, managers,
 Protecting privacy of personal supervisors, suppliers, and customers to
information. anonymously report any concerns regarding the
 Accuracy of financial records and implementation of business ethics policies.
reports.
Please refer to the Anti-Corruption chapter that Your business ethics and other business function
provides more details on these topics. procedures should include:

 The policy should be signed by the most senior  Ways to track and understand business ethics
manager of the company. laws, regulations, and customer requirements.

 A process to identify the risks in the way you

conduct business that could lead to violations of
business ethics standards.
Procedures
(practices)  A procedure that limits the amount and frequency
of business gifts that employees can give or
Management should assign a responsible person receive from suppliers and customers.
(or department) with documented roles,
 A formal process to screen and select your
responsibilities and authority to make sure your
suppliers based on their ability to meet your
policy commitments are achieved, that regulatory
policies and business ethics laws and regulations.
compliance is maintained and that business ethics
standards are met. This includes:  A process describing how the company records,
discloses and reports its business activities and
 Communicating your policies to all managers, financial performance.
supervisors, and workers.
 A procedure that describes how the company
 Making sure that all managers and employees of protects its own intellectual property and that of
the company have clearly defined roles and its suppliers and customers.
responsibilities for carrying out your business
ethics policies.

 Meeting regularly with managers and supervisors

responsible for sales, supplier and vendor
management, advertising, finance, and other
functions, to oversee the implementation of your
business ethics programmes and procedures.

 Working with the individual or department

responsible for the company’s business ethics

5
  The ways in which the company protects the
privacy of personal information of every person Communication and Training
you do business with.
You should use the following methods to make sure
 A formal process for workers, managers, your employees are aware of your business ethics
suppliers and customers to anonymously report policies and procedures:
any concerns about the implementation of your
company’s policies. The process should detail the  Provide training programmes for new managers,
way your company investigates and resolves supervisors, and newly hired workers on your
reported allegations. company’s business ethics policies and
procedures.
 A disciplinary procedure for company employees
and managers who are found to have violated  All employees must be provided with on-going
company business conduct policies and training and information on the business ethics
standards. issues associated with their jobs using classroom
training, team and department meetings, written
The Anti-Corruption chapter in this workbook describes materials, and work area postings.
in more detail the procedures needed for specific
business ethics issue areas.  Make sure the training covers all applicable
business ethics laws and regulations.

The Headline Test  Use scenarios in the training that are tailored to
local issues and culture.
Before making a business
decision, consider how it would  Display business ethics policies and local legal
look on the front page of the requirements in areas where all employees will
newspaper or as the lead story on see them and in a language they understand.
the evening news.  Communicate the company’s business ethics
requirements, as well as the laws and standards,
to the company’s suppliers using your website, in
contract terms and conditions, and during periodic
meetings.

 Communicate the company’s allegation reporting

procedures and explain how to report concerns
related to how the company conducts its
business.

6
  The topic-specific documents listed in the Anti-
Living Up to Your Company’s Corruption chapter of this workbook.
Values
 Always do the right thing in business
dealings with customers, suppliers
Monitoring
or governments, even with pressure
or incentive to do otherwise.
You will need to check if your business ethics policies
 However, do not put yourself in are being followed and that the controls to make sure
danger. Report any incidents of your company is meeting code and legal requirements
threats or pressure to violate are effective. The following steps can be used to
business ethics policies to your evaluate and improve the effectiveness of your
company’s responsible manager. programs:

 Remember that your company’s 1. Audit your system to identify actual and potential
reputation is your most valuable problems meeting laws and standards. Audits can
asset but can be easily lost. be performed by trained and qualified internal staff
or by external auditors—including from your own
customers.

 Self-audits, including ‘spot’ audits, should be

performed regularly to determine if you are
meeting internal standards and both legal and
Documentation and Records customer requirements.

 Any audit issues should be evaluated to

determine their underlying cause(s) and
Meeting standards requires proper documentation.
action plans established to put in place
You will need to keep the following on file on your
corrective and preventive actions.
company premises:
 The person or department that oversees
 Copies of your business ethics policy signed by
matters related to ethical business practices
senior management.
should also be assigned to monitor issue
 Copies of all applicable laws and the facility’s trends. This person can then identify and/or
legal responsibilities for business ethics. anticipate problems and coordinate with other
managers or departments to develop
 Copies of key business conduct procedures, such solutions that address concerns and prevent
as anti-bribery, fair advertising, gifts, reporting them from recurring.
allegations of misconduct, and others as
described in the chapter that follows.
What Are Examples of Conflicts of
 Management and Board of Directors meeting Interest?
minutes, action items, and attendance records.
 Company employee has outside
 Copies of internal and third party business and employment or receives compensation
financial audit reports, and inspection reports by from a supplier, customer or competitor.
regulatory agencies.
 Officer or owner of the company has a
 Records of allegations of business misconduct. major financial interest in a supplier,
customer or competitor.
 Business ethics corrective action plans and
reports, including documented evidence of  Conducting business with a company
improvements made. when someone in your family has a
major role in that company.

7
  More than one functional department is often
responsible for business conduct issues.
2. Establish and track key performance indicators Solutions to problems may involve, for
(KPIs) to measure how well your business example:
management processes and procedures are
working on an on-going basis.  Procurement staff who manage
contracts with sub-contractors, on-site
 Regularly survey workers to measure their contractors and other suppliers.
satisfaction with the implementation of your
business conduct policies and practices.  Finance staff for the practices of
reporting business and financial
 Track the number and type of reported performance.
allegations of business misconduct. Establish
 Internal auditors who monitor problems.
goals and metrics for issue areas that may be
in need of improvement.  Supervisors to monitor the
implementation of policies every day.
 Measure training effectiveness and learning
retention by testing employees immediately When identifying a solution to a business
after training, and using follow-up ethics problem, work with all departments and
questionnaires three to six months after personnel involved.
training.

3. Investigate problems and analyse why they Best Practice

occurred. When a situation arises that indicates
the existence of non-conformance with company Cooperate with Internal Investigations
business ethics policies and customer code(s) of
conduct, the company should investigate the  Make sure that everyone in your company
causes, not just the condition, and what can be cooperates with investigations of alleged
done to address them. misconduct.

 Be sure to answer any questions from

 Every allegation and incident is an
investigators or regulators openly and
opportunity to improve your procedures and
honestly.
other controls. Every reported issue should
be investigated to find the underlying causes  Preserve all documents and records that may
and develop action plans to make be requested as part of an investigation or
improvements that will prevent a recurrence. audit.
Actions should also aim to prevent similar
incidents throughout the business.

 If your internal audit finds the same or similar

business ethics issues repeatedly, it could
mean that your process to identify and assign
responsibility for putting in place corrective
and preventive actions is not working.

 Similarly, if you have taken action but are still

not meeting standards, it could mean that the
corrective actions (controls) themselves are
not effective and need to be improved.

4. Work with other departments to identify

reasonable solutions. Take care to develop
solutions so that the problem does not recur and
the solution itself does not create other problems.

8
 must be at least detailed enough to meet those
requirements.
Common Audit Non-compliances from
the Sedex Database As for records, you only need to maintain items that
are needed to verify that you are meeting standards,
The following are the most common non- such as financial records, copies of non-disclosure
compliances against this issue. If properly agreements, and records of allegations of misconduct
implemented, the guidance in this chapter can and how they were investigated and resolved.
help reduce the incidence of these problems:
My company has a certified Quality Management
 Inadequate code and system System. Can we use this system for business
implementation.
ethics?
 Inconsistent recordkeeping.
Yes. In fact, any company that has a formal
 No general management systems in place. management system, like ISO 9000 or ISO 14001, can
also use it to manage compliance to business ethics
 Lack of employee awareness of the social
standards rather than creating a separate business
and ethical standards the company
ethics management system. The risk assessment,
upholds.
regulatory tracking, training, communication, grievance
Sedex provides a document with suggested possible process, auditing, corrective action, and other
corrective actions following a SMETA audit. This is
elements of these systems can very easily be adapted
available to Sedex members only in the Sedex Members
Resources section: for business ethics management.
Sedex Corrective Action Guidance
What is Plan-Do-Check-Act?

Plan-Do-Check-Act is a way of describing a

management system to show how risks are controlled
Common Questions and how processes and performance are continually
What resources should I make available to improved.
employees who need help thinking through an
Plan means to identify requirements (laws and
ethical dilemma?
standards), evaluating risks that may prevent you
The best thing you can provide your employees is a from meeting those standards, and establishing
business ethics policy and accompanying procedures policies, objectives, and processes needed to
that describe the types of issues that may be meet standards and achieve objectives.
encountered, the company’s position on them, and
Do means assigning responsibilities, implementing
how to address them. With that, you need to make
your policies and procedures, training, and
available a confidential way for employees to report
communicating.
allegations of misconduct that guarantee there will be
no reprisal against the person making the report. Check is making sure that you are achieving your
Will a management system require a lot of objectives and meeting standards. This involves
documentation and other complexity? measuring performance using KPIs, performing
audits and investigation, surveying workers, and
This is a very common concern, but a business ethics other ways to evaluate how you are doing.
management system does not need to be any more
Act is taking corrective and preventive actions
formal or complex than the system you use to manage
when actual practices differ from your business
your business. For example, a procedure can be as
ethics policy, such as when audits and allegation
simple as a short list of what is to be done, by whom,
investigations find non-compliances. This step also
and how often. Business and financial regulations
includes a regular review by senior management
themselves can get quite complicated, so your system
of your overall system.

9
The government is investigating a company in the
area that my company does business with. The Why do management systems fail?
investigation is looking closely at all documents,
including email. What should I advise my  Lack of senior management sponsorship and
employees to do? commitment.

Your employees need to understand that whenever  Failure to assign a senior manager with
they create documents and records, including emails, responsibility and accountability for implementing
it is important to always assume that they may be the system.
made public. Your training should instruct them that
 Companies try to create a system that is more
they need to cooperate fully with any investigation and
complicated than their current business
that once written, emails and other documents are
management system.
company business records. Their original form should
not be altered.  Management believes that the business ethics
compliance objectives of the system will conflict
with business objectives.

 The system creates extra or duplicate work that the

company believes does not add any value.

 Senior management fails to regularly measure and

review the effectiveness of the system and make
necessary improvements.

10
 Case Study

Business Ethics Management Systems:

Collaborative responsibility Breaches of conduct are reported through official
processes to the global Compliance & Ethics
Corruption presents significant risks to team, who monitor and work to resolve issues on
businesses, including poor use of management the ground. The Diageo Audit and Risk
time and resources, legal liability and damage to a Committee will also receive regular reports on
company’s reputation. By engaging with their compliance to this policy. Any employee can raise
supply chain through meaningful anti-corruption a concern or report breaches to SpeakUp, a
programmes, firms can reduce fraud and related whistleblowing hotline managed by a company
costs, enhance their reputation and create a more independent from Diageo. All contact is
sustainable growth platform. confidentially reported to Diageo, who thoroughly
investigates and follows up any issues.
As a global business, Diageo has a large
responsibility to manage standards in their supply For Diageo, progress has been made by working
chain. David Lawrence, Diageo’s Compliance & collaboratively with their peers. This has been via
Ethics Programme Director, says, “Corruption is industry groups such as AIM-PROGRESS, a
an inhibitor to our business, meaning we have to forum of consumer goods manufacturers and
pay more and it takes us longer to do business, suppliers assembled to enable and promote
especially across country boundaries.” responsible sourcing practices and sustainable
production systems, and business integrity
To prevent corruption it’s vital to have strong, coalitions in Nigeria and Cameroon. Through
coherent communication from the top of your collaboration, they have formed more influential
company of your policy, and to implement movements and raised awareness, often
systems to support your employees to resist escalating the issue up to governments in order to
corruption. build more robust legal frameworks.
Diageo has a comprehensive human rights policy “There’s nothing so powerful as acting
that applies to all company, subsidiary and joint- collaboratively.”
venture employees, and to their upstream and
downstream supply chain as far as is reasonably Diageo is a global alcoholic beverages company
achievable. Diageo’s policy is fully endorsed trading in approximately 180 markets with
manufacturing facilities across the globe. To find out
internally and is sponsored by the Group HR more about Diageo, visit http://www.diageo.com.
Director. Each Diageo employee is responsible for
compliance with the Code of Business Conduct
and Diageo policies in addition to all laws,
regulations and industry standards.
Sedex is always looking for new
case studies. If you have a best
practice example case study that
you would like to be featured,
please send it to
content@sedexglobal.com

11
Resources and Guidance

The following organisations, websites, and documents provide additional information on Business
Ethics Management systems:

 Sedex Members Ethical Trade Audit (SMETA) Best Practice Guidance:

http://www.sedexglobal.com/wp-content/uploads/2012/07/SMETA-Best-Practice-Guidance-4-
Pillar-4_0-L.pdf

 SMETA Corrective Action Guidance (behind member log in):

https://www.sedex.org.uk/sedex/go.asp?wsfedsession=0

 SMETA Draft Supplement for Environment and Business Practices Process (2010) (behind
member log in): https://www.sedex.org.uk/sedex/go.asp?wsfedsession=0

 Ethical Trading Initiative (ETI):

 Principles of Implementation: http://www.ethicaltrade.org/resources/key-eti-
resources/principles-implementation

 International Organisation for Standardisation (ISO): ISO 26000 – Social Responsibility:

http://www.iso.org/iso/home/standards/iso26000.htm

 UK Bribery Act: http://www.fco.gov.uk/en/global-issues/conflict-minerals/legally-binding-

process/uk-bribery-act

 US Foreign Corrupt Practices Act: http://www.justice.gov/criminal/fraud/fcpa/

 Sarbanes-Oxley Act: : http://www.soxlaw.com/

 Transparency International Business Principles for Countering Bribery:

http://www.transparency.org/whatwedo/tools/business_principles_for_countering_bribery/1/

Signposts to Training

 ISO 26000: http://www.ethicalperformance.com/training/course/40

 Transparency International: http://www.transparency.org.uk/ti-uk-programmes/training

 DuPont Sustainable Solutions – Ethics and Compliance Training:

http://www.training.dupont.com/human-resources-training

 Global Compliance – Compliance and Ethics Courses:

http://www.globalcompliance.com/Training-Education/Courses.aspx

12
Key Terms

 Corrective Action: The implementation of a systemic change or solution to make an

immediate and on-going remedy to a non-compliance.

 Management System: The framework of policies, processes, and procedures used to ensure
that an organisation can fulfil all tasks required to achieve its objectives.

 Preventive Action: The implementation of a systemic change or solution designed to prevent

the recurrence of the same or similar issues elsewhere in the facility.

 Whistleblower: An informant who exposes wrongdoing within an organisation in the hope of

stopping it. A whistleblower can be from within the organisation itself, from a supplier or
customer, or from the general public. Persons who act as whistleblowers are often the subject
of retaliation by their employers. Typically the employer will discharge the whistleblower.

13
 Copyright

All texts, contents and pictures on this publication are protected by copyright or by the law on trademarks. The publication is
subject to the copyright of ‘Sedex Information Exchange Ltd’. Reproduction is authorised, except for commercial purposes,
provided that “http://www.sedexglobal.com” is mentioned and acknowledged as the source. Copyright of third-party material found
in this site must be respected.

The information contained in this document is provided by Verité and while every effort has been made to make the
information complete and accurate and up to date, Sedex makes no representations or warranties of any kind, express or
implied, about the completeness, accuracy, reliability, suitability or availability with respect to the information contained
therein. Any reliance you place on such information is therefore strictly at your own risk. In no event is Sedex liable for any
loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever
arising from loss profits arising out of, or in connection with, the use of this document.

14
SEDEX SUPPLIER WORKBOOK

Chapter 4.2

ANTI-CORRUPTION
Anti-Corruption
What does it mean?

Corruption is making or receiving illegal or improper

payment for goods or services. Examples include
such things as ‘facilitation’ payments to government
officials to obtain needed government approvals or
‘kickbacks’ to customers in order to obtain their
business. Anti-corruption programmes help protect
companies and their employees against these and
other risks of bribery and corruption.

An effective anti-corruption program helps a company

understand its corruption and bribery risks, practice
good due diligence, and investigate and resolve reports
of unethical behaviour by employees of the company. Benefits
Why should you do it?
Bribery and corruption are issues faced by nearly all
companies. Those faced by small companies may
Establishing and implementing firm anti-corruption
be very different than the situations that challenge
policies and procedures will help you stay within the
large multi-national corporations. Whether a
law, avoid penalties and meet your customers’
company is large or small, the corruption risks it
requirements.
faces can fall into one or more of the following
categories: There can also be business benefits, such as:
 Geographic location a) Improving your company’s image and reputation.

 Business sector b) Achieving both your business and social

responsibility objectives.
 Use of business partners (contractors,
agents and other intermediaries) c) Building and maintaining customer trust.
d) Avoiding ethical dilemmas.
 Type of business transaction (for example:
permitting and public procurement) e) Reduced cost of doing business.
f) Less pressure to pay bribes.

If a company engages in or tolerates

corrupt business practices, it will be
widely known to its employees,
customers, suppliers, business
partners, and government officials.
Note: Please refer to the Business
Ethics Management Systems chapter for
This section will help you identify the risks in your
more information on controlling the risks
current business processes that could lead to of bribery, corruption and other business
knowingly or unknowingly engaging in corrupt ethics issues.
business practices and to put in place controls to
make sure bribery and corruption issues are properly
addressed.

16
 of political processes, impoverishment of societies
and damage to the environment.

Requirements It can also distort competition, distribution of wealth

What do you need to do? and economic growth.

Related actions and expectations

There are no ETI Base Code
Clauses that address corruption To prevent corruption an organisation should:
and bribery. However, anti- — Identify the risks of corruption and implement
corruption is an essential and maintain policies and practices that counter
component of corporate corruption and extortion;
responsibility and social
— Ensure its leadership sets an example for anti-
compliance. As such, Sedex
corruption and provides commitment,
recommends that members
encouragement and oversight for
establish programmes and
implementation of the anti-corruption policies;
procedures to control business ethics risks such as
bribery and corruption. — Support and train its employees and
representatives in their efforts to eradicate
Other International Standards and Guidelines: bribery and corruption, and provide incentives
for progress;
 OECD Anti-bribery Convention, establishes
legally binding standards to criminalise bribery of — Raise the awareness of its employees,
foreign public officials in international business representatives, contractors and suppliers about
transactions and provides for a host of related corruption and how to counter it;
measures that make this effective. — Ensure that the remuneration of its employees
 ISO 26000 (2010), Section 6.6, Fair Operating and representatives is appropriate and for
Practices, contains specific guidance on how legitimate services only;
companies can manage corruption risks: — Establish and maintain an effective system to
counter corruption;
Fair operating practices concern ethical conduct in
an organisation's dealings with other — Encourage its employees, partners,
organisations. These include relationships representatives and suppliers to report
between organisations and government agencies, violations of the organisation's policies and
as well as between organisations and their unethical and unfair treatment by adopting
partners, suppliers, contractors, customers, mechanisms that enable reporting and follow-up
competitors, and the associations of which they action without fear of reprisal;
are members. — Bring violations of the criminal law to the
6.6.3 Fair operating practices issue 1: attention of appropriate law enforcement
Anti-corruption authorities; and,
— Work to oppose corruption by encouraging
Description of the issue
others with which the organisation has operating
Corruption is the abuse of entrusted power for relationships to adopt similar anti-corruption
private gain. Corruption can take many forms. practices.
Examples of corruption include bribery (soliciting,
offering or accepting a bribe in money or in kind)
involving public officials or people in the private
sector, conflict of interest, fraud, money
laundering, embezzlement, concealment and
obstruction of justice, and trading in influence.

Corruption undermines an organisation's

effectiveness and ethical reputation, and can
make it liable to criminal prosecution, as well as
civil and administrative sanctions. Corruption can
result in the violation of human rights, the erosion

17
 FCPA – Foreign Corrupt Practices Act (1998)
requires:
— Due diligence on customers, the nature of
their business and the types of financial Achieving and Maintaining Standards
transactions they undertake. How do you do it?
— Conducting senior management meetings
where the risks of bribery and corruption are You can best meet standards by using a systems
reviewed, discussed and recorded. approach. In other words, you add controls to the
— Staff training. processes you already use to run your business (such
as procurement and permitting) and you make sure your
— Independent monitoring.
policies and procedures are designed to ensure that:
 Sarbanes-Oxley Act (2002) requires companies
‘to protect investors by improving the accuracy  There is no pressure to make facilitation payments
and reliability of corporate disclosures...’ in order to ensure prompt shipment of products from
ports and airports.
 UK Bribery Act (2010) creates the following
offences:  Company employees are not faced with requests
from customers for favours, gifts or kickbacks in
— Active bribery: promising or giving a exchange for orders.
financial or other advantage.
 You understand the bribery and corruption risks
— Passive bribery: agreeing to receive or faced by the company.
accepting a financial or other
 You establish and broadly communicate a company
advantage.
anti-corruption policy.
— Bribery of foreign public officials.
 When entering into business relationships with
— The failure of commercial organisations partners, agents and contractors, you perform due
to prevent bribery by an associated diligence to learn their business practices.
person (corporate offence).
 You evaluate the company’s compliance with the
 UN Global Compact, Principle 10: Businesses US Foreign Corrupt Practices Act, UK Anti-Bribery
should work against corruption in all its forms, Act and other applicable legal requirements.
including extortion and bribery.
 There is a procedure for company employees and
external parties to report allegations of bribery and
corruption and no procedure to investigate such
allegations.

 There is no intimidation or punishment of workers for

raising issues of bribery or corruption to company
management.

 Company managers and employees follow the

established anti-corruption policy and procedures.

It is important that you also regularly monitor your

processes and controls to make sure they are working.

18
Policies Best Practice
(rules)
Due Diligence
Your company policies should include the following When your business depends on the use of
commitments: contractors, vendors, agents and other
intermediaries, due diligence is a must. Be sure
 Written public statement that ethical business to take a risk-based approach when working with
practice is a core value, supported by the owner, any persons or organisations that provide goods
board and senior management, and the company and services to or on behalf of the company, in
will not participate in or tolerate any kind of order to identify and control bribery and
bribery or corruption corruption risks.

 The company will comply with all legal and

customer requirements concerning bribery and
corruption.

 All allegations of ethical misconduct reported to Procedures

the company will be thoroughly investigated and (practices)
addressed.
Management should appoint a responsible person (or
 The company will cooperate with investigations department) to make sure these policies are carried out
regarding bribery and corruption conducted by through the following practices:
government agencies.
 Communicating your policies to all managers,
 Company employees will only provide and supervisors and workers.
accept gifts that are of nominal value and only to
foster goodwill in business relationships.  Making sure that all managers and employees of
the company have clearly defined roles and
 Company will demonstrate ethical business responsibilities for carrying out your anti-corruption
practices through transparent financial reporting. policies.

 Meeting regularly with managers and supervisors

responsible for procurement, finance, sales and
supplier and contractor selection and management
to oversee implementation.

 Working with the individual or department

responsible for the company’s bribery and
corruption allegation reporting process to make
sure that alleged issues are addressed.

 Monitoring and following up on all concerns and

issues related to the implementation of anti-
corruption policies and procedures.

 Performing an annual review of your anti-corruption

programme to make sure it is effective and
achieving your objectives, and to make any
required adjustments.

 Maintaining and controlling all records relating to

allegations and investigations of bribery and
corruption.

19
  A code of behaviour (business conduct) for
managers, supervisors, and employees that aligns
with international anti-corruption standards, local
laws and regulations, and customer requirements.

 A formal process to screen, select and monitor

your business associates, including agents and
suppliers, to assess their compliance with your
policies and business ethics laws and regulations.

Corruption and Bribery ‘Red Flags’

 Business partner refuses to certify
compliance with anti-bribery legal
requirements.
Your anti-corruption procedures should include:  Business partner refuses to participate
 A bribery and corruption risk assessment in due diligence regarding relationship
process by which the company can understand with or interests involving government
and rank risks presented by country, business officials.
sector, business partners, and types of business  A company or individual does not
transactions. appear to be qualified to deliver the
services for which it has been
 Ways to track and understand laws and engaged.
regulations on bribery and corruption.
 Bribery and corruption reputation of
 A formal process for workers, managers, the country.
supervisors, suppliers, and customers to report  The industry sector has a history of
through secure and confidential channels any corruption issues.
concerns regarding the implementation of anti-
 Potential business partner is related to
corruption policies.
a government official with jurisdiction
 Methods to ensure confidentiality and prevent over your business.
retaliation against workers who raise concerns.  Requests for commissions to be paid
to a third party, or in cash or
 A procedure that limits the amount and frequency untraceable funds.
of business gifts that employees can give or
receive from suppliers and customers and  A desire to keep third party
ensures that such gifts are open and genuine representation secret.
and not related to a current business transaction.  Relationship problems with other
companies.
 Process that specifically prohibits bribes,
kickbacks and other types of corruption, and
includes the consequences for doing so.

 A process for management to investigate

reported allegations of bribery and corruption,
take action and communicate the results to
workers.

 A clear process for discipline and termination

as a result of proven acts of bribery and
corruption.

20
Communication and Training

You should use the following methods to make sure

your employees are aware of your anti-corruption scenarios in the training that are tailored to local
policies and procedures: issues and culture.

 Display anti-corruption policies and local legal

 Provide training programs for new managers and
requirements in areas where all employees will see
supervisors and newly hired workers on your them and in a language they understand.
company’s policies and procedures on anti-
corruption.  Communicate the company’s anti-corruption
requirements, as well as the laws and standards, to
 All employees must be provided with on-going
the company’s suppliers and vendors using your
tailored training and information on the bribery
website, in contract terms and conditions, and
and corruption issues associated with their jobs
during periodic meetings.
using classroom training, team and department
meetings, written materials, and work area  For allegations of policy violations, make sure
postings. workers know when to report and how to report
 Make sure the training covers all applicable (and to whom).
business ethics laws and regulations, and use

21
 Training should emphasise the standard way to
apply the anti-corruption procedures so that all
supervisors and managers do it the same way.

 Communicate internal regulations to all workers

through postings and by providing workers with
the policies in an employee handbook.

Documentation and Records

Meeting standards requires proper documentation.

You will need to keep on file on company premises:

 Copies of your anti-corruption policy signed by

senior management or the board.
Note: Your company may have a business ethics
policy that covers all ethics issues and is not
specific to anti-corruption.

 Copies of all applicable laws and the facility’s

Best Practice
legal responsibilities for anti-corruption. Accepting an expensive gift from a supplier
can send the wrong message to both
 Copies of key anti-corruption procedures, such
suppliers and your fellow employees. You
as giving and receiving gifts, facilitation
payments, reporting allegations of misconduct, should never give or accept gifts of more
and others as needed. than nominal value. If you are given an
expensive gift, notify your manager and
 Records of reporting to Management and Board, send it back to the giver with a note
including Management and Board of Directors
explaining the company’s gift policy.
meeting minutes, action items, and attendance
records.

 Copies of internal and third party business and

financial audit reports, and inspection reports by
regulatory agencies.
Monitoring
 Records of allegations of bribery and corruption.
You will need to check if your anti-corruption policies are
 Anti-corruption investigations, corrective action
being followed and that controls intended to make sure
plans and reports, including documented
evidence of improvements made. the company is meeting code and legal requirements are
effective. The following steps can be used to evaluate
 Documentation of any disciplinary proceedings and improve the effectiveness of your programs:
and actions taken for proven cases of bribery
and corruption, including the following 1. Monitor trends and statistics to identify actual
information: and potential problems, including:

 Name of the employee.  Regularly review allegations of corruption.

 Summary of issue.
 Determine if employees, suppliers and
 Results of the committee’s discussions and customers are comfortable using the existing
the disciplinary action taken. reporting methods.

 Signature of members of the disciplinary  Establish and monitor key performance

committee indicators (metrics) to measure how well anti-

22
 corruption procedures are working (for results to improve your company anti-corruption
example, ‘all allegations of corruption are policies and procedures.
investigated and addressed with two weeks’
or ‘90% of employees surveyed understand
the company’s anti-corruption policy.’)

 Periodic review and revision of anti-

corruption policies and procedures to keep
them relevant and up to date.

2. Investigate the problem and analyse why it

What does ‘Nominal Value’ mean?
occurs. If you have evidence that your anti- A gift is of nominal value if its cost
corruption policy (or customer’s code of conduct) or worth is so small that no one
is not being followed, you should investigate to
would think that it could influence
find out the root cause, and then address it.
the judgment of the person
The lack of allegations filed by workers, suppliers and receiving the gift.
others may not mean that acts of bribery or corruption
are not occurring. It could simply be that individuals
are not comfortable using your reporting procedure.
You should survey employees and suppliers to
determine if they are comfortable using your existing
reporting channels.
Another common reason given for not reporting
allegations of misconduct is that ‘management does
not respond anyway, so it is just a waste of time.’

 Make sure there is a procedure for following up

on corruption allegations and taking action
within a certain timeframe after it is determined
the report is justified.

 Review and analyse common violations of anti-

corruption rules to identify the root cause of
why they are being broken, and address them,
for example, with employee awareness training
or meetings with suppliers to review your
policies and contract terms.

 Carefully evaluate any threats made to your

employees for failing to make a facilitation
payment or take part in any other corrupt
activity. Serious threat may require involving
law enforcement authorities.

3. Work with other departments to identify

reasonable solutions. Take care to develop
solutions that make sure the problem does not
recur and the solution does not create other
problems.

Analyse issues and suggestions raised during

employee meetings, supplier forums and use the

23
 Common Questions
What kind of allegation reporting does my company
Is it ever appropriate to accept a gift or business need?
courtesy from a supplier? As with your grievance procedure (see the ‘Discipline
It depends on the situation. You should not accept and Grievance’ chapter), your reporting process must be
anything of value from a current or prospective anonymous and must protect the person or organisation
supplier or vendor if there is a competitive bid or making the allegation from reprisal. It is suggested that
other procurement process pending or underway. a specific individual or department be assigned to
manage the process. This person should have no
If you work in purchasing or procurement or in a responsibilities in purchasing, procurement, contracting,
similar role, you should not accept gifts or business or managing contractors and vendors.
courtesies from anyone who may seek contracts or
business from the company. However, if you do not The reporting mechanism can be a hotline phone
make procurement or contracting decisions and work number, email, or a special postal address. Each of
with an existing supplier on a regular basis, some these communication channels must be accessible only
business courtesies may be allowable. For example, by the designated person or department.
it might benefit your company to have lunch with a All reports of misconduct should be thoroughly
business partner if the lunch is a meeting to discuss investigated and the results of the investigation
business issues and build working relationships. That communicated back to the person or organisation
is a valid business purpose. In contrast, it does not making the report (if known).
benefit your company to accept gifts of personal
items, such as jewelry.
If in doubt, politely refuse the gift or courtesy, or ask
your manager for guidance.
Common Audit Non-compliances from
the Sedex Database
Best Practice The following are the most common non-compliances
In order to reduce the threat of bribery against this issue. If properly implemented, the guidance
in this chapter can help reduce the incidence of these
and corruption in your locale, work
problems:
with other companies to adopt the
same or similar anti-corruption policies  Inadequate code and system implementation.
and practices.  Inconsistent recordkeeping.
 No general management systems in place.
What does it take to perform due diligence on a  Lack of employee awareness of the social and
prospective business partner? ethical standards the company upholds.
The type of due diligence depends on the potential
risk of the engagement. In low risk situations, your Sedex provides a document with suggested possible corrective
actions following a SMETA audit. This is available to Sedex
company may decide that there is no need to conduct
members only in the Sedex Members Resources section:
any due diligence. In higher risk engagements, due Sedex Corrective Action Guidance
diligence may include conducting direct questioning of
the prospective partner, indirect investigations, or
general research on proposed associated persons or
organisations. Appraisal and ongoing monitoring of
‘associated’ persons, once engaged, may also be
required, depending on the identified risks. Generally,
more information is needed from prospective and
existing companies than from individuals.

24
 Case Study Among the Coalition’s 2013 objectives is to sign up
200 additional companies. Meanwhile, with the
Anti-Corruption: Combat through Alliance assistance of TI, Diageo will continue to provide
training programmes to companies who have already
Corruption has financial costs, impacts on signed up to the initiative, to help organisations and
management time and resources, and can impair companies embed core values such as respect for
reputation. To prevent corruption in your supply the rule of the law, probity, accountability, integrity
chain, it is critical to focus on capacity building, and transparency. The Coalition is committed to
implementing systems and building comprehension. supporting organisations to practically and
consistently embed ethics and compliance principles
Diageo subsidiary Guinness Cameroon SA was
in their day-to-day business, by creating a platform
having multiple issues with corruption, such as
for public bodies and private companies to combat
drivers being stopped on the road and asked for
corruption together.
money due to a real or imaginary infringement.
“We are convinced that this initiative will make a
“These were frustrating as employees knew that
difference in Cameroun as we plan for the third phase
paying these bribes was against company policy and
of the project when we aim to introduce anti-
was adding unnecessary complications to doing
corruption legislation. The results on the ground are
business,” says David Lawrence, Compliance &
visible with Guinness employees experiencing
Ethics Programme Director. Diageo decided to use
significantly reduced levels of interference at airports,
its position as a leading company in the country to
on the roads and at customs.”
influence the government to commit to legislate
against corruption. Diageo is the world’s leading premium drinks business with
its products sold in more than 180 countries around the
Diageo gained Government sponsorship and brought world with manufacturing facilities across the globe. To find
together sixty other companies, NGOs and out more about Diageo, visit: http://www.diageo.com.
government bodies to discuss ways of tackling
corruption; who, by signing up to an anti-corruption
pact, formed the Business Coalition against
Corruption in Cameroun. The aim was to better
develop the government’s anti-corruption agenda
and it was officially launched in 2011.

The event, which included a presentation by Sedex is always looking for new
Transparency International (TI), the world’s leading case studies. If you have a best
anti-corruption NGO, made the front page of the practice example case study
main national newspaper, showing the importance that you would like to be
and impact it had in Cameroun and that corruption featured, please send it to
will not be tolerated. content@sedexglobal.com

In 2012, a partnership project was initiated between

the German Development Cooperation and the
Business Council for Africa. The project’s second
phase sees the establishment of a permanent office
for the Coalition, with the appointment of a project
manager supported with a budget of €200,000. An
event attended by several ministers, including the
Prime Minister, and the Head of Police, marked the
occasion.

25
Resources and Guidance

The following organisations, websites, and documents provide additional information on anti-corruption:

 Sedex Members Ethical Trade Audit (SMETA) Best Practice Guidance: http://www.sedexglobal.com/wp-
content/uploads/2012/07/SMETA-Best-Practice-Guidance-4-Pillar-4_0-L.pdf

 SMETA Corrective Action Guidance (behind member log in):

https://www.sedex.org.uk/sedex/go.asp?wsfedsession=0

 SMETA Draft Supplement for Environment and Business Practices Process (2010) (behind member log in):
https://www.sedex.org.uk/sedex/go.asp?wsfedsession=0

 Ethical Trading Initiative (ETI):

 Principles of Implementation: http://www.ethicaltrade.org/resources/key-eti-resources/principles-
implementation

 International Organisation for Standardisation (ISO): ISO 26000 – Social Responsibility:

http://www.iso.org/iso/home/standards/iso26000.htm

 UK Bribery Act: http://www.fco.gov.uk/en/global-issues/conflict-minerals/legally-binding-process/uk-bribery-

act

 US Foreign Corrupt Practices Act: http://www.justice.gov/criminal/fraud/fcpa/

 Sarbanes-Oxley Act: : http://www.soxlaw.com/

 OECD, Good Practice Guidance on Internal Controls, Ethics, and Compliance:

http://www.oecd.org/investment/briberyininternationalbusiness/anti-briberyconvention/44884389.pdf

 Transparency International
 Business Principles for Countering Bribery:
http://www.transparency.org/whatwedo/tools/business_principles_for_countering_bribery/1/

 Business Principles for Countering Bribery – Small and medium enterprise (SME) edition:
http://www.transparency.org/whatwedo/tools/business_principles_for_countering_bribery_sme_editi
on/1/

 Adequate Procedures: Guidance to the UK Bribery Act 2010: http://www.transparency.org.uk/our-

work/publications/10-publications/95-adequate-procedures-guidance-to-the-uk-bribery-act-2010

 UN Global Compact - Transparency International Reporting Guidance on the 10th Principle against
Corruption: http://www.unglobalcompact.org/docs/issues_doc/Anti-Corruption/
UNGC_AntiCorruptionReporting.pdf

26
Signposts to Training

 ISO 26000: http://www.ethicalperformance.com/training/course/40

 Transparency International: http://www.transparency.org.uk/ti-uk-programmes/training

 DuPont Sustainable Solutions – Ethics and Compliance Training: http://www.training.dupont.com/human-

resources-training

 Global Compliance – Compliance and Ethics Courses: http://www.globalcompliance.com/Training-

Education/Courses/Course-Library/Global-Anti-Corruption-Training.aspx

 UK Anti-Corruption Forum – Anti-Corruption Training: http://www.anticorruptionforum.org.uk/acf/fs/training/

Key Terms
 Absenteeism: A measure of the number of workers who do not come to work when
they are scheduled to do so.

 Conflict of Interest: When someone has competing personal or professional financial interests or obligations
that could wrongly influence that person’s decision making.

 Due diligence: The investigation or audit of a potential business partner (individual or company) before
entering into a contract, in order to determine the corruption or bribery risks of the engagement.

 Facilitation payment: A form of bribery made for the purpose of expediting or ‘facilitating’ performance of a
routine government action by a public official, such as approval of a shipment from a port or airport.

 Nominal value gift: A value so small that it is not likely to influence the judgment or behaviour of the recipient.

 Reprisal: Unjust punishment of an individual worker for filing an allegation of bribery or corruption.

27
 Copyright

All texts, contents and pictures on this publication are protected by copyright or by the law on trademarks. The publication is
subject to the copyright of ‘Sedex Information Exchange Ltd’. Reproduction is authorised, except for commercial purposes,
provided that “http://www.sedexglobal.com” is mentioned and acknowledged as the source. Copyright of third-party material
found in this site must be respected.

The information contained in this document is provided by Verité and while every effort has been made to make the
information complete and accurate and up to date, Sedex makes no representations or warranties of any kind, express or
implied, about the completeness, accuracy, reliability, suitability or availability with respect to the information contained
therein. Any reliance you place on such information is therefore strictly at your own risk. In no event is Sedex liable for any
loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever
arising from loss profits arising out of, or in connection with, the use of this document.

28