No One Has Ever Become Poor By Giving!

Moving Forward on Corporate Integrity

Moving Forward on Corporate Integrity
Press Releases

Issued in conjunction with UN Anti Corruption Day.

To commemorate United Nations Anti Corruption Day on 9 December, Transparency International Malaysia (TI-M) reiterates the importance of addressing corruption in the private sector. The corruption level of a country not only reduces resources for the provision for the basic needs of citizens but also affects the external perception of the country.

For Malaysia, being a large trading nation, the perception of foreign direct investors is very significant. Hence having strong controls on corporate governance and anti corruption measures will greatly enhance the capabilities of private sector companies to detect and address the threat of corruption, and improve Malaysia’s international standing.

In Malaysia, the Corporate Integrity Pledge (CIP) was launched by the government in March 2011 for private organisations that are committed to fighting corruption. To date, 53 organisations ranging from large Government Linked Companies (GLC) and Multi National Companies (MNC) to smaller Small and Medium Enterprises (SME) have signed the CIP. While the signing of the pledge is an important first step, firm follow up actions are required to translate the pledge into tangible actions and results. To achieve this, TI-M has worked with one of the signatories to the Pledge to implement a Corporate Integrity System (CIS). The CIS is based on the 6 Step Programme designed by TI’s Private Sector team, and has been implemented in numerous companies worldwide.

It involves independent auditing of a company’s existing policies, identifying areas for improvement, creating policies, implementing and training relevant department staff for sustainable applications. The result is a practical and effective system which has clear guidelines to staff in high-risk areas such as procurement, finance and sales.

TI-M believes initiatives such as the CIP have assisted in improving Malaysia’s perception among the global investment community this year. However, more action can and must be taken to fight corruption. As highlighted in the worldwide Bribe Payers Index results released last month, bribery between companies across different sectors is seen as just as commonas bribery from firms to public officials.

To complement the CIP, TI-M recommends the following initiatives be undertaken by the government:

• To continue to diligently implement the United Nations Convention Against
Corruption (UNCAC) including the criminalization of bribery

• To strengthen the regulatory framework on the private sector to meet international accepted practice of good governance and ensuring integrity compliance through the adoption of an integrated corporate integrity system that includes the enforcement of anti-bribery policy

• To amend current legislation to allow prosecution of a company when its employee is prosecuted for corrupt practices

• Enforce strong deterrent fines

Given the strong international push for anti corruption measures and passage of anti bribery legislation such as the Foreign Corrupt Practices Act in the US and the UK Bribery Act, it is imperative that Malaysia shows its commitment to addressing private sector corruption. A firm commitment to fight corruption and effective anti corruption measures can translate into results which will support our nation’s aspiration to be a high income and developed country by the year 2020.

Issued by

Transparency International Malaysia

Datuk Paul Low, President