1. The Focus on Compliance and Ethical Conduct

2. Bribery Is Illegal Everywhere
Corruption is Not an Acceptable Business Model
Cultural Norms are NOT an Excuse

3. Intergovernmental Compliance Initiatives3

4. A Sharpened Focus on Anti-Corruption
"As President Obama has said, 'The struggle against corruption is one of the great struggles of our time'... Corruption is, simply put, a scourge on civil society. We must vigorously enforce our own laws that prohibit bribery... And we must work together to support our partners in anti-corruption enforcement." - Eric Holder, U.S. Attorney General (2009)

5. FCPA As An Example The FCPA is composed of two parts:
The Anti-Bribery Provision prohibits the offer, authorization, promise or payment of anything of value to a foreign official, international organization official, political party, party official, or candidate for public office in order to obtain or retain business. It applies to issuers, domestic concerns, or persons acting within the U.S.
The Accounting Provision only applies to companies issuing securities registered on U.S. stock exchanges and includes the following two provisions:
The Books and Records Provision requires issuers to accurately record transactions in reasonable detail.
The Internal Controls Provision requires public companies to maintain a system of internal policies and procedures sufficient to provide reasonable assurances that transactions are executed and recorded according to appropriate standards and under management’s specific or general authorization.

6. Anti-Corruption Enforcement
Penalties, Sanctions and Remedies Available
Self-Reporting and Cooperation with the SEC and DOJ
FCPA Compliance Monitoring Programs
Strong compliance emphasis through Corporate Governance

7. Current Enforcement Efforts
In 2016, 27 companies paid about $2.48 billion to resolve FCPA cases (FCPA Blog)
SEC and DOJ continued focus on prosecution of individuals; 10 pleaded guilty in 2016
Two "Declinations with Disgorgement" in 2016 (HMT LLC and NCH Corp.)
China, Canada, Germany, Spain and other EU countries are increasing enforcement
81 companies have public disclosures regarding ongoing or unresolved FCPA investigations (FCPA Blog)
FCPA "Books and Records" prosecutions becoming more prevalent

8. Government Proceedings
Source: Stanford Law School

9. Business And Compliance Programs

10. Good Ethics and Compliance
Hallmarks of an effective program:
Management commitment and a clearly articulated policy against corruption
Code of conduct
Compliance policies and procedures
Oversight, autonomy and resources
Risk-based assessment (not “one-size-fits-all”)
Training and continuing advice
Incentives and disciplinary measures
Third party due diligence
Confidential reporting and internal investigation
Continuous improvement through periodic testing and review

11. Policies & Procedures Understandable Use of scenarios & examples
Well defined terms
Consistently applied
Communicated broadly
Updated 11

12. Corporate Messaging Around Corruption
Strong "Tone-at-the-Top"
Strong "Tone-in-the-Middle"
Supportive Management
Communicate Values
Cultural Norm of Compliance
Reinforced
Enforced Equally 12

13. Training & Awareness Use Multiple Methods of Delivery Conduct Annually
Use Case Studies
Use of Games and Other Interactive Tools
Focus Training on Level of Risk
Stress Compliance as an Integral Part of How the Company does Business
Third-party Training
Record Attendance 13

14. Reporting & Response
Mechanisms for reporting policy violations or other misconduct
Reinforce "doing the right thing"
Whistle-blowing protection, confidential reporting
Guidelines for prompt resolution — have a plan in place
Independent/objective response to concerns
Investigation by trained/competent personnel 14

15. Communication LA
Communication
Educating employees and senior management on policy violations
Updates on policy revisions
Reinforce importance of doing the right thing and consequences for violating
company policy
Revised training materials
Report success of program 15

16. Importance of Attorney-Client Privilege and Work Product
Provides company with the ability to fully assess whether allegation or issue is supported by facts before reporting to Government and/or external auditors:
Not an attempt to hide information
If not privileged or if privilege is waived, company loses control over
information:
Misleading or false information could enter public domain and irrevocably harm the company and the individuals involved. 16

17. Key Considerations To Protect Privilege In An Audit Context
Applicability of the privilege to an audit may turn on whether the audit's
principal purpose is to assist counsel in providing legal advice.
Work product protection may turn on whether materials associated with the audit were prepared with an eye toward litigation.
Be careful about the role of accountants:
Use of auditors can result in waiver. 17

18. Lessons Learned Get the Lawyers and Internal Auditors talking early
Clearly define the role and expectations of all team members
Clearly define the purpose of the audit and how it differs from a traditional
financial audit
Explore all technology options to assist the audit
Fully understand the facility operations before going on-site
Build enough time into schedule for report writing and remediation
Carefully track and document remediation
Be prepared to find (and not find) issues
Communication with management and facilities is critical to success 18