Suggested Posts

The Aussie ABC Standard

* This article was originally published in the GRC Professional Magazine: Financial Crime Edition 2019.

Two years after the publication of the ISO37001 Anti-bribery Corruption certification, the date set for the publication of the Australian variant, AS ISO 37001, is 4 March of this year, at the time of writing.

Having an Australian variant of the certification is expected to encourage organisations to strengthen their processes around preventing bribery and corruption.

It has been barely a week since new whistle-blowing amendments passed both Houses of Parliament, ensuring greater protections for whistle-blowers in Australia.

ISO Certified CEO, Martin Tolar, told GRC Professional that the Australian version of the ISO standard has been long anticipated.

“What it means is that Australian firms that want to become certified under it can do so because it will give rise to the creation of a local certification scheme. Previously, firms had to be certified under ISO37001.“

He added that, previously, organisations would have to use the certification body running under the British ‘scheme’.

“The benefit in having the certification is that it will help businesses put in place and manage anti-bribery risks.” This will help lessen the likelihood of these incidents happening.

Tolar believes that having an Australian standard will reduce incidents of bribery and corruption to the level of anomalies, as opposed to something systematic.

Regulatory impact

Along with the adaption of the Standard, there will also be a handbook for guidance on how to approach it.

The new Standard may also have regulatory or legislative implications. Tolar said that, back in 2017, Attorney General Christian Porter made promises to revise and improve Australia’s approach to anti-bribery and corruption.

“From what I can tell, that whole process has stalled. So, we don’t have reforms in anti-bribery like what was promised in 2017, and we don’t have the Commonwealth-level ICAC [Independent Commission Against Corruption].”

However, having the Standard and handbook to assist organisations will be in apposition to any potential regulations that might come arise from having a ‘true blue’ version of the international standard.

“We are so bad at the moment, in terms of this issue at the Federal level. It’s actually embarrassing from an international point of view,” Tolar said. “The real benefit will be for those organisations that have international exposure.”

According to Tolar, the major benefit or impact will be on those companies that have global exposure and that fall under the jurisdiction of the Department of Justice (DOJ), the Foreign Corrupt Practices Act (FCPA) requirements, and the UK Bribery Act.

“The challenge is that the local legislation is outdated and there isn’t a regulator to enforce the regulation.”

The other issue Tolar highlights is the challenge of Federal Parliament.

“If you talk about ‘tone from the top’ and leadership and leadership values in this space, you can really look no further than Canberra at the moment.”

Last year, there was a sense that Australia was going to take a stronger stance against anti-corruption.

At the Lexis Nexis Risk and the GRC Institute event early last year, speakers Alyssa Phillips, Partner at Ashurst Lawyers, and Charles Thomas from Lexi Nexis Risk, urged attendees to look at the approach that other jurisdictions have been taking towards anti-bribery and corruption and to ensure their own policies and procedures are updated.

Phillips focused particularly on Section Seven of the UK Bribery Act that can hold a company liable for not preventing corruption.

“Top level commitment is very important,” said Phillips. “It’s very important that it is visibly shown from the highest level of management. Hopefully, the risks we see with ABC going forward should be enough to convince management that it is really important.”

Thomas laid particular emphasis on what was, at the time, new regulation in France, Sapen II, that not only required organisations to have written policies when tackling anti-corruption but that allowed the French regulator, Agence Français Anticorruption (AFA), under the Ministere de la Justice, to take the proactive step of fining companies for not having a policy, even if a crime had not been committed.

Thomas said these changes would prompt Australia to come into line with other jurisdictions, including:

  • Definition of a foreign public official: the Australian guidance is looking to expand the definition of a foreign public official to include candidates for office. The challenge here is that there can be multiple candidates per seat. Thomas suggested this might create a lot of ‘noise’.

  • Benefit that is not legitimately due: this helps clarify what a bribe actually is and could clear some of the challenges around facilitation payments.

  • Personal as well as business advantage.

  • Reckless bribery: this ties into the UK legislation around failure to prevent bribery and corruption.

  • Influencing someone in an official capacity.

Other standards in development

Last year saw the publication of ISO 37002 Whistleblowing Management Systems.

With the whistle-blowing protections being passed, Tolar said there are whistle-blowing provisions in the ABC standard and there will also be enhanced provisions in the ISO 19600 International Standard for Compliance Management, which is currently being rewritten.

“It will have a brand-new number—37301—and the biggest change is that it will go from being a guideline to a certification standard. So, in the not-too-distant future, organisations will be able to get their compliance framework certified against the ISO standard.”

No tags yet.

©2018-2019 by The GRC Institute - Governance, Risk & Compliance.  ABN: 42862119377