Singapore raising the bar in the fight against corruption

Singapore’s reputation as a “clean” country did not come by chance. It is the result of decades of strong political will to sustain a robust and comprehensive anti-corruption framework, and build a society that frowns on corruption.

Recently, the city-state received a boost of confidence with the Corrupt Practices Investigation Bureau (CPIB) revealing that corruption cases locally fell to a 32-year record low in 2016. Notwithstanding this, incidences of bribery and corruption continue to arrest public and media attention locally and globally, and unethical conduct remains one of the most pertinent risks to organizations.

Given that many Singapore companies have business relationships with other parties overseas, particularly as the call for international growth and expansion grows, the exposure to bribery and corruption potentially widens and intensifies.

It is therefore timely that the CPIB and SPRING Singapore collaboratively launch the new Singapore Standard, SS ISO 37001:2016 Anti-Bribery Management Systems, a certification program that aims to help Singapore companies strengthen their anti-bribery compliance systems and processes.

The standard, although voluntary in nature, sends a clear signal of the country’s unwavering stance on maintaining a transparent and honest environment with zero tolerance for corruption. It is also a significant step in enabling Singapore companies to combat bribery by providing specifications on the leading practices to establish, implement and maintain, as part of continually strengthening the internal controls in the company.

Adopting the standard have clear benefits for Singapore companies. With the operating environment becoming more complicated and corruption risks more transnational in nature, it helps them to better safeguard against bribery not just locally but overseas. It also provides assurance to market regulators that the company is aligned with the latest guidelines and standards, and garners the confidence of customers and stakeholders. All of these combine to lend a competitive advantage, for example in a tender bid exercise where the need for extensive due diligence can potentially be reduced.

Not a magic pill

Yet, the implementation or adoption of the standard in itself does not eradicate all unethical ills. The effectiveness of this standard depends predominantly on the commitment of the company management to establish the right tone at the top, an ethical culture and clear anti-bribery policies that are enforced through a governing body and compliance function, and supported by adequate training and investments in proactive monitoring tools.

For one, management needs to continue to drive a stronger nexus between policies and improved behaviors. 2017 EY APAC survey had found that even as Singapore executives say their companies’ efforts to combat fraud, bribery and corruption have been increasing or stayed the same, a massive 85% respondents want to change their organizations ABAC policy to make it more understandable. Specifically, they think existing policies are too long and use unnecessarily complex language (including legal jargon).

Companies should also keep in mind that being certified does not mean regulators and enforcement authorities will accept that anti-bribery standards have been met. Neither does it provide an auto-defense to punishment should a bribery or corruption incident occurs, even though authorities will usually consider the anti-fraud controls in place when determining the penalty or prosecution.

Taking the next step

The SS ISO 37001 is based on similar ISO standards such as SS ISO 9001 for quality management and ISO 14001 for environmental management. Accordingly, companies that have some exposure or are already certified with other ISO standards, may draw some familiarity from the structure and elements to swiftly incorporate SS ISO 37001. The standard can therefore be established independently, or integrated into a pre-existing overall management system.

Companies that are keen to embark on the certification should firstly conduct an assessment of the existing internal controls and processes that address bribery-related risks. The assessment should provide an accurate representation of the maturity level of the current programs and using that, companies can then determine how comprehensive the certification process will be with respect to the costs, resources and duration required. Periodic renewal through audits will also be necessary, and companies must consider the additional investments beyond the initial certification.

Clearly, the Singapore government is taking additional steps in the right direction to raise the bar on anti-bribery in our business ecosystem as a whole. The effectiveness of the standard remains firmly in the hands of companies.

Importantly, adopting the standard should not be seen as a point-in-time certification or management exercise. Seen and done in the right spirit, anti-bribery is a continual journey, and a collective effort by everyone through the ranks and across functions. Getting the human element right is key. As with all unethical behaviors, it starts and ends with human.

This article has been co-authored with Belinda Tan, Partner, Forensic & Integrity Services, EY Singapore and was first published in Singapore Business Times 

Follow @EY_India and track #EYForensic for regular updates

One thought on “Singapore raising the bar in the fight against corruption

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.