Building compliance culture

Anti-bribery, anti-fraud and export control are key issues for multinational companies developing their compliance systems. Du Jin, general counsel and assistant president at Shenzhen-listed Hytera Communications, offers some insights

INDEPENDENT R&D and compliance management are two effective corporate tools for their wielders to achieve high-quality and healthy development. In the process of Hytera’s globalisation and development into a leading provider of dedicated communication and solutions, we have come to heartily appreciate them both.

Therefore, in the past decade, while strengthening our R&D capabilities and enhancing our product competitiveness, we have also been committed to improving our compliance management in high-risk areas. This article shares our compliance methods and strategies from two main perspectives – anti-bribery and anti-fraud, and export control compliance – based on Hytera’s time-tested practical experience.

ANTI-BRIBERY AND ANTI-FRAUD

Anti-bribery and anti-fraud chiefly involve the implementation of compliance control, conducting of compliance inspection, collection of violation information, investigation over violation incidents or behaviour, and the handling of violators.

After collating prior cases of regulatory punishment on violations, as well as high-risk issues in industry practice, companies should establish their own compliance systems and guidelines in line with compliance requirements, and implement them in concrete business processes such as customer reception, expense reimbursement, travel management, and corporate responsibility donations, to ensure that each step of the business is supported by solid, well-enforced regulatory basis.

Establish a complaint and reporting mechanism.
Past cases indicate that the majority of anti-bribery enforcement investigations are initiated because of employees’ or third-party reports. Therefore, encouraging employees and third parties to report their known corrupted policies and conduct is an important part of any corporate anti-bribery and anti-fraud compliance system. Companies may provide internal reporting hotlines and require employees to indicate the reporting method in the signature area when sending external emails.

Reporting mechanisms of multinational companies should be established in both Chinese and English, or more languages, so as to receive reporting information worldwide. Upon receipt of such reporting, the audit department should at once investigate and verify the relevant information, strictly keep confidential the identity of the whistleblower, and strengthen both protection and reward for the whistleblower.

After investigating all cases reflected in reports, the audit department should submit the investigation results of confirmed matters to company leaders, and the employees involved will be punished in the forms of dismissal, demotion or public criticism based on the severity of the circumstances. A sound operation and guarantee mechanism, forming an internal closed loop, can effectively raise the collective awareness of anti-bribery and anti-fraud compliance among all employees.

Carry out anti-bribery compliance publicity and training.
Multi-level and multi-position compliance training should fully cover the company’s management, business departments and functional departments so as to thoroughly impress on the importance of constructing an anti-bribery compliance system, and shed light on the existing compliance structure and operation mechanism, effectively raising the employees’ collective awareness on the issue.

In addition, companies with a social media presence – such as operating an enterprise WeChat official account – can publish compliance publicity articles and share cases on such platforms. Recommended topics include commercial bribery, official embezzlement and compliance management, as well as content involving current compliance trends and high-profile corruption cases in various industries.