THE RISKS OF BEING EXPOSED TO BRIBERY AND CORRUPTION
In this section you will learn about the global bribery and corruption risks map and learn some risks associated with procurement activities.
COURSE NAVIGATION
Here, you will be able to find information on how to use this CD and icon guidelines. You can also find link to download BP Code of Conduct.
1
Course
Navigation
Navigation
3
The Risks of Being Exposed to Bribery and Corruption
BRIBERY AND CORRUPTION IMPACT
This section outlines some lessons learned from global as well as local bribery cases and the magnitude of the impact of bribery & corruption.
4
Bribery
and
Corruption
Impact
and
Corruption
Impact
2
What is Bribery and Corruption?
WHAT IS BRIBERY AND CORRUPTION
In this section you will find what are the actions that may constitute as bribery and corruption practices.
5
Mitigating Bribery and Corruption
MITIGATING BRIBERY AND CORRUPTION
This section helps you to understand steps to mitigate bribery and corruption adopted at BP. BP requires its suppliers to also adhere to these arrangements.
Software/Hardware Requirement
This DVD is to be used with Windows/Mac OS.
BP Disclaimer
The documents containing ABC policies and procedures provided in this ABC Risk Management session are solely provided as an example of BP’s ABC policies and procedures as a resource for Contractor to refer to in addressing its ABC Risk Management. BP Berau Ltd. makes no representations or warranties concerning the effectiveness of the content of the documents to manage ABC risk as their implementation are a critical component.
These documents are proprietary to BP and are supplied in confidence for reference only and must not be adopted without alteration nor disclosed, duplicated or otherwise revealed in whole or in part to any third parties without the prior written consent of BP Berau Ltd.
Help !
COURSE NAVIGATION
Here, you will be able to find information on how to use this CD and icon guidelines. You can also find link to download BP Code of Conduct.
WHAT IS BRIBERY AND CORRUPTION
In this section you will find what are the actions that may constitute as bribery and corruption practices.
THE RISK OF BEING EXPOSED TO BRIBERY AND CORRUPTION
In this section you will learn about the global bribery and corruption risk map and learn some risks associated with procurement activities.
BRIBERY AND CORRUPTION IMPACT
This section outlines some lessons learned from global as well as local bribery cases and the magnitude of the impact of bribery & corruption.
MITIGATING BRIBERY AND CORRUPTION
This section helps you to understand steps to mitigate bribery and corruption adopted at BP. BP requires its suppliers to also adhere to these arrangements.
Bahasa
English
- We do not tolerate bribery and corruption in any of its forms in our business.
- We comply with Anti-Bribery and Corruption laws and regulations and support efforts to eliminate bribery and corruption worldwide. We work to make sure that our business partners share our commitment.
A bribe can consist of anything of value given or offered - directly or indirectly - with the intent to improperly influence someone.
Definition of Bribery & Corruption
Bribery means:
Giving or receiving an undue reward or something of value.
Exercising an improper influence on the behaviour of someone in business or government, so as to secure commercial advantage.
Corruption is the destruction - through bribery - of integrity, honesty and loyalty.
A bribe can be anything of value.
Bribery is the giving or receiving of an undue reward.
Bribery is the giving or receiving of an undue reward.
Any of the following may be bribes:
Gifts
Per diems and "shopping allowances"
Entertainment
Reimbursement of officials' expenses
Meals
The transfer of beneficial interest in a business
Providing employment for a relative of an official, either directly or by hiring the services of a company that they own or for which they work
In-kind contributions to an official
Offers of employment to an official
Unreasonable use of company facilities, vehicles or equipment
Improper Influencing of Behaviour
Influence a government official to award business to a particular company
Influence a government official to speed up a routine process - like granting a visa, or an operating permit
It doesn't matter what behaviour has been improperly influenced, just that it has been so influenced. Even the smallest influence counts as an influence.
Commercial Bribery
Bribery is not just limited to giving anything of value to government officials. Bribery laws also prohibit transfers of value between businesses when intended to improperly influence people to obtain a commercial advantage.
Bribery includes improper payments made between companies. Examples are:
- Payments made by a tendering company in a bid process
- Payments received by a company running a tendering process
- If you or BP receives something of value from another business which is intended to influence in the way you allocate BP's outsourcing of work this can be considered a bribe.
- If you give another company something of value in an effort to improperly influence them to give BP their business, this could also be considered as bribery.
Legal
Framework
Framework
- Most countries have laws prohibiting the bribery of their own government officials. These laws forbid making, offering or promising to make a payment or transfer of anything of value to government personnel or other officials for the purpose of improperly obtaining or retaining business. Many countries have laws that apply across the globe. For instance, UK and US citizens can be prosecuted and imprisoned in their home country for paying bribes abroad.
- BP plc is a UK company. It is incorporated in England and our headquarters are in England but our stocks are listed in both the UK and US stock exchanges and BP and its employees are - as a minimum - subject to both UK and US Anti- Bribery laws. Having operated in Indonesia, BP is also subject to the Indonesia Anti-Corruption regulation.
- UK law applies to corruption offences committed by UK companies and British nationals, whether in the the UK territory or abroad. US law also applies to BP, and its employees; and local laws of the countries in which BP does business apply to BP’s businesses and transactions in those countries.
- BP employees can be personally prosecuted and, if found guilty, jailed for bribery crimes committed whilst working for BP.
BP as a US & UK company operating in Indonesia adheres to:
We do not tolerate bribery and corruption in any of its forms in our business.
We comply with Anti-Bribery and corruption laws and regulations and support efforts to eliminate bribery and corruption worldwide. We work to make sure that our business partners share our commitments.
This includes prohibition to offer or accept bribes, kickbacks or any other kind of improper payment including facilitation payments.
Facilitation payments are payments made to a government official to secure or speed up routine, non-discretionary, legal government actions, such as issuing permits or releasing goods held in customs.
Bob Dudley
CEO BP
Bob Dudley
Statement
Statement
Bribery and corruption is an ever present risk in the global markets in which we operate. It undermines the rule of law, distorts these markets and can cause safety issues. It has a disproportional impact on the poorest countries and communities.
Standing up to bribery and corruption is rarely easy, but it is the right thing to do and our values require us to do so – we care deeply about how we deliver energy to the world and we hold ourselves to the highest ethical standards.
The Risks of Being Exposed to Bribery and Corruption
Indonesia and Corruption Perception Index (CPI)
The Risks of Being Exposed to Bribery and Corruption
Procurement Supply Chain Management (PSCM) and Risks of Bribery and Corruption
The penalties for bribery and corruption are extremely serious and apply not only to BP employees, but also to Contractors working for or on behalf of BP. Nearly all countries have relevant laws in place and anymore found to be involved in bribery and corruption could face large fines, imprisonment and disciplinary action through their employer.
Due to our dealings in high-risk jurisdictions, BP has always been exposed to a significant bribery and corruption risk, which we continue to take very seriously. The long-term enforcement trend shows inscreasing volume and severity of prosecutions globally.
We recognise that our Suppliers play an invaluable role in our business. This guidance is just one example of our commitment to protect both you and BP from the potential consequences of bribery and corruption.
We trust that when working on behalf of BP you will play your part by complying with all relevant laws and legislation and the BP Code of Conduct, which sets our minimum standards and often exceeds legal requirements. We expect you to understand and adhere to BP’s values. In the unlikely event that we believe an Agent has failed to comply with our requirements, we may suspend services and payments.
In summary, if you pay a bribe while working for us, BP could face a very large fine even if we didn’t know about, approve or invoice the bribe. We don’t want you to ignore breaches in order to complete or speed up projects. Event if progress is slower, it must be legal. If you have any doubt or problems, we want you to contact us. We may be able to help.
Global Cases of non-compliance that resulted in prosecution and penalty
SEC charges Baker Hughes With Foreign Bribery and With Violating 2001 Commission Cease-and-Desist Order
SEC Press Release, 26 April 2007
One of the biggest oil service company was found to have made improper payments for an oil field services contract in Kazakhstan. Total penalty and disgorgement of profits for bribery and corruption was USD 44 million.
Alcatel-Lucent pays $137m to settle US bribery case.
BBC News, 28 December 2010
Lucent was fined USD 2.5 million for improper hosting of Chinese government officials and required to implement a rigorous ABC compliance and monitoring program. It was also fined USD 144 million for books and records offences related to bribes in many countries including Taiwan, Malaysia, Honduras and Costa Rica.
Oil-for-Food Scandal Broadens With New Charges.
The New York Times, 14 April 2005
Chevron accused of illegal payments to officials in the Iraq Oil-for-Food Program and fined USD 30 million.
FSA fines Aon record £5.25m over 'financial crime' controls
Bloomberg, 17 Dec. 2012
Aon Limited fined £ 5.25 million for failing to take reasonable care in controlling payments made to overseas firms and individuals.
Diebold Settles Foreign Bribery Cases for $48.1 Million.
Bloomberg, 23 October 2013
Diebold Inc. (DBD), a maker of ATMs and bank security systems, agreed to pay more than $48 million to settle allegations by the U.S. that it bribed officials in Russia, China and Indonesia.
Allianz Pays $12.3 Million to Settle Indonesia Bribe Claim.
Bloomberg, 17 Dec. 2012
Allianz SE (ALV) will pay more than $12.3 million to settle U.S. SEC claims that it made improper payments to government officials in Indonesia during 7 year period.
ABB Settles Charges in Bribery Case.
The Wall Street Journal, 07 July 2004
ABB Vetco companies admitted to making illegal payments to win oil contracts in Nigeria and was fined a total of USD 16.4 million in 2004 and then again in 2007 were fined USD 26.7 million and required to implement a rigorous compliance and monitor program for payments to Nigeria customs.
Local Cases of non-compliance that resulted in prosecution and penalty
Indonesian Energy Minister Resigns in Corruption Scandal
Channel News Asia, 05 September 2014
Indonesia’s Energy Minister stepped down Friday, 5 Sep. 2014 after Anti-Corruption officials named him a suspect in the latest graft case.
Chevron staff arrested in Indonesia
Financial Times, 27 September 2012
Four Indonesian employees of Chevron have been arrested in connection with an investigation into alleged corruption at an environmental remediation project in Sumatra
Jakarta Corruption Court: Former Energy Ministry Staff Gets Six Years Prison.
Tuesday, 6 March 2012
Indonesian Religious Affairs Minister Suryadharma Ali Sets as Corruption Suspect.
Bloomberg, 17 Dec. 2012
Nunun gets 2.5 years, others to follow.
The Jakarta Post, 10 May 2012
Former SKK Migas Chief Gets 7 Years Jail for Graft.
Rigzone, 30 April 2014
Life sentence for Indonesia Constitutional Court Judge Akil Mochtar.
Deutsche Welle, 30 June 2014
Angelina Sondakh Sentenced to 12 Years Jail time by the Supreme Court.
The Jakarta Globe, 21 November 2013
Key Steps to Mitigate
Due diligence
Contracts
Training and Communications
Monitoring
Remedial Action
1. During Procurement Process
Conduct Counterparty Due Diligence (CDD) in qualification process
Communicate ABC/AML - Anti-Bribery and Corruption/Anti Money Laundering requirements in pre-bid meeting
Include standard ABC/AML clause in Tender document
Conduct pre-award ABC interview and/or ABC/AML engagement
Communicate ABC/AML requirements in kick-off meeting
2. During Contract Executions
Monitor Contractor’s Compliance with ABC/AML reruirements in performance review meeting
Counterparty Due Diligence (CDD) refresh
Obtain Certificate of Compliance
Improve Supplier ABC/AML understanding and compliance processes
Conduct SAC (Supplier Audit & Compliance)
Review the programs in place to protect the supplier and thus BP from violations of the Indonesian Anti-Corruption law, UK Anti-Bribery law and the US FCPA law.
Review transaction level details to attempt to identify any potential bribes or facilitating payments.
3. Training and Communication
Regular Code of Conduct Forum for contractors
Anti-Bribery and Corruption and Code of Conduct training/ workshop for contractors
Anti-Bribery and Corruption interview during pre-award and contract implementation
Face to Face discussion
4. Key Principles for monitoring and managing your counterparty
Contract Owners
Ensure suppliers understand our expectation on compliance to ABC/COC
Monitor contractor’s performance (both on work delivery and compliance)
Robust review of invoices:
- Within the scope of contract
- Sufficient supporting docs
- Signed by authorized person
PSCM and E&C
Supplier Audit & Compliance (SAC)
Certificates of compliance
5. Remedial Action - Always consult with BP Legal and E&C before taking action
Take appropriate action immediately
Actions may include:
- Independent investigation by E&C
- Suspension of payment
- Ensure correct entries of books and records
- Exercise audit rights
Breaches require remedial actions
Consider whether the company can rehabilitate itself
Be prepared to terminate the contract
Supplier undertakes to comply with US-FCPA, UK Bribery Act , and Indonesian Anti-Corruption laws
Bribes and “facilitation” or “grease” payments explicitly prohibited
Supplier must conduct appropriate due diligence before hiring a subcontractor
No bribes or cash gifts to anyone at BP
No government official has an interest in the contract or its proceeds unless the contractor is a government agency
Supplier will apply effective controls and keep accurate records and accounts
Supplier consents to Anti-Corruption audits by BP and will provide compliance certificates
Payments only to Supplier’s bank account
BP has right to suspend payments or terminate contract for non-compliance
1st Line of Defense
Control
This describes the controls an organisation has in place to deal with the day-to-day business i.e. to establish policies/procedures that give employees ownership of risk management (e.g. Code of Conduct, Anti-Corruption policy, Gifts & Entertainment/ Government Hosting policies, etc).
2nd Line of Defense
Oversight
This describes the functions (and committees) that are in place to provide an oversight of the effective operation of the internal control framework i.e. to build a compliance function to interpret rules, provide trainings and advise the business.
3rd Line of Defense
Assurance
This describes the independent assurance provided by the board’s audit committee, and the internal audit function that reports to that committee i.e. to establish internal audit and use external audit providers which report independently to the management.
Mitigating Bribery and Corruption
Gifts & Entertainment (G&E) Policy – Dos and Dont's
- Related to BP’s project, G&Es are allowed:
G&Es that are usually acceptable:
Meals: modest occasional meals with someone with whom we do business;
Gifts: gifts of small nominal value, such as pens, calendars, or small promotional items.
Never acceptable Cash or equivalent (vouchers, gold)
G&E during tender process
Involving indecent or sexually oriented entertainment
IdulFitri/Christmas/New Year and other festivities gifts or parcels
Cash gifts at wedding of government officials and suppliers / contractors / agents
- All G&E (whether it’s received or given, accepted or declined or promised) must be recorded and granted appropriate approval from authorized person.
Hosting government officials related to BP’s project is allowed under below requirements:
Legitimate business purpose exist
Provided in kind (eliminate cash payments)
Only necessary officials that can be hosted
Expenses are reasonable and transparent
Contractors must inform BP’s Project Manager or Contract Owner every time there is a hosting initiative.
Contract Owner/ Project Manager will need to submit GH request and obtain BP Legal approval.
All GH must have BP Legal approval prior to the event.
Employee of government institutions, e.g. police, military, customs, immigrations and others.
Employee of enterprises in which government owns major interest (≥ 50%) e.g. national airline/railway/shipping.
Individual or institution acting in any official administrative, legislative or judicial capacity for/on behalf of government agencies.
Public international organizations
Political party officials and candidates for public office
Each employee must avoid situations which do, or which appear to, present a conflict between their personal interest (including close relatives who work for suppliers) and the interests of BP.
Actual conflicts must be avoided, but even the appearance of a conflict of interest can be harmful too.
Any personal conflicts of interest between our employees and BP suppliers will not be tolerated.
Each contractors’ employee who has potential conflict of interest must declare and inform the situation and mitigation action to the line manager and BP’s Project Manager or Contract Owner.
Speak Up! Embedding a ‘Speak Up’ culture is essential to preventing the damage caused by unethical or unsafe behavior.
Everyone shares a responsibility to speak up whenever we have a question about our Code or think it may have been violated.
To prevent an issue or concern from turning into a crisis, seek advice as soon as you can.
Embedding a Speak Up culture in BP is an essential part of restoring trust and value to our brand. If people feel free to speak up confidently, without fear of retaliation, about wrongdoing, poor safety or unethical behaviour, we don’t just save face. We can save lives. To achieve this we have to listen, and act, impartially and expertly. And so, we all have the responsibility to speak up.
If you or anyone you work with suspect a bribe or any misconduct
against BP Code of Conduct you must immediately escalate it to:
Your PSCM Category Specialist
BP’s Ethics & Compliance
Email: [email protected]
Hotline: 021 7854 9898
BP’s independent hotline (Open Talk): 021 7854 8899
It is open to BP Employees, Contractors, and Vendors.
We want you to speak up too!
Quiz
- 1Government official has been asking ‘small payment’ to smooth up a permit related to your contract with BP, what should you do?
- AGive the money to the official, it’s a small money anyway
- BGive the money to the official and charge it under lump sum component
- CStop work and notify this immediately to BP
- DDecline the request and replace it with a gift parcel
- 2A customs official tells you that it could take some time to process the customs clearing paperwork, but then mentions to you in the next sentence for no apparent reason that he is having difficulties paying his son’s school fees. Does this create an issue for you? What should you do?
- AFollow the BP Code of Conduct
- BEscalate your concerns to BP at the earliest opportunity
- CPay some fees to smooth the customs process
- DNo need to take any actions
- 3Related with BP’s contract, your company is required to host government official for an approval. You will act on behalf of BP to pay logistics, accommodation and per diem (if any). However the contract does not specify this type of expenses. What you need to do?
- AGo ahead with the event and put the expenses under lump sum/ reimbursable item
- BInform and request prior approval from BP’s contract owner. The contract owner then will proceed with internal Government Hosting Registration
- CYou know the process will be complicated in BP. Therefore, you prefer to pay expenses directly using your company pocket.
- DNo need to take any actions
- 4You have been treated disrespectfully by your BP contract owner. You know it’s your right to speak up this matter. Below is the proper channel to communicate your concern, except?
- AExit from the contract
- BDrop an email to PSCM specialist
- CGet in line with BP Ethics & Compliance
- DCall open talk
Not Right
BP has zero tolerance on facilitation payment. Facilitation payment is considered an illegal bribe under the UK Bribery Act 2010. It is an offence to the regulation to pay the facilitation payment.
Not Right
BP has zero tolerance on facilitation payment. Facilitation payment is considered a bribe under the UK Bribery Act 2010. It is an oence to the regulation to pay the facilitation payment. BP can be made liable if its third parties pay the facilitation payment on its behalf.
Right
You must speak when facing hindrances in performing your tasks for BP in regards to bribery and corruption acts.
Not Right
BP has zero tolerance on facilitation payment. Facilitation payment is considered an illegal bribe under the UK Bribery Act 2010. It is an offence to the regulation to pay the facilitation payment.
Not Right
Not quite right. Following the Code by not soliciting bribes is correct. However you will need to do more than this.
Right
You should escalate any concerns or bribes. You must inform BP about the possibilities of time delays and refrain from paying the bribes.
Not Right
You should escalate any concerns or bribes. BP do not tolerate bribery and corruption in any of its forms in our business. BP comply with anti-bribery and corruption laws and regulations and support eorts to eliminate bribery and corruption worldwide. We work to make sure that our business partners share our commitments.
Not Right
Not taking anything is already an action. You should escalate any concerns or bribes. BP do not tolerate bribery and corruption in any of its forms in our business. BP comply with anti-bribery and corruption laws and regulations and support eorts to eliminate bribery and corruption worldwide. We work to make sure that our business partners share our commitments.
Not Right
Any events or activities that require government officials presence and provisions or logistics are provided, must be consulted with BP. This should be registered as a government hosting proposal and a pre-approval from Legal is required. Furthermore, BP requires its third parties to keep accurate transactions which are subject for audits.
Right
Any events or activities that require government officials presence and provisions or logistics are provided, must be consulted with BP. This should be registered as a government hosting proposal and a pre-approval from Legal is required.
Not Right
Your contract with BP states that you must adhere with the Code of Conduct and the provision of the ABC clause. Any events or activities that require government officials presence and provisions or logistics are provided, must be consulted with BP. This should be registered as a government hosting proposal and a pre-approval from Legal is required. Furthermore, BP requires its third parties to keep accurate transactions which are subject for audits.
Not Right
Not taking anything is already an action. Your contract with BP states that you must adhere with the Code of Conduct and the provision of the ABC clause. Any events or activities that require government officials presence and provisions or logistics are provided, must be consulted with BP. This should be registered as a government hosting proposal and a pre-approval from Legal is required.
Right
Walking out from the contract showing that you do not follow the BP’s Code and the agreement. You will need to Speak Up when you encounter behaviours which are not in line with BP Code of Conduct.
Not Right
You will need to Speak Up using one of BP’s Speak Channel when you encounter behaviours which are not in line with BP Code of Conduct.
Not Right
You will need to Speak Up using one of BP’s Speak Channel when you encounter behaviours which are not in line with BP Code of Conduct.
Not Right
You will need to Speak Up using one of BP’s Speak Channel when you encounter behaviours which are not in line with BP Code of Conduct.
