Best Practices

Compliance and Ethics Program

BY: Pancho Adelberto Hubilla • Jun 26, 2017

Ethics or simple honesty is the building blocks upon which our whole society is based, and business is a part of our society, and it’s integral to the practice of being able to conduct business, that you have a set of honest standards.” – Kerry Stokes

The Corporate’s interest to the compliance and ethics program by companies was brought about by coffee talk with Ms. Lizza Vicaldo, the Country Director of the Compliance and Ethics Committee of a multinational cement firm in the country. The interaction centered on Ms Vicaldo’s enthusiasm relative to the inherent corporate culture that will be ushered in by her company’s establishment of the Compliance and Ethics Committee. She believes that her company’s core values of Respect, Integrity, Growth and Innovation, Health and Safety, and Teamwork will be engrained and continually nurtured through the compliance and ethics program.

Relatively, readily available references indicated that the compliance and ethics programs by American companies were brought about by violation of US laws in third country business transactions. This violation of American Laws resulted to the US government’s crafting of correlated laws to ensure strict adherence by American business entities to the legal mandates. The forerunner of these correlated laws is the Foreign Corrupt Practices Act (FCPA). However, the American Government realized that the American business entities were disadvantaged by the legal prohibitions of FCPA because their foreign business counterparts are bribing and performing other acts specifically prohibited by FCPA on American business entities. This moved the US Government to negotiate with a 34-member nation coalition referred to as Organization for Economic Co-operation and Development (OECD) to enact legislation similar to FCPA. OECD subsequently signed the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions.

Cursory look up indicated that most of the western multinational business entities operating in the country have their respective compliance and ethics programs. This is because of the OECD Convention. The most common attributes of these compliance and ethics programs are the affirmation of commitment to integrity, respect (for the inherent universal human rights), safety, and avoidance of conflict of interest. The differences were in the respective unique objectives of the different business entities.

The common aspirations and attainments of the read business conduct and ethics codes are the creation of their respective business culture of trust, accountability, productivity, and integrity.

Indeed, The Corporate cannot help but share with Ms. Vicaldo’s enthusiasm regarding the creation of Compliance and Ethics Program in her company. It is truly remarkable when an individual’s pursuit of material gain could be intertwined with (we’ve removed our) moral aspirations through the ethical standard in the workplace.

There are two primary factors that effectively immersed ethical codes to a business entity and its human resource. The first is an external rule that directs the business entity to pursue an ethical code through clearly defined legal latitudes. The second is the business entity’s resolve to govern its economic pursuit through an inherent ethical culture.

Practical realities in a local environment where there may be weak rules and statutes that uphold ethical standards may beset a business entity that is governed by ethical code. Its opportunities may be challenged. However, business entities have always had the force of collective call to uphold their respective ethical codes. The OECD Convention manifests this collective call.

The institutionalization of the compliance and ethics program will support the ‘pronounced clean governance and government’ by the new Philippine leadership. It will be more effective if the government streamlines its existing statutes and rules to create compelling latitude for the Philippine business entities’ compliance and ethics program. After all, ethics is universal in nature and by need.

Spread the love

Leave a Reply

Your email address will not be published. Required fields are marked *