Workshop: Risky Business; Working with Agents, Contractors and Other Third Parties

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It used to be companies were fairly comfortable with the idea that risk ended at the factory door. Outsource a solution, and it was less likely to tarnish the company’s reputation or lead to fines and other penalties.

Not so today. And, in the area of anti-corruption, blaming a bribe on a third party – a vendor, supplier, agent, or contractor — is no defence, as company after company has discovered.

Avoiding third party risk all together may sound attractive, but for many businesses that is just not possible. The question is: how do you work with third parties in as prudent a way as is possible?

This workshop will attempt to answer that question by outlining and discussing the key steps to manage third party risk:

• Selecting Third Parties
Understanding when it is appropriate to use a third party and the risks involved
• Due Diligence
It’s essential that a rigorous due diligence process is put in place to ensure that the company is what it truly claims to be. Are the owners related to government officials? Do they have a track record working with other multi-nationals? What is their reputation in the market both in terms of what they can do but also how they do it?
• Enhanced Due Diligence and Open Source Intelligence (OSINT)
   Using news and media in anti-corruption compliance
   Media tracking of negative issues
• Code of Conduct & Third Parties
Should you extend your code of conduct to your third party? If so, how will you monitor their adherence to it?
• Writing a Contract that Reflects Risks
Given the risks of corruption many believe it is essential that you have the right to terminate the agreement promptly and to audit the third party’s books and records.
• Extending Your Reporting Mechanisms
Should you let your agent and contractor’s employees access your helpline? Is it even lawful to do so where you operate.
• Auditing & Monitoring
Due diligence can’t end with signing the contract. To protect against corruption auditing and monitoring must be constant and built into the relationship.
• Screening technology and Anti-Corruption compliance
   What, how and when to screen
   Implementing a Risk-Based Approach
   Managing the operational impacts of anti-corruption screening
   Maintaining screening and reporting strategies
• M&A Activity
You’ve just acquired a company. Have you taken steps to ensure that their third parties were properly vetted and audited?
• Joint Ventures
Many believe that “the JV has the anti-corruption program handled.” How do you know that? The risk may be still be yours.
• Competitive advantage of implementing and enforcing a corporate anti-corruption framework (versus disadvantages of doing nothing or not doing enough)

Moderator: Adam Turteltaub, The Society of Corporate Compliance and Ethics
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Rapporteur: Magalie Pimentel, Dow Jones & Company

Panelists:

Kathleen Edmond, Best Buy
Alex Bakhshov, Hugh Fraser International, and Formerly Vetco International
Katharine Bostick, Microsoft
Rupert de Ruig, Dow Jones & Company

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