Zachary Coseglia, Amanda Raad, and I were happy to sponsor and contribute to Transparency International UK’s latest report, Make It Count, which takes a detailed look at why and how every company ought to measure the effectiveness of its approach to anti-corruption, as a whole and in terms of each constituent element.
Anti-corruption laws and enforcement are expanding globally, with many key regulators imposing significant penalties and sanctions for non-compliance and scrutinising companies’ anti-bribery and anti-corruption (ABAC) programmes for function and effectiveness, rather than form.
At the same time, companies around the world are channelling ever-increasing sums and employee hours into their ABAC programmes (typically a framework of policies, procedures, systems and controls, robust risk assessment, training, monitoring, and auditing) and their wider efforts to engender a culture of integrity and ethical conduct. One would expect that all of this is leading to a commensurate decrease in misconduct and resources lost to bribery and corruption, but that is seldom the case. But why?
The answer can be summed up (rather crudely) in two words: data and behaviour. As the Report explains in more detail, most companies are not measuring the effectiveness of their ABAC programmes and initiatives in any useful way: they are not looking at the correct types of metrics and data, and even if they are, their analyses and interpretation of data are often encumbered or skewed by practicalities, ill-suited methodologies, or unconscious biases.
The inescapable ingredient in all ABAC programmes is human behaviour. A company’s investment in its policies, procedures, systems, controls, and compliance staff ultimately depends on the integrity and behaviours of its employees. Human behaviour is also at the very heart of bribery and corruption – companies do not pay bribes, people do. For this reason, an effective ABAC programme needs to affect individuals’ behaviour by driving, facilitating, and encouraging good ethical decisions and compliance.
Effectiveness testing is something we understand deeply and feel very strongly about at Ropes & Gray! We launched our R&G Insights Lab (the legal industry’s first-ever practice to focus on analytics and behavioral science) last year to help clients across all industries to do just this – to successfully harness and combine data analytics with behavioural science theories and apply them across all functions to bring about meaningful, holistic change and real effect. And we have just welcomed Dr. Caitlin Handron to the team, as our Senior Lab Consultant and resident Behavioural Scientist.
This Report is a valuable read for everyone – from senior leadership and compliance officers through to the investors and regulators who must hold them accountable – and it is a great step towards learning how to improve effectiveness measurement and ensure a real impact on bribery and corruption.
R&G Insights Lab, is the legal industry’s first-ever offering to focus on analytics and behavioural science. It is a global, integrated, and cross-industry advisory service that combines the dynamic legal team of Ropes & Gray across the globe with world-leading experts in analytics, behavioural science, and strategic consulting.
Transparency International is the world’s leading non-governmental anti-corruption organisation.
Companies need to get to the point where measuring effectiveness is predominantly focused on assessing whether the anti-corruption approach is achieving the desired behavioural change and impact, as is the case in other fields such as patient safety, aviation safety and construction safety.