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12.11.2016Anti-Corruption Compliance to Become a Competitive Advantage for Companies in Ukraine

The first international conference in Ukraine on fighting corruption in the private sector under the title ‘Anti-Corruption in Business: International Experience and Ukrainian Reality’ was held on November 11, 2016, in the city of Kyiv.

This event became a stepping stone to implementing the project of the Center for International Private Enterprise (CIPE) ‘Enhancing Anti-Corruption Compliance in Business’; the project started in 2015 and is being carried out in 2016 by Corporate Governance Professional Association (CGPA) with a view to helping Ukrainian business and government employees to ensure compliance with the requirements of Chapter X of the Law Ukraine «On Prevention of Corruption».

As explained by the organizer of the event, Oleksandr Okuniev, Chairman of the CGPA Board, it is the implementation of anti-corruption compliance standards and procedures in daily operations of enterprises that will help Ukrainian companies become highly competitive in the eyes of their international partners.

In particular, Oleksandr Okuniev declared that «By lending their support to this program, the American partners represented by CIPE strive to achieve significant minimization of corruption risks in Ukrainian business. Bear in mind that any violation by contractual parties outside the US carries reputation and financial losses of the US companies legally bound to their business parties. That is why CGPA, with the support of CIPE, continues to educate a new generation of Ukrainian compliance officers who shall ensure compliance with the anti-corruption rules, which in turn must increase the overall competitiveness of Ukrainian business on foreign markets».

The conference became a common discussion platform for leading experts on implementation of the anti-corruption rules in state-owned and private companies. The topics included a discussion of legal aspects of enforcing regulation in this field, and the Ukrainian and foreign experience of implementing some parts of the compliance program. The event was sponsored by the Corporate Governance Professional Association (CGPA) with the support of the Center for International Private Enterprise (CIPE).

Oleksandr Skopych, a member of the National Agency for the Prevention of Corruption (NAPC), and leading experts in the field had a discussion over some aspects of enforcing state regulation in the fight against corruption in Ukrainian and foreign business. The discussion took place at the first session of the conference moderated by President of the American Chamber of Commerce in Ukraine (ACC) Andy Hunder.

In the words of Oleksandr Skopych, a member of NAPC, «the main function of our Agency is to prevent, and not to punish or suppress. Our realistic task is to minimize corruption risks. Our plans for the next year include further revision of the electronic declarations registry, provision of free access to a bunch of databases of government offices, synchronization and automation of this procedure, and finalization of the anti-corruption legislature».

Drago Kos, Chair of the OECD working group on bribery in international business transactions, presented his overview of the situation in Ukraine as seen by the international business community. Although he noted some positive changes that had taken place in the country in the past two years, he pointed out that there are still many things that remain to be improved and adapted.

«Speaking of the sheer number of institutions dealing with the eradication of corruption, Ukraine has broken all records; in this area, it has overtaken even Montenegro. Despite all the efforts spent, the country’s business transparency ratings indicate its low position, which is a definite sign that something keeps going wrong. We watch closely as NAPC tries to launch its projects, hoping that we will be able to discuss the tangible results achieved by the Agency as soon as the next year», said Drago Kos.

At the second session, the speakers discussed effective international standards of anti-corruption compliance in business. Olha Vorozhbyt, Head of Dispute Resolution Practice, DLA Piper Company, talked about the British Law on Prevention of Corruption. Maryana Marchuk, Adviser, Baker & McKenzie presented her views on the Law on the Foreign Corrupt Practices (FCPA). Olivia Allison, Director of Forensic Department, KPMG, elaborated on real-life investigative cases of violations of corruption laws and gave some practical advice to Ukrainian companies.

Anna Kompanek, director of interregional CIPE programs, Washington, was moderator of the second session. She described the basic principles of ISO 37001 standard project that ensures standardization of the anti-corruption actions in companies; to the session participants, she also pointed out the benefits and limitations of this draft document.

As stated by a CIPE expert, the ISO 37001 standard can be an efficient tool for prevention of bribery very much required today by specialists in the field. According to Anna Kompanek, it will take some time to deliver tangible results since it is necessary to complete translation of all documents, coordinate relevant efforts with national authorities, and work with the current Ukrainian market.

The topic of the third and fourth session of the conference was Ukrainian experience in developing and implementing the anti-corruption programs by Ukraine’s companies. The audience took a keen interest to this topic. The best domestic practices were presented by Oleksiy Povolotskyi, Head of the Department for Corporate Governance, Corporate Secretary of the DTEK Group Holding Company; Yuri Voytsitskyi, DTEK Compliance Officer; Olha Shenk, Senior Lawyer, CMS Cameron McKenna Company; Tetiana Kyryk, Compliance Director, Kyivstar, PJSC; Bohdan Kruk, Corporate Secretary, Ideya Bank, PJSC; Taras Kyslyi, Head of Anti-corruption Compliance Practice, YEPAP Ukraine; Orest Stasiuk, Associate in Criminal Law, EPAP Ukraine; and Danylo Hloba, Deputy Director for Legal Issues, Youcontrol IT-Company.

CGPA has summed up the best international and domestic practices of implementing the anti-corruption tools in the private sector, and presents those at its five-day training program for coaching of persons authorized for implementation of the anti-corruption program (i.e., compliance officers). Until now, two sessions of the above program took place in Kyiv in the fall of 2016. Now the 2017 registration is open, experts are welcome to enroll.