Sofrecom’s involvement makes the vulnerable areas more reliable and strengthens the efficiency of the corresponding processes!
A major transformation in business management is currently taking place on a global scale. Public aversion to corrupt companies is an entirely new dimension with immediate commercial consequences. In addition to these consequences, which are sometimes irrationally multiplied by social networks, the legal repercussions are even more penalizing for companies. These ethical constraints suddenly imposed on companies are also an opportunity to be seized…
Compliance rules are now extra-territorial
ZTE, a company that has experienced sanctions, is a perfect illustration of the importance taken by the “compliance” area and in particular, by the requirement to comply with international anti-fraud and anti-corruption rules.
The ZTE case, like many previous ones, reveals another major transformation: the extraterritoriality of the practice of law. And even if European or other law benefits from this gradual disappearance of borders, it has to be admitted that American jurisdiction has imposed itself de facto on the whole planet.
It doesn’t matter whether it’s because of transaction currency (in this case, the dollar) or because the U.S. is the world’s largest economy. The fact is that companies that find themselves at odds with U.S. law comply with its demands without further litigation. Resisting a technological embargo, trade or territorial restrictions, or even fines imposed by the U.S. State itself is simply not possible.
In addition, many countries have introduced legislation that makes it mandatory to implement an anti-corruption program in companies, including in their subsidiaries abroad. This is the case in France, with the Sapin law, in England, with the Bribery Act, etc.
What means do companies have to avoid being in breach?
It is in the implementation of an Internal Control system that the solution lies for a company to control its fraud and corruption risks, and thus avoid opposing American legal power or the legislation of its country.
Governance, Internal Control-Management of risks and Internal Audit rules have been initiated in the U.S. Everyone knows about the Sarbanes Oxley Act, which is a model of its kind, and most countries have taken inspiration from it. Behind this law is the international governance standard, COSO, which is recommended by the entire global Internal Audit profession, under the aegis of the IIA, the American Institute of Internal Auditors.
Many companies have implemented a program to combat fraud and corruption, such as the Orange group, and Sofrecom, which is the first subsidiary to have received Ethic Intelligence certification. These programs are variations of the COSO requirements in the very specific field of fraud and corruption.
The fight against corruption: a twofold operational benefit
A legal necessity for companies
Fraud and corruption are risks that can undermine a company’s profit and profitability. All business involves taking risks: strategic, human, financial, technological, legal, etc. The risks associated with fraud and corruption are not, therefore, the only ones. But they should be classified in the major risks category because they expose companies to considerable consequences, both in terms of image and in legal terms and therefore, financially. A company that does not take these risks into account can put its business, and in some cases, its existence, at risk. It will have American law and that of many countries against it.
One way of improving the efficiency of all activities
Fraud and corruption interfere with the normal performance of the company’s activities. Whether in terms of purchases, negotiations with suppliers, stock management, recruitment, work on technical sites, payroll, cash register management, etc., the sources of loss of income undermine the very efficiency of the company in proportions that can be very significant. In the telecommunications sector, for example, the studies carried out on the subject sometimes amount to more than 20% of possible losses if only on the network.
“Any activity that is not controlled deteriorates”, stated Jacques Renard, head of Internal Audit in France. Whatever the field, it is enough for a process or procedure to contain a flaw, a lack of preventive control, for there to be the possibility of ill-intentioned persons or entities deviating all or part of the company’s activity or assets without its knowledge, and profiting from them.
It is no coincidence that all the entities and subsidiaries that Sofrecom has supported to implement an anti-corruption program have expressed their satisfaction with this business aspect. Sofrecom’s involvement makes the vulnerable areas more reliable and strengthens the efficiency of the corresponding processes! Implementing a system against fraud and corruption is therefore not only a legal obligation. It’s also an opportunity.
Thus, the new anti-corruption rules are not only perfectly compatible with the business, they are also entirely beneficial to it.