Anti-corruption via internal controls

Fraud in companies is increasingly becoming a topic of concern, as it leads to loss of company value, while devaluing its assets and hindering its ability to meet its objectives. Among the requirements imposed by the principles of the United Nations Global Compact, companies have to fight corruption in every shape or form, including extortion and bribery.

In response to a loss of confidence, companies have stepped up internal control activities and internal audits together with the use of new tools for mitigating the impact of losses due to fraud and misappropriation of assets.

Even in the most robust companies, management is under pressure to deal very effectively with crisis situations.

Even in the most robust companies, in the current business conditions, management is under pressure to deal very effectively with crisis situations or other incidents that are difficult to anticipate and frequently undesired, as they can have adverse repercussions in any organization.

The article from which this abstract is drawn explains the Internal Control – Integrated Framework,* which provides an outline of what a good anti-corruption program should accomplish and how its success should be defined. The article also presents the three stages behind identifying and analyzing inherent business risk.

At present, many companies have compliance programs covering aspects of legal and reputational risk that could be leveraged for assessing corruption risk. In the same way, compliance programs encompass professionals and processes tasked with monitoring compliance activities and conducting internal investigations; efforts that could be used to supervise the anti-corruption program.

In addition, there are several opportunities for leveraging the resources that the company has at its command: for example, extending the code of conduct to include observance of anti-corruption practices, establishing a detailed internal policy, having qualified personnel and implementing zero-tolerance policies for those who commit such acts.

An understanding of the laws, regulations and compliance guidelines provides the starting point for designing and implementing an anti-corruption program that is efficient and tailored to the needs and nature of the company.

*  Published in 1992 by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and updated in 2013,, accessed March 2014.

The complete article was written by:

  • Ligia B. Parra
    Barráes Manager, Advisory Services Venezuela

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