corporate disclosure on busines integrity in asean · release of study on corporate disclosure on...

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Release of Study on Corporate

Disclosure on Business Integrity

in ASEAN by

Professor Lawrence LohDirector

Centre for Governance, Institutions and Organisations

NUS Business School

National University of Singapore

and

Mr Thomas Thomas, CEO, ASEAN CSR Network

Presentation by:

Professor Lawrence Loh

Research

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Supported by

Conducted by

▣ Background

▣ Methodology and limitations

▣ Findings for Top 50 companies per country

▣ Companies with highest disclosure rates

across ASEAN

3

Agenda

Background

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Transparency International (TI) studies

5

• TI is an organization which aims to stop corruption and promote

transparency, accountability and integrity at all levels and across all

sectors of society.

• In it’s study, Corruption Perceptions Index (CPI) 2017

• most ASEAN countries were ranked at the bottom half with the

exception of Singapore which was ranked 6th in CPI 2017.

• It indicated that severe cases of corruption may be ongoing in the

region.

Transparency International (TI) studies

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Corruption Perceptions Index (CPI)

2017

Most ASEAN countries were ranked at the bottom half, indicating severe cases of corruption may be ongoing in the region.

The average score of ASEAN countries was 42 which is less than half of the total score.

TI is an organization which aims to stop corruption and promote

transparency, accountability and integrity at all levels and across all

sectors of society

Methodology and

Limitations

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Data collection

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Largest 50 companies in the 5 ASEAN countries

(Indonesia, Malaysia, Philippines, Singapore and

Thailand) by market capitalisations.

13 questions from Transparency International’s

study “Transparency in Corporate Reporting”

Annual reports, sustainability reports, codes of conduct,

corporate governance reports and company websites

1 = Fully satisfied, 0.5 = Partly satisfied, 0 = Not satisfied

Absence of public disclosures representativeness of

results and language barrier

Company Selection

Questionnaire

Sources

Scoring

Limitations

Conceptual framework

Category 1 - Internal commitment

to anti-corruption

Category 2 - External commitment

to anti-corruption

Category 3 - Reporting and monitoring

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Findings for top 50 companies per country

12

Questions

I. Does the company have a publicly stated commitment to

anti-corruption?

II. Does the company publicly commit to be in compliance

with all relevant laws, including anti-corruption laws?

III. Does the company leadership demonstrate support for

anti-corruption?

IV. Does the company’s code of conduct/anti-corruption policy

explicitly apply to all employees and directors?

V. Does the company have in place an anti-corruption training

programme for its employees and directors?

13

Category 1Internal commitment to anti-corruption

14

2731

25

32

45

5

4

4

15

3

1815

21

3 2

0

10

20

30

40

50

Indonesia Malaysia Philippines Singapore Thailand

Num

ber

of

com

panie

s

Disclosure of publicly stated commitment to anti-corruption

Fully satisfied Partially satisfied Not Satisfied

Internal commitment to anti-corruption (I)Does the company have a publicly stated commitment to anti-corruption?

35%

43% 45%

75%72%

59%

66%

54%

79%

93%

54%

70%


Level of

dis

clo

sure

Average level of disclosure publicly stated commitment to anti-corruption

2016 2018 Average for 2016 Average for 2018

15

4348 46

4348

61

1 611 1 3 1 1

0

10

20

30

40

50


Num

ber

of

Com

panie

s

Disclosure of commitment to comply with laws


100%

85%

98% 98% 100%92% 97% 93% 92% 97%

96%

94%


Level of

dis

clo

sure

Average level of disclosure for commitment to comply with laws


Internal commitment to anti-corruption (II)Does the company publicly commit to be in compliance with all relevant laws,

including anti-corruption laws?

16

118

1114

30

19

3

76

6

20

39

32 30

14

0

10

20

30

40

50


Num

ber

of

com

panie

s

Disclosure of leadership support


8%

14%

7%

13%

47%41%

19%

29%

34%

66%

18%

38%

Indonesia Malaysia Philippines Singapore ThailandLevel of

dis

clo

sure

Average level of disclosure for leadership support


Internal commitment to anti-corruption (III)Does the company leadership demonstrate support for anti-corruption?

17

4246

38

15

47

74

11

26

31 1

9

0

10

20

30

40

50


Num

ber

of

com

panie

s

Disclosure for code of conduct applied to all employees and directors


76% 75% 80%

53%

91%91%96%

87%

56%

97%

75%

85%


dis

clo

sure

Average level of disclosure for code of conduct applied to all employees and directors


Internal commitment to anti-corruption (IV)Does the company's code of conduct/anti-corruption policy explicitly apply to

all employees and directors?

18

1518

2824

35

20

24

1419

1215

8 8 73

0

10

20

30

40

50


Num

ber

of

com

panie

s

Disclosure of training programme for all employees and directors


30%

60%

46%

33%

55%50%

60%

70%67%

82%

45%

66%


dis

clo

sure

Average level of disclosure for training programme for all employees and directors


Internal commitment to anti-corruption (V)Does the company have in place an anti-corruption training programme for

its employees and directors?

Questions

I. Does the company’s anti-corruption policy explicitly apply to

persons who are not employees but are authorised to act on

behalf of the company or represent it?

II. Does the company’s anti-corruption programme apply to

non-controlled persons or entities that provide goods or

services under contract?

III. Does the company have a policy on gifts, hospitality and

expenses?

IV. Is there a policy that explicitly prohibits facilitation payments?

V. Does the company have a policy on political contributions

that either prohibits such contributions or if it does not,

requires such contributions to be publicly disclosed?

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Category 2External commitment to anti-corruption

External commitment to anti-corruption (I)Does the company's anti-corruption policy explicitly apply to person who are

not employees but are authorised to act on behalf of the company or represent it?

20

3 1 2

9

1415 13 19

41

33 34 3531

0

10

20

30

40

50


Num

ber

of

com

panie

s

Disclosure of code applied to agents


12%16% 10% 16% 16%

9%

20%17% 17% 19%

14%

16%


Level of

dis

clo

sure

Average level of disclosure for code applied to agents


External commitment to anti-corruption (II)Does the company's anti-corruption programme apply to non-controlled persons

or entities that provide goods or services under contract?

21

2

93

117

16

1017

16 23

32 31 30

2320

0

10

20

30

40

50


Num

ber

of

com

panie

s

Disclosure of code applied to suppliers


11%

17% 19%

27%

20%20%

28%

23%

38% 37%

19%

29%


Level of

dis

clo

sure

Average level of disclosure for code applied to suppliers


External commitment to anti-corruption (III)Does the company have a policy on gifts, hospitality and expenses?

22

26

17

9

23

37

5 2535 5

819

8 6

22

5

0

10

20

30

40

50


Num

ber

of

com

panie

s


Disclosure of gifts, hospitality and expenses

63%

39%

61%

50%

84%

57% 59%

53% 51%

82%

59%

60%


Level of

dis

clo

sure

Average level of disclosure for gifts, hospitality and expenses


External commitment to anti-corruption (IV)Is there a policy that explicitly prohibits facilitation payments?

23

5

15

8

19

7

13

119

4 27

32 34

2327

16

0

10

20

30

40

50


Num

ber

of

com

panie

s


Disclosure of prohibition facilitation payments

3%

21%

14%

39%

27%23%

31%35%

42%41%

21%

34%


dis

clo

sure

Average level of disclosure for prohibition facilitation payments


External commitment to anti-corruption (V)Does the company have policy on political contributions or if it does not, requires

such contributions to be publicly disclosed?

24

1611 10 11

22

3

51 1

6

3134

39 38

22

0

10

20

30

40

50


Num

ber

of

com

panie

s

contributions


42%

11% 12%

25%

67%

35%

27%21% 23%

50%

31%


Level of

dis

clo

sure

Average level of disclosure for political contributions

2016 2018 Average for 2016 and 2018

Questions

I. Does the programme enable employees and others to raise

concerns and report violations(of the programme) without risk

of reprisal?

II. Does the company provide a channel through which employees

can report suspected breaches of anti-corruption policies, and

does the channel allow for confidential and/or anonymous

reporting?

III. Does the company carry out regular monitoring of its

anti-corruption programme to review the programme’s

suitability, adequacy and effectiveness, and implement

improvements as appropriate?

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Category 3Reporting and monitoring

Reporting and monitoring (I)Does the programme enable employees and others to raise concerns and report

violations (of programme) without risk of reprisal?

26

30

46 4438

34

20

4 612

16

0

10

20

30

40

50


Num

ber

of

com

panie

s

Disclosure of prohibition of retaliation for reporting

Fully satisfied Not Satisfied

40%

66%

78% 80%

54%

60%

92%88%

76%

68%

64%

77%


dis

clo

sure

Average level of disclosure for prohibition of retailiation for reporting


Reporting and monitoring (II)Does the company provide a channel through which employees can report

suspected breaches of anti-corruption policies and does the channel allow for confidential and/or anonymous reporting?

27

36

22

3642

38

22

1

4

1

14

6

13

4

11

0

10

20

30

40

50


Num

ber

of

com

panie

s


Disclosure of confidential reporting channel

51%

60%50%

68%

52%

72%

66%

73%

88%

77%

56%

75%


Level of

dis

clo

sure

Average level of disclosure for confidential reporting channel


Reporting and monitoring (III)Does the company carry out regular monitoring of its anti-corruption programme to

review the programme's suitability, adequacy and effectiveness, and implement improvements as appropriate?

28

95

811

23

30

15

3636 14

11

30

63

13

0

10

20

30

40

50


Num

ber

of

com

panie

s


Disclosure of regular programme monitoring

34%

15%

32% 31%

56%48%

25%

52%58% 60%

34%

49%


Lev

el o

f d

isclo

su

re

Average level of disclosure for regular programme monitoring


Overall level of disclosure

29

39% 40%43%

47%

57%51% 53% 53% 55%

67%

45%

56%


Lev

el o

f d

isclo

su

re

Overall level of disclosure per country (2016) Overall level of disclosure per country (2018)

Average level of disclosure across ASEAN (2016) Average level of disclosure across ASEAN (2018)

Companies with highest disclosure rates

across ASEAN

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Companies with highest disclosure rates across ASEAN

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Company Country

Advanced Info Service PCL Thailand

Delta Electronics (Thailand) PCL Thailand

Digi.Com BHD Malaysia

Golden Agri-Resources LTD Singapore

Sembcorp Industries LTD Singapore

SIA Engineering LTD Singapore

Singapore Airlines LTD Singapore

Singapore Telecommunications LTD Singapore

Total Access Communication PCL Thailand

Unilever Indonesia Tbk PT Indonesia

XL Axiata Tbk PT Indonesia

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