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Wednesday
Dec212011

With Compliance, More Isn't Always Better

Alexandra Wrage, left, is the founder and president of TRACE International, a non-profit anti-corruption organization.

TRACE (which stands for Transparent Agents and Contracting Entities) offers member companies access to an online anti-bribery program and the annual TRACE Forum in Washington, D.C., among many other resources.

Wrage started TRACE in 2001, during her tenure as senior counsel for Northrop Grumman.

She was kind enough to answer a few questions about her anti-corruption efforts:

Q: Why did you make the leap from in-house counsel to head of an anti-corruption organization?

A: I enjoyed my time in-house, but in the anti-bribery space cooperation across companies is important. If a company is being extorted by a government official, that official will often say that the company’s competitors are willing to pay. If companies are speaking to each other, this tactic fails. I was also horrified at the amounts of money companies were spending to reach the same results.

Q: What was the most hopeful development you noticed in 2011? The most disappointing development?

A: We watched far more companies begin to take compliance seriously in 2011. It was encouraging to see many start with nothing and finish the year with a credible, functioning anti-bribery program.

On the other hand, it has been disappointing to watch some companies equate “more” with “better.” We routinely hear compliance officers asking what more they can be doing.

At some point, especially in this economy, the question is going to have to be: where do we need to pay more attention…and where can we prudently pay less?

Q: Can a multinational with an effective anti-bribery compliance program continue to do business in countries with a culture of entrenched corruption? If so, how?

A: First, I resist the expression “culture of corruption.” No culture celebrates theft and the citizens of the countries with the highest levels of corruption suffer most. … I do believe it’s possible for a company to do business anywhere without paying bribes. The business will be slower and less profitable.

Companies should build in the additional time and budget it will take to get things done when a quick pay-off isn’t an option. They will also need to plan for greater compliance resources on the ground for training and more frequent audits.

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Benjamin Kessler is an editor and writer for Ethics 360. He can be contacted here.

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[Editor's note: This post is part of our series profiling global compliance leaders. Most appear on our sponsor Ethisphere’s annual list of the 100 Most Influential People in Business Ethics. Readers are also welcome to suggest others they'd like to see profiled in this series.]

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