confidential [ 1 ] - scce official site€¦ · scce compliance & ethics institute - october...

9/20/2012

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[ 1 ]CONFIDENTIAL

Complying with Global Anti-Corruption Laws:A Case Study

Complying with Global Anti-Corruption Laws:A Case Study

Susan Roberts Executive Vice President & Chief Compliance Officer

Bausch + Lomb Incorporated

SCCE Compliance & Ethics Institute - October 15, 2012

[ 2 ]Complying with Global Anti-Corruption Laws: A Case Study

We offer the world’s most comprehensive portfolio of eye health products and we have one of the oldest, best known and most respected healthcare brands in the world.

Our core businesses include soft and rigid gas permeable contact lenses, lens care products and ophthalmic surgical and pharmaceutical products.

The company began in 1853 in Rochester, New York, as a small optical shop that grew to become a multi-billion dollar global corporation with approximately 11,000 employees worldwide and with products available in more than 100 countries.

Bausch + Lomb:See better. Live Better.


How many of your companies do business outside the United States?

How many employees are there in your company?

How many of your companies are in a highly regulated industry?

Informal SurveyInformal Survey

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The Anti-Corruption Legislative and Enforcement Environment Continues to IntensifyThe Anti-Corruption Legislative and Enforcement Environment Continues to Intensify

Global companies need to ensure their anti-corruption programs are robust and effective.


Today’s GoalsToday’s Goals

Share our experience

How we assessed our risks

How we positioned compliance with anti-corruption laws as a competitive advantage

How we developed relevant, user friendly policies to get maximum compliance

How we partnered with our business leaders for maximum success

Essentially, we’ll share what we did and continue to do to ensure our anti-corruption program is robust and effective.


Our Compliance ApproachOur Compliance Approach

The Compliance Department’s Role is to Help the Businesses and Functions:

The Businesses and Functions “Own” Compliance in their respective areas.

Assess and Prioritize Legal and Compliance Risks

Evaluate Systems and Processes Do they appropriately mitigate the prioritized risks?

Build/Strengthen Systems and

Processes Provide Training and Awareness

Monitor/Audit Are the Systems and

Processes working as intended?

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Assess Your Corruption RisksAssess Your Corruption Risks

– Proactively identify and regularly update your risk assessment

– Know where you are most vulnerable:

• What types of interactions do your employees have with government officials?

• What’s the nature of your business?

• What industry are you in?

• How confident are you with your Tone at the Top?

• How confident are you with your internal controls?

• Do you do business with third parties?

• Where are your employees and third parties doing business?

It is critical to design your company’s overall anti-corruption program to mitigate your company’s greatest risks.



The TI Corruption Perceptions Index (“GPI”)



1. How employees interact with Government Officials;

2. How employees interact with Healthcare Professionals (HCPs) who can be considered Government Officials; and

3. Third parties and their interactions

Medical Device and Pharmaceutical Companies Have to be Concerned with:

Employees

Third Parties

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Our Experience: Mitigate the RisksOur Experience: Mitigate the Risks

Our Employees Third Parties


Ensure Employees’ ComplianceEnsure Employees’ Compliance

Our EmployeesThird Parties


Ensure Employees’ Compliance: Have Clearly Articulated, Relevant, User-Friendly PoliciesEnsure Employees’ Compliance: Have Clearly Articulated, Relevant, User-Friendly Policies

Europe, Middle East & Africa Region Asia Pacific Region North America, Latin America and Canada

Austria Middle East Australia/New Zealand Argentina

Balkans Netherlands China Brazil

Belgium Nordic Hong Kong Canada

Bulgaria Norway India Mexico

Czech Republic Poland Japan United States

Denmark Russia Korea

Finland Slovakia Malaysia

France South Africa Singapore

Germany Spain/Portugal Taiwan

Greece Sweden Thailand

Hungary Switzerland

Iceland Turkey

Italy Ukraine

North Africa United Kingdom

• Codes developed with businesses based on current law and industry codes• Development process itself was a key assessment and awareness initiative• In-Person Intensive Training: “Train the Trainer” approach• All Codes and training materials translated in applicable languages

Country Specific Sales and Marketing Codes

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Ensure Employees’ Compliance:Code Development and DesignEnsure Employees’ Compliance:Code Development and Design

Reviewed regional and country specific legal requirements

Reviewed regional and country specific industry codes

Worked with the Law Department to draft codes to address key sales and marketing activities – tailored to each country’s laws and industry codes.

Sent to outside legal counsel in each country for review.

Sent to business and country leaders for comment and had many conversations before finalizing them.


Ensure Employees’ ComplianceEnsure Employees’ Compliance

Show me, and I may remember.

Involve me, and I will understand.

Tell me, and I will forget.

Confucius


Ensure Employees’ Compliance:Code Development and Design Ensure Employees’ Compliance:Code Development and Design

Focus only on key subject areas;

Provide a clear and concise summary of country specific legal and industry requirements;

Set forth procedures that were not unnecessarily burdensome; and

Provide the maximum amount of commercial flexibility within the law.

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Ensure Employees’ Compliance: Have Clearly Articulated, Relevant, User-Friendly PoliciesEnsure Employees’ Compliance: Have Clearly Articulated, Relevant, User-Friendly Policies

Topics


Ensure Employees’ Compliance:TrainingEnsure Employees’ Compliance:Training

Tone at the Top critical

“Hand-selected” key regional and country leaders for a one to two day, in-person training session

“Train the Trainer” approach – each leader attending knew they’d be responsible to train their teams in person

Pre-Reading required


Ensure Employees’ Compliance:Training Session Learning ObjectivesEnsure Employees’ Compliance:Training Session Learning Objectives

1. Why developing and implementing effective sales and marketing codes of conduct was so important to our commercial success;

2. What the new sales and marketing codes require us to do;

3. How they would teach their colleagues about the new sales and marketing codes and develop effective controls; and

4. When the new sales and marketing codes and controls were required to be implemented.

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A Case Study: Country Specific Sales and Marketing Codes 19



2. What the Sales & Marketing Codes Required:

Before the “What” comes the “Why”

Why do the governments around the world have all these rules?

“People will do almost any what if you give them a good why.”Nietzsche


Ensure government officials act in the best interests of people rather than themselves;

Ensure HCPs make medical judgments based upon what’s best for the patient rather than what’s best for themselves; and

Ensure that public healthcare programs and institutions pay a fair price for medical devices and drugs.

Ensure Employees’ Compliance: The “Why”Ensure Employees’ Compliance: The “Why”

Governments’ Objectives in Regulating the Healthcare Industry’s Interactions with HCPs

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Ensure Employees’ Compliance:Training Session Learning Objectives Ensure Employees’ Compliance:Training Session Learning Objectives

Before the “What” comes the “Why”

Detailed Code Review – Enlisted Selected Country Leaders to “Teach” a Topic

Scenario Analysis Workshop – Business Unit Breakout Sessions

Plenary Discussion and Team Scenario Reports

“Open Book” Knowledge Challenge and Review with Voting Devices

2. What the Sales & Marketing Codes Require



3. How they would teach their colleagues about the new sales and marketing codes and develop effective controls; and– Training Materials

4. When the new sales and marketing codes and controls were required to be implemented.– Implementation Schedule

– Certification Process

– Team Implementation Discussions and Agreed Upon Next Steps


Ensure Employees’ Compliance: Process FeedbackEnsure Employees’ Compliance: Process Feedback

“I would like to congratulate you and your team for the world class sales & marketing code of conduct program that you have finalized. I can benchmark with what has been done on the same subject, very key to the business and I can just say: Bravo!”

“It is clearly one of the best training sessions I have ever attended. Very strong preparation, very clear explanations, very strong and proactive support.”

“Well done… outstanding job! Huge work of preparation and above all ability of the team to present and liven up pretty serious stuff with fun and a lot of energy. Thank you also for having listen to the specificities and providing a pragmatic answer.”

“The two days were organized and delivered with style, professionalism and humor and I am confident that the next stage to cascade to the wider teams will be successful.”

“It was such a great week, thank you sincerely for all the work you all put into delivering a world class training. Looking forward to rolling the codes out – and many thanks for your continued support.”

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Ensure Employees’ Compliance:Challenges Moving ForwardEnsure Employees’ Compliance:Challenges Moving Forward

Monitoring/Auditing

Ongoing Training – New employees and refresher training

Keeping on top of changes in law and industry codes

– Internet searches and monitor websites

– Annual check – outside counsel

– Our leaders in country


Our Experience: Mitigate RisksOur Experience: Mitigate Risks



Third Party Risk Management:Global Distributor Assurance ProgramThird Party Risk Management:Global Distributor Assurance Program

Objective: Develop more consistent, systematic processes to better mitigate our risks with Distributors

Risks associated with Distributors:

Financial; International Trade Laws; Regulatory License and Registration Laws; Quality Assurance; and Anti-Corruption

• Can the Distributor effectively provide the required market access or otherwise satisfy our commercial needs?

• Is the Distributor a good credit risk?• Can the Distributor properly handle our products with appropriate

temperature, humidity, sanitary, pest and security controls?• Does the Distributor have the appropriate regulatory licenses to handle our

products?• Does the Distributor conduct its business in compliance with the law and

applicable industry ethics standards?

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Two aspects to the Program:

1. Current Portfolio – Evaluate and manage the risks associated with our current portfolio of Distributors

2. Process Going Forward – Ensure a more consistent process going forward for new distributors or renewal of distributors



Took an inventory of Distributors by Country

Contracted with Steele International to provide an initial assessment of risk on our current portfolio

Identified high risk Distributors using various criteria

Steele conducted enhanced due diligence on high risk Distributors using Online research of 320+ government enforcement and regulatory agencies and sanction and

embargo lists Intense media research of local and mainstream media sources Analyzed data to determine the existence of “red flags”

Red Flags Identified were addressed with businesses

Current Portfolio



Next Steps

Sent list back to Businesses/Country Managers for review

Is the list accurate? Is it complete?

Do you agree with risk level assigned?

Do you have contracts/agreements with your Distributors? Have you seen them?

If so, when will the contracts/agreements renew or expire?

Has any due diligence of your Distributors taken place?

What documentation do you have to demonstrate the due diligence?

Identify Action Steps Necessary for you to be comfortable and assure senior management and your colleagues that you are effectively managing the risks presented

Certification from Businesses/Country Managers

Current Portfolio

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For all new Distributors and renewed Distributors Background checks (Basic, Enhanced)

Due Diligence Questionnaires

Review in system by Finance, Legal, Regulatory, Commercial

Standard Form Distributor Agreements

All documentation stored electronically

Other tools: Questions to ask Distributors during course of Agreement; On site visit checklists; Distributor Annual Compliance Certifications

Distributor Training Materials

Distributor Assurance Program “Toolkit” – Global SOP and Electronic System

Process Going Forward



The Process provides better assurance that we know and are comfortable with our Distributors around the world.


The program was put in place to mitigate legal and compliance risks but business leaders

recognized the value it provided them from a business perspective...


A Compliance Tool and A Business Management Tool

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Our Experience: Mitigate RisksOur Experience: Mitigate Risks



Compliance Programs Really Do CountCompliance Programs Really Do Count


Thoughts and Recommendations for Building a Robust Anti-Corruption ProgramThoughts and Recommendations for Building a Robust Anti-Corruption Program

Embed compliance in the business – the business must recognize itowns the risk

Then, together with the business:– Start with a risk assessment

– Prioritize your risks

– Evaluate your current systems and processes for mitigating your risks

– Determine if you need to strengthen or build systems and processes

And work together to do so –

Recognize that if you want to significantly mitigate your risk, you have to invest significant time and resources

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Thoughts and Recommendations for Building a Robust Anti-Corruption ProgramThoughts and Recommendations for Building a Robust Anti-Corruption Program

Put yourself in the shoes of your business leaders, of your employees

Provide clearly articulated, relevant, user friendly policies and easy to use tools to make it easier for the business to manage their compliance risks

Stay on top of the ever changing laws

Provide engaging, relevant training and don’t forget the “why”

You must monitor and audit to see if the systems and processes you put in place are working as intended to mitigate the risks

Continue to assess your risks – periodically, and as your business changes, as the laws change

Be as flexible and pragmatic as you can and be a good business partner – collaboration is key


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Collaboration – Webster’s DefinitionCollaboration – Webster’s Definition

“1 Collaboration is the act of working together to produce a piece of work.

2 A collaboration is a piece of work that has been produced as the result of people or groups working together.

3 Collaboration is the act of helping an enemy who is occupying your country during a war. ”


Resources for you to consider:Resources for you to consider:

Bribery and Corruption

Navigating the Global Risks

Brian P. Loughman; Richard A. Sibery, Ernst & Young, LLP

The Foreign Corrupt Practices Act Handbook

Robert W. Tarun

Corporate Executive Board’s International Anti-Corruption Checklist

Miscellaneous Articles by Law Firms and Accounting Firms (the Internet is a wonderful resource!)

Linked In Compliance and FCPA Corporate Compliance Exchange Discussion Boards

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Thank you!

confidential [ 1 ] - scce official site€¦ · scce compliance & ethics institute - october...

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