corporate disclosure on busines integrity in asean · release of study on corporate disclosure on...
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1
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
2
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
4
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
6
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
9
Data collection
10
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
11
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%
Indonesia Malaysia Philippines Singapore Thailand
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
Com
panie
s
Disclosure of commitment to comply with laws
Fully satisfied Partially satisfied Not Satisfied
100%
85%
98% 98% 100%92% 97% 93% 92% 97%
96%
94%
Indonesia Malaysia Philippines Singapore Thailand
Level of
dis
clo
sure
Average level of disclosure for commitment to comply with laws
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Disclosure of leadership support
Fully satisfied Partially satisfied Not Satisfied
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
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Disclosure for code of conduct applied to all employees and directors
Fully satisfied Partially satisfied Not Satisfied
76% 75% 80%
53%
91%91%96%
87%
56%
97%
75%
85%
Indonesia Malaysia Philippines Singapore ThailandLevel of
dis
clo
sure
Average level of disclosure for code of conduct applied to all employees and directors
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Disclosure of training programme for all employees and directors
Fully satisfied Partially satisfied Not Satisfied
30%
60%
46%
33%
55%50%
60%
70%67%
82%
45%
66%
Indonesia Malaysia Philippines Singapore ThailandLevel of
dis
clo
sure
Average level of disclosure for training programme for all employees and directors
2016 2018 Average for 2016 Average for 2018
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?
19
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Disclosure of code applied to agents
Fully satisfied Partially satisfied Not Satisfied
12%16% 10% 16% 16%
9%
20%17% 17% 19%
14%
16%
Indonesia Malaysia Philippines Singapore Thailand
Level of
dis
clo
sure
Average level of disclosure for code applied to agents
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Disclosure of code applied to suppliers
Fully satisfied Partially satisfied Not Satisfied
11%
17% 19%
27%
20%20%
28%
23%
38% 37%
19%
29%
Indonesia Malaysia Philippines Singapore Thailand
Level of
dis
clo
sure
Average level of disclosure for code applied to suppliers
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Fully satisfied Partially satisfied Not Satisfied
Disclosure of gifts, hospitality and expenses
63%
39%
61%
50%
84%
57% 59%
53% 51%
82%
59%
60%
Indonesia Malaysia Philippines Singapore Thailand
Level of
dis
clo
sure
Average level of disclosure for gifts, hospitality and expenses
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Fully satisfied Partially satisfied Not Satisfied
Disclosure of prohibition facilitation payments
3%
21%
14%
39%
27%23%
31%35%
42%41%
21%
34%
Indonesia Malaysia Philippines Singapore ThailandLevel of
dis
clo
sure
Average level of disclosure for prohibition facilitation payments
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
contributions
Fully satisfied Partially satisfied Not Satisfied
42%
11% 12%
25%
67%
35%
27%21% 23%
50%
31%
Indonesia Malaysia Philippines Singapore Thailand
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?
25
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
Indonesia Malaysia Philippines Singapore Thailand
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%
Indonesia Malaysia Philippines Singapore ThailandLevel of
dis
clo
sure
Average level of disclosure for prohibition of retailiation for reporting
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Fully satisfied Partially satisfied Not Satisfied
Disclosure of confidential reporting channel
51%
60%50%
68%
52%
72%
66%
73%
88%
77%
56%
75%
Indonesia Malaysia Philippines Singapore Thailand
Level of
dis
clo
sure
Average level of disclosure for confidential reporting channel
2016 2018 Average for 2016 Average for 2018
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
Indonesia Malaysia Philippines Singapore Thailand
Num
ber
of
com
panie
s
Fully satisfied Partially satisfied Not Satisfied
Disclosure of regular programme monitoring
34%
15%
32% 31%
56%48%
25%
52%58% 60%
34%
49%
Indonesia Malaysia Philippines Singapore Thailand
Lev
el o
f d
isclo
su
re
Average level of disclosure for regular programme monitoring
2016 2018 Average for 2016 Average for 2018
Overall level of disclosure
29
39% 40%43%
47%
57%51% 53% 53% 55%
67%
45%
56%
Indonesia Malaysia Philippines Singapore Thailand
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
30
Companies with highest disclosure rates across ASEAN
31
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