UL Responsible Sourcing wishes to thank its clients and industry friends for a successful 2017! We were delighted to see you at our summits in Los Angeles, London, Barcelona, Milan and Frankfurt. Together, we explored the topics of the Unintended Costs of Regional Responsible Sourcing Issues, Success Stories from Responsible Sourcing Initiatives, Traceability, Supply Chain Risk, the 3R’s, Optimizing Social Audits, Detox and Chemical Management, Conflict Minerals, and managing Anti-Bribery Controls. It was great to hear the thoughts of UL’s Ethics and Compliance Manager, Hasrul Rahman about managing Anti-Bribery controls in the interview below.
UL Responsible Sourcing: Hasrul, you’re UL’s Ethics and Compliance Manager. How did you get into this role?
Hasrul Rahman: I’ve been in this role since 2012, managing UL’s Ethics and Compliance programme in Asia and conducting ethics investigations. Prior to UL, I was a Senior Police Officer, at Assistant Superintendent rank, in the Singapore Police Force. I served for more than 17 years in a variety of police functions from General Policing to managing a team of 170, and Operational Planning, etc, and studied Criminal Law and Court proceedings during this time. My favourite task in the Police Force was being part of the Anti-Drug and Foreign Offenders Squad investigations team. This law enforcement experience gave me a unique perspective on criminality, legal proceedings, and formal evidence gathering, which now helps me lead UL investigations to identify what is factual and what is rumor. UL wants to ensure that everyone involved in an allegation, both the reporters and the implicated persons, are given a fair opportunity and a due diligence process. We need to establish whether ethical business conduct has been assured.
UL Responsible Sourcing: What does UL’s Ethics & Compliance Office do?
Hasrul Rahman: The Ethics & Compliance Office provides training and advice to UL’s employees about working with integrity. The Office is also responsible for investigating any allegations or claims of misconduct or corruption.
UL Responsible Sourcing: You talk about “ethical business conduct”. How does poor ethical conduct affect a business?
Hasrul Rahman: UL’s Ethics & Compliance Office’s trainings and workshops always revolved around a central message: conducting business in an ethical manner, in accordance with UL’s core value of Integrity. What exactly does this mean? Business Ethics concerns an individual’s judgement of a situation, separating right from wrong during decision-making, regardless of the business and operational pressures and influences. I call this the heartbeat of the organization. This may mean rejecting the easy route which could lead to short term profit, if we know that the route is ethically questionable. The importance of an ethical business conduct is increasing. Companies and organisations can be penalised for unethical conduct of a few individuals, and the loss of reputation and trust far outweighs the punitive financial loss suffered. To quote Benjamin Franklin, a renowned polymath, author, politician and the Founding Father of the United States of America, “It takes many good things to build a good reputation and only one bad one to lose it.” Establishing and maintaining strong ethical business conduct is paramount: working with integrity, in an ethical and responsible manner gives business partners peace of mind.
UL Responsible Sourcing: What kind of pressures can an auditor face when they are trying to execute their job? We know some of our clients like to nominate auditors they rate as highly-qualified, so why would UL choose to rotate auditors?
Hasrul Rahman: Our auditors operate in an environment where corruption could be viewed as a ‘way of life’ rather than a ‘fact of life’. What’s the difference? When we view corruption as a ‘way of life’, we tend to accept that it exists and at times embraces it as a norm. However, in contrast, when society views corruption as a ‘fact of life’ we acknowledge that it exists but do not condone this behaviour. We have seen cases where auditors were offered bribes, or threatened, to influence the outcome of an audit or inspection. Auditors have also been accused of giving false results because the factory refused to accede to their request for bribes. In rare occasions, some auditors have been unlawfully confined on factory premises until they comply with the factory threat to falsely amend the audit report. Thankfully, the latter is less common. We deliberately adopted a policy of rotating our auditors to minimise the risk of familiarity between the auditors and the auditees, so as to ensure a professional distance and impartiality. A positive outcome of this practice is that we also enhance the operational competencies of the auditors, through a varied experience.
UL Responsible Sourcing: How does the UL team go about investigating an allegation of bribery?
Hasrul Rahman: I mentioned earlier that we adopt a standard of high integrity when conducting any investigation. Investigation processes must be robust, fair, and thorough. Any investigation begins with identifying the source of the allegation: who made the report, when did the incident occur, where did it happen, and who were the parties involved. But sometimes sources need to remain anonymous to a certain degree, and we protect the confidentiality of our sources. We follow prescribed steps to objectively investigate allegations and to ensure fairness. We gather the evidence surrounding the allegation, through reviews of records, documents, physical objects, and interviews. Investigators look at evidence with impartiality, based on facts, and draw conclusions in a manner that supports that system as well as the interests of justice and accountability.
UL Responsible Sourcing: You mentioned in your presentation that anonymity is guaranteed. Why is this important?
Hasrul Rahman: UL emphasises the importance of anonymity and non-retaliation, as articulated in our Standards of Business Conduct. We create an environment where a person who comes forward to report an allegation or concern may do so without fear of any retaliation. However the privilege of anonymity only extends insofar that it does not have an adverse effect on the quality of the investigation. We guarantee the anonymity of the person making the allegations against the person alleged of an inconsistency. Anonymity by investigation participants will be honoured to the extent possible within the legitimate needs of the investigation.
UL Responsible Sourcing: How does the UL Ethics & Compliance Office work with UL’s customers?
Hasrul Rahman: While the Ethics & Compliance Office primarily faces inward to UL, we interact with customers both directly when investigating allegations of misconduct and through UL’s Responsible Sourcing team, by reporting any improprieties or issues related to our customer’s business on a regular basis.
UL Responsible Sourcing: What advice would you have for a brand/retailer setting up their anti-bribery and corruption policy for the first time? What steps do they need to take?
Hasrul Rahman: It is important from the onset before addressing the key elements of an anti-bribery policy to have senior management’s commitment to ethical conduct. Without clear and visible commitment, the policy risks being relegated to mere words with poor application. Another important step for setting up an anti-bribery and corruption policy would be to identify the relevant laws in the location of your company headquarters, countries in which your company operates, and the locations of jurisdiction of foreign anti-bribery laws applicable to your company. Once a policy has been adopted, the next step would be communication and training. Regular and systematic communication of your policy signals to the employees that the company has a zero tolerance policy towards bribery: this in turn ensure compliance. Employees should receive regular and specific in-person training to ensure meaningful implementation. The training should also be part of the onboarding process for all new employees. Regular monitoring will also demonstrate your company’s commitment to the policy, and evaluate its effectiveness. Of course, any bribery allegations must be promptly and properly investigated. Finally, Bribery risk assessments should be conducted regularly to help detect bribery hotspots in business transactions though risk analysis.
Hasrul A Rahman is the UL Ethics & Compliance Manager. He is responsible for the Ethics & Compliance Programme in UL and conducts training and investigation globally. Prior to joining UL, Hasrul was an Assistant Superintendent of Police in the Singapore Police Force for 17 years, including Criminal Investigation. He received a B.S. (Honours) degree in Management and Police Studies from Singapore Institute of Management University.
The mission of UL’s Ethics & Compliance Office is to promote and maintain a values-driven corporate culture, ensuring that the principles of integrity, honesty, quality and fairness are integrated into our business practices on a consistent basis around the world.
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