Anti-Corruption Training for Microsoft Partners

Transcription

1 Anti-Corruption Training for Microsoft Partners 1

2 English Version Welcome Welcome Welcome to Anti-Corruption Training for Microsoft Partners. This course is designed to help partners comply with the Microsoft Anti-Corruption Policy for Microsoft Representatives and the anti-corruption laws that govern business around the world. Introduction Microsoft's Ethical Standards Microsoft is committed to ethical business practices and we expect our employees and the employees of our partners to conduct business with high ethical standards and in compliance with the law. Microsoft only does business with trustworthy and ethical partners. This course is designed to help partners comply with the Microsoft Anti-Corruption Policy for Microsoft Representatives and the anti-corruption laws that govern business around the world. Partners agree in their contracts with Microsoft to provide anti-corruption training to their employees. By completing this course, you help satisfy this training requirement. At Microsoft, our partners' success is our success. We value our partners and we win together by doing business ethically and honestly. This course is developed by Microsoft for partners who do not have their own anti-corruption training program. Corruption fosters poverty, disease, and crime. Corruption hinders economic and social development, and is bad for business. It distorts competition and hinders partners' ability to fairly participate in customer opportunities. 2

3 No Bribes Allowed While this course covers a number of topics, Microsoft's policy prohibiting corruption and bribes provides the foundation of this training. Microsoft prohibits corruption of government officials and the payment of bribes or kickbacks of any kind, whether in dealings with public officials or individuals in the private sector. Microsoft partners must never, under any circumstances, pay or offer to pay a bribe. Every partner agrees in its contract with Microsoft that the partner will not pay bribes: Company will comply with all applicable laws against bribery, corruption, inaccurate books & records, inadequate internal controls, and money-laundering, including the U.S. Foreign Corrupt Practices Act ("Anti-Corruption Laws"). All partners certify that they will comply with the Anti-Corruption Policy for Microsoft Representatives: Company certifies that it has reviewed and will comply with the Anti-Corruption Policy for Microsoft Representatives. Anti-Corruption Requirements Microsoft only does business with trustworthy and ethical partners. Here are requirements of Microsoft's Anti-Corruption Policy for Representatives. Compliance with Anti-Corruption Laws Microsoft partners shall conduct themselves with high ethical standards and comply with all applicable anti-corruption laws. No partner shall, directly or indirectly, promise, authorize, offer, or pay anything of value to any government official to improperly influence any act or decision for the purpose of promoting the business interests of Microsoft. Facilitating Payments Prohibited Microsoft prohibits bribes of any kind, including facilitating payments. A facilitating payment is a payment made to secure or expedite a routine government action by a government official. 3

4 Due Diligence Microsoft requires that certain partners undergo due diligence procedures, typically called "vetting" before they are permitted to start or renew a business relationship with Microsoft. Partners must comply with Microsoft's procedures and requests for information for due diligence or "vetting" of partners. Money Laundering Prohibited No Microsoft partner shall use its relationship with Microsoft to disguise or attempt to disguise the sources of illegally obtained funds. No Payment of Travel, Gifts, or Hospitality Expenses Microsoft partners are prohibited from paying expenses for travel, lodging, gifts, or hospitality for government officials on Microsoft's behalf. Partners are also prohibited from using any funds provided by Microsoft, or any proceeds resulting from any Microsoft business, to pay expenses for travel, lodging, gifts, or hospitality for government officials. Accurate Books and Records Partners must record payments and other compensation in their corporate books, records, and accounts in a timely manner and in reasonable detail. No undisclosed or unrecorded accounts may be established for any purpose. False, misleading, incomplete, inaccurate, or artificial entries in the books and records are prohibited. Partners must also develop and maintain a system of internal controls to prevent the payment of bribes and provide reasonable assurance that financial statements and reporting are accurate. No Personal Funds Do not use your personal funds to accomplish what Microsoft prohibits or to circumvent Microsoft policies and procedures. No Retaliation Microsoft prohibits retaliation against any partner who has, in good faith, reported a red flag or a possible violation of the law or Microsoft's Anti-Corruption Policy. No partner will suffer adverse consequences for refusing to pay or take a bribe, even if this results in the loss of business to Microsoft. Enforcement Partners are subject to criminal and civil penalties from government authorities for violating anticorruption laws. Microsoft may also refer any partner who violates its anti-corruption policy to government authorities for criminal prosecution or other enforcement action, or bring suit for damages. 4

5 Reporting Concerns Partners must report concerns, red flags, and any possible or suspected violation of the law to Microsoft using the resources described in the Reporting section. Standards for Subcontractors Microsoft requires that partners hold their subcontractors and representatives to the same standard that Microsoft applies to its representatives. Partners should conduct their own due diligence before hiring subcontractors and representatives to ensure they are legitimate business enterprises, qualified to perform the function for which they are being retained, trustworthy, and ethical. Partners may be held responsible for the actions of their third parties. Global Enforcement Corruption is a global issue. Every country in which Microsoft operates prohibits corruption. In addition, the U.S. Foreign Corrupt Practices Act (FCPA) extends to Microsoft and its partners' activities worldwide. Anti-corruption laws are enforced globally and across borders. Learning Activity: Consequences of Corruption What are the consequences for violating anti-corruption laws? A. You can go to jail. B. Your company can be prosecuted by government authorities and barred from conducting business. C. Your company, and you personally, can be required to pay large penalties and fines. D. Microsoft can terminate your contract. E. Your company's customers will not do business with you and your reputation can be harmed. F. You and your company can be subject to civil lawsuits. 5

6 The correct answer is all of the above. Anti-corruption laws impose criminal penalties. That means you can go to jail for being involved with a corrupt payment, and many other negative consequences could follow. The next section will show you how to avoid involvement in potentially corrupt activities and comply with Microsoft's anti-corruption policy. Avoiding Corruption Introduction Now that you understand the basic requirements of Microsoft s Anti-Corruption Policy for Representatives, let s learn more about how to avoid corrupt or suspicious payments. What Is a Bribe? A bribe is offering, promising, authorizing, or giving anything of value to anyone, directly or indirectly, to obtain an improper benefit such as obtaining or retaining business for Microsoft or its partners. To learn more about what this means, look at each part of the sentence more closely. Offering, promising, authorizing, or giving Offering or promising a corrupt payment is prohibited, even if the payment is not made or refused. A bribe does not have to be successful to be illegal. Even if the official does nothing in return, if you corruptly pay or promise something of value to an official, it is a bribe. Anything of value A bribe can take many forms. "Anything of value" includes cash, gifts, travel, hospitality, loans, charitable donations, favors, or job opportunities. There is no minimum amount for something to be considered a bribe even small payments can be bribes. 6

7 To any type of recipient Most anti-corruption laws focus on bribes for government officials, although some countries also prohibit private sector bribery. Microsoft's policy prohibits bribes in all forms, regardless of whether the recipient is in the public or private sector. Directly or indirectly Even if you don't make the improper payment yourself, you can be liable if you authorize somebody else to do so, or ignore their doing so. You can be held responsible for the actions of your employees and subcontractors. To obtain a benefit for Microsoft or its partners Any attempt to improperly influence or affect the decision-making of an individual is prohibited. This includes attempts to influence the award or retention of a contract, reduce duties or fees, guarantee more timely delivery, expedite an approval or permitting process, or affect the outcome of a government decision. Conducting business ethically and within the law is the right thing to do. Who Is a Government Official? (1 of 2) Microsoft's Anti-Corruption Policy for Representatives prohibits corrupt payments to "government officials." Partners should always understand when they are dealing with government officials, and exercise diligence to ensure their conduct complies with Microsoft's policies and the law. Government officials include: Employees of a government entity Elected officials Private persons acting on behalf of a government entity Officers and employees of companies owned or controlled by the government Candidates for political office Political party officials Employees of public international organizations (for example, the World Bank) 7

8 Who Is a Government Official? (2 of 2) It isn't always easy to identify government entities or their employees. Any of these people may be considered government officials: A doctor or lawyer employed by a state agency or a state-owned enterprise A political party official A consultant for a government official An employee of a company owned or controlled by the government A teacher employed by a city or town An employee of a government entity or agency No Travel, Gifts, or Hospitality (1 of 2) An improper benefit to an official can take many forms. Paying the travel expenses of a government official, or providing gifts or hospitality, can be improper if they are lavish or unrelated to a legitimate business purpose. Microsoft recognizes that small gifts or tokens of esteem or gratitude can be an appropriate way for business people to display respect for each other and might be customary in some business deals. However, lavish, expensive, or extravagant gifts, travel, or hospitality may be viewed as bribes if given with an improper purpose. 8

9 No Travel, Gifts, or Hospitality (2 of 2) Microsoft prohibits partners from paying expenses for government officials' travel, lodging, gifts, meals, and entertainment in connection with business for Microsoft. Every partner agrees in their contract with Microsoft that they will not pay any of these expenses: Company acknowledges that it is prohibited from paying expenses for travel, lodging, gifts or hospitality for government officials on Microsoft's behalf. Company also acknowledges that it is prohibited from using any funds provided by Microsoft, or any proceeds resulting from any Microsoft business, to pay expenses for travel, lodging, gifts or hospitality for government officials. Learning Activity: Travel, Gifts, & Hospitality Consider the following scenario: A customer in a Microsoft deal asks you to pay for travel to a U.S. Microsoft office to attend a Microsoft product briefing. The customer also requests that the itinerary include a side trip to Las Vegas. How should you respond? A. Pay for the entire trip, because the travel is for a legitimate purpose. B. Ask a travel agency to pay for the customer's entire trip and then reimburse the travel agency. C. Pay for the customer's trip to the Microsoft office, but refuse to pay for the side trip to Las Vegas because it is not related to the business purpose of the travel. D. Tell the customer you may not pay travel expenses on Microsoft's behalf, but that you will pass the request on to Microsoft. The correct answer is D. Microsoft pays for the travel expenses for officials when there is a legitimate purpose and need, but Microsoft does not want partners and other representatives paying travel expenses on its behalf. Side trips that do not have a legitimate business purpose are never permissible. 9

10 Hiring Partners may not use employment opportunities to improperly influence the decision making of government officials. Offering a job to a government official, or employing the official's friends or relatives, may be viewed as offering "something of value" to the official that may constitute a bribe if there is an improper purpose. Learning Activity: Hiring Consider the following scenario: A customer in a Microsoft deal is a government official. In a sales meeting about the Microsoft deal, the official says that his son has recently graduated from college and is looking for a job. He says he will place a larger order if the partner or Microsoft hires his son. How should you respond? A. Tell the official you will look into the matter, and ask the official to send you the son's resume. B. Tell the official that neither the partner nor Microsoft can hire the official's son. C. Promise you will hire the official's son, but only after the deal closes and only if there are job openings available with the partner or Microsoft. The correct answer is B. The official has linked the hiring of his son to the sale of Microsoft products. The official has asked for a bribe, which must be declined and reported to Microsoft. 10

11 Charitable Donations Many companies, including Microsoft, engage in charitable giving to their communities. However, partners may not use charitable donations as a way to bribe officials. When it comes to Microsoft business, partners should not make any charitable donation that might provide a personal benefit to a government official, or that is an exchange of favors with an official. If an official makes a promise or threat related to a donation request, the request must be denied and reported to Microsoft. Did You Know? Companies have been penalized for making donations to charities favored by government officials in order to induce the officials to direct business to the company. Even though the charities were legitimate organizations, the payments from the companies were intended to corruptly influence officials, and therefore violated anti-corruption laws. What Are Red Flags? When dealing with customers, suppliers and representatives, watch out for warning signs of an increased risk of improper or corrupt behavior ("red flags"). A red flag is anything that creates a suspicion of improper or corrupt behavior. Here are some examples of red flags: Excessive commissions Unreasonably large discounts Contracts that do not accurately reflect the actual economics of the deal Non-standard terms, or unusually complex terms or billing practices Insufficient or non-transparent documentation "Consulting agreements" that include only vaguely described services 11

12 On the next page, you'll see some more examples of red flags and some examples that are not red flags. Learning Activity: Red Flags Which of the following are red flags? A. Representatives whose business purpose in a transaction is dubious or unclear. B. Representatives who are related or closely associated with a government official in a deal C. Representatives who have been thoroughly vetted D. Representatives who became part of the deal at the request or insistence of an official E. Representatives who are shell companies incorporated in another country F. Representatives who request payment to offshore bank accounts G. Representatives who are experienced in working with government officials Answer: A, B, D, E, and F are all red flags. Report Red Flags If you see a red flag, you must report it to Microsoft. You can report to Microsoft through several methods, which are described in the Reporting section. Partners will never suffer adverse consequences for taking the action of reporting a red flag in good faith. 12

13 Learning Activity: Avoiding Corruption Consider the following scenario: You are competing against another partner to close a deal with a government customer. The customer says that they would like to give your company the deal, but your company needs to "pay a little extra" to help support the re-election of a government minister. What should you do? A. I will pay so my company does not lose the deal to a competitor. B. I will tell a subcontractor to pay so it does not come from my company. C. I think this is a request for a bribe; I will refuse to pay and will report the request to Microsoft. D. I will do nothing and hope for the best. The correct answer is C. This appears to be a request for a bribe. Partners must never pay a bribe directly or indirectly, even it means a loss of business. Reporting the issue to Microsoft allows Microsoft to investigate the concern and take appropriate action. Microsoft does not do business with corrupt partners or customers. Microsoft will not tolerate retaliation against anyone who has, in good faith, reported a possible violation of its Anti-Corruption Policy or refused to participate in activities that violate this policy. Accuracy & Transparency Introduction Anti-Corruption laws require more than not paying bribes. They also require that companies have accurate records, strong internal controls, and do business in a transparent manner. 13

14 Accurate Books and Records Partners are required both by Microsoft and anti-corruption laws to keep accurate books and records. Accurate books and records help ensure compliance with anti-corruption laws. False, misleading, incomplete, inaccurate, or artificial entries in books and records are prohibited. Learn more about what this means on the next page. Requirements for Accuracy and Transparency Learn more about what requirements apply to partners. Strong Internal Controls Partners must develop and maintain a strong system of internal controls to prevent the payment of bribes and provide reasonable assurance that financial statements and reporting are accurate. Explicit and Transparent Contracts and Pricing Contract terms, conditions, and pricing should be explicit and transparent, and reflect the actual economics of the deal. Provide Proof of Execution Microsoft may require partners to provide Proof of Execution (PoE) to justify payment of certain funds, for example, channel incentives or Business Investment Funds (BIF). Always comply with Microsoft requirements for PoE. Accurate and complete PoE can help your company and Microsoft implement effective internal controls. No Undisclosed Accounts Partners must not have undisclosed or unrecorded accounts, and only use the bank accounts authorized by Microsoft agreements to make and receive payments. Avoid Shell Companies and Offshore Accounts Avoid the use of shell companies incorporated in other countries, and avoid the use of offshore bank accounts for payments. 14

15 Enforcement Example The importance of keeping accurate books and records and strong internal controls is illustrated by a 2012 public enforcement action against a large technology company and its subsidiary. The Charge The technology company was charged by the U.S. Securities and Exchange Commission (SEC) with violating the U.S. Foreign Corrupt Practices Act (FCPA) by failing to prevent its subsidiary from secretly setting aside money off the company's books. The money was eventually used to make unauthorized payments to phony vendors in a non-u.s. country. What Happened The SEC believed that the subsidiary and a distributor put a portion of the proceeds from government sales in an off-book account, or side funds, to which the distributor had access. The subsidiary directed the distributor to make payments to various third parties from the off-book account. The SEC was concerned that this arrangement "created the risk that the funds could be used for illicit purposes such as bribery or embezzlement." The Company's Violations The SEC stated that the technology company violated the FCPA's books and records provisions and internal controls provisions by failing to accurately record the side funds that the subsidiary maintained with its distributors. The technology company also failed to devise and maintain a system of effective internal controls that would have prevented the improper use of company funds. The Settlement To settle these charges, the technology company agreed to pay a $2 million civil penalty and to accept an injunction against future violations of the accounting provisions. What It Means For You Partners should not create side funds or side accounts that could be used for Microsoft business. The money partners receive from Microsoft deals or incentives may never be used for any improper purpose. 15

16 Reporting & Resources Reporting Concerns If you have a concern or need further guidance related to the topics in this course, contact Microsoft's Office of Legal Compliance. You will find detailed contact information on the next screen. In addition, if you are aware of any violations of the law or Microsoft policy or any red flags indicating an issue might be a concern, you must report them to Microsoft. Microsoft prohibits retaliation against any partner who has, in good faith, reported a red flag or a possible violation of the law or Microsoft's Anti-Corruption Policy. No partner will suffer adverse consequences for refusing to pay or take a bribe, even if this results in the loss of business to Microsoft. Contacting the Office of Legal Compliance You can contact Microsoft's Office of Legal Compliance with concerns or questions by any of the following means: Call: Microsoft Business Conduct Hotline In the U.S.: MSFT (6738) Outside the U.S. (collect): Business Conduct and Compliance alias (buscond@microsoft.com) Online: Microsoft Integrity Website ( Mail: Director of Compliance Office of Legal Compliance One Microsoft Way Redmond, WA USA 16

17 Fax: Microsoft will handle all inquiries discreetly and, to the extent possible and within the limits allowed by law, preserve the confidentiality of anyone reporting a possible violation or providing information in an investigation. We encourage you to identify yourself, but you may also submit your report anonymously, where permitted by law. Resources The following resources can provide you with further information and guidance related to the topics in this course. Microsoft Standards of Business Conduct Anti-Corruption Policy for Microsoft Representatives Microsoft's Commitment to Anti-Corruption Congratulations on completing this course! Thank you. 17