Business ethics

PETRONAS has been recognised by global corruption watchdog Transparency International for its organisational transparency, anti-corruption programmes and country-by-country reporting. The Malaysian oil and gas company ranks fifth in the overall index for corporate reporting among companies in emerging markets. Its continuous efforts to drive integrity and good corporate governance has been demonstrated through various programmes that include:
1. Signing of the Malaysia Corporate Integrity Pledge (CIP) with the government in 2012. It is a voluntary effort to make a unilateral declaration against corrupt practices and to operate with the highest standard of business ethics and principles.
2. Signing of a memorandum of understanding (MoU) with the Malaysian Anti-Corruption Commission (MACC) to elevate awareness and eradicate bribery and corruption within the organisation.
3. Developing the Petronas Integrity Compliance Framework (PICF) in 2013 to support the Petronas Code of Conduct and Business Ethics (CoBE). A detailed guideline called the Anti-Bribery and Corruption Policy and Manual (ABC Manual) was then established and a No Gift Policy was put in place, prohibiting Petronas staff to give and receive gifts to avoid bribery and corruption.
4. It has also driven various awareness programmes, seminars and talks, including activities that collaborate with other anti-corruption governing and enforcement agencies in Malaysia. These activities and initiatives are communicated to everyone including staff and external parties.
IMPLEMENTING INTEGRITY
Petronas chief integrity officer (CIO) Datuk Samsiah Abu Bakar (pix), former Malaysian Anti-Corruption Commission director of prevention and education division), said: “Being able to demonstrate integrity in business, accountability and to practise anti-corruption is essential to sustain good reputation. It was easy for Petronas to drive the Petronas Integrity Programme because we had full support and commitment from the leaders.”
The first implementations were to address the policy and procedures, as well as systems and processes as outlined in the PICF. The execution was based on three approaches namely:
1. To continuously educate and promote awareness on corporate integrity;
2. To drive prevention; and
3. To enhance what were the current efforts, policies and procedures.
“Subsequently, we established a booklet to guide the management in implementing integrity programmes at their business and operating units,” shared Samsiah, referring to the ABC Manual.
Considering the fundamentals of the PICF and CoBE, the booklet was created around the framework of these six elements, which include proportionate procedures, risk assessment, due diligence, communication, training, as well as monitoring and review.
ZERO TOLERANCE
In promoting integrity, Petronas adopted a zero-tolerance stance against bribery and corruption. The company communicated this through its CoBE, which incorporates guidance on dealing with identified critical components stated in Petronas’ ABC Manual. The components in the ABC Manual include gifts, entertainment and corporate hospitality; dealing with public officials; corporate social responsibility (CSR); sponsorships and donations; political contributions; facilitation of payments; money laundering; dealing with third parties; recruitment of employees; and whistleblowing policy.
“Various training initiatives were developed to ensure the highest standards of integrity are applied across business activities that run at all levels, from the organisation’s directors and top management, middle management, its executives as well as non-executives,” said Samsiah. The latest development was the online Petronas Compliance Desktop where staff members are required to complete the e-Learning Modules on CoBE and the ABC Manual.
In addition, the company implemented the Petronas Vendor Integrity Programme (PVIP), which is a third party awareness programme in collaboration with the Malaysian Anti-Corruption Academy (MACA). It is designed to cater to all Petronas vendors as part of its initiative to create zero tolerance to bribery and corruption.
“It is important to ensure our understanding and standards of ethics are in line with that of our contractors and vendors. At the end of the programme, participants will have a better appreciation of Petronas’ commitment to fight unethical and corrupt behaviour across its business both domestically and internationally. The programme exposes them to the laws and jurisdictions related to bribery and anti-corruption and provides better understanding of Petronas’ Anti-Bribery and Corruption Policy and Guidelines.” As an advantage, participants will receive a certificate from MACA as evidence of their commitment to embrace high integrity culture and compliance knowledge among its employees, which in turn raises their company’s profile and credibility for future business dealings.
While ranking fifth in the overall index for corporate reporting is an achievement for Petronas, the company is dedicated to work harder to score higher through all its initiatives, said Samsiah.
“Enhancement is also our objective and I am confident that the company will improve its business conduct and develop better awareness, policies and systems to uphold good corporate governance.”