6.3. Assessment of Corruption Risks Encountered by an Organisation in Its Business Environment

 

Depending on their size, field and type of activities, geographical position, structure, age, education and social status of the staff, available suppliers and clients, the type of their activities and many other factors, different business organisations may encounter different risks of corruption, therefore, in order to prepare an effective anti-corruption programme for a specific organisation and / or choose the best anti-corruption measures, it is necessary to determine the corruption risk factors that can manifest namely in the operating environment of the specific organisation[71].

 

For this purpose, it is first of all advisable to perform an environment analysis of the organisation.

 

The environment analysis is based on the principles of strategic planning and includes the analysis of external and internal factors as well as the analysis of threats and opportunities in the organisation.

 

In performing the analysis, the following may be used:

  • sociological research data on most common unlawful acts in the private sector[72];
  • information received by conducting performance audits in the business organisation;
  • information received by investigating disciplinary and other forms of misconduct;
  • consultations of experts of business, law, corruption prevention and specific fields of business;
  • summarised information on the key and major corruption-related problems in different fields of the public sector prepared by the STT[73];
  • corruption risk factors in the private sector identified by scientists[74].

 

The aforementioned information should help understand the problems of corruption and corruption risks in a specific organisation.

The analysis should be followed by the selection of most appropriate corruption prevention measures for dealing with the problems identified during the analysis.

 

Probably the most common corruptive acts in the private sector occur, when employees:

  • use the organisation's property (misappropriation or using it for personal purposes);
  • contact suppliers (choosing specific suppliers and negotiating the prices of goods, services and other things);
  • contact competitors (agreements regarding market division or price fixing);
  • contact the public sector (using administrative services of the public sector (for example, applying for permissions, licences or documenting a certain legal fact, submitting declarations and their administration, etc.), participating in public procurement, when public administration entities conduct audits in business organisations, etc.).

 

In view of the foregoing, it is of essential importance that:

  1. The functions, tasks, the work and decision-making procedure as well as responsibility of the persons authorised to conduct these actions are covered by detailed regulations.
  2. Periodic checks on the activities are performed.
  3. Ethical behaviour and anti-corruption awareness of employees is developed.

 

It should be noted that as of 1 January 2017 the Republic of Lithuania Law Amending Article 6 of the Law on Prevention of Corruption No. IX-904 [75] enters into force. Pursuant to which , within the scope of Article 6, all state and municipal enterprises, as defined in the Republic of Lithuania Law on State and Municipal Enterprises, also enterprises, where the ownership of the shares grants the State or a municipality more than 50% of the votes at the general meeting of shareholders as well as enterprises, where the State or a municipality can appoint more than half of the members of the company's administration, managerial  or  supervisory body, will be treated as state and municipal institutions.

Having regard to the new amendments, the above-mentioned state and municipal enterprises, following Article 6 of the Law on Prevention of Corruption and paragraph 7 of the Procedure for Performing the Corruption Risk Analysis[76], in the third quarter of each year must perform the determination of the probability of corruption manifestation in their activities and to provide information on that to appropriate ministries or municipalities managing them.

 

More information on the determination of the probability of corruption manifestation is available in Chapter 7 of the Handbook on the Creation and Implementation of Anti-Corruption Environment in the Public Sector.

 

It should be noted that the determination of the probability of corruption manifestation might be one of the tools, by using which the vulnerable to corruption activity areas may be identified in the organisation; and on the basis of the results, the necessary prevention measures are selected.

When the amendments to the Law on Prevention of Corruption come into force, the STT will also be granted authorisations to conduct corruption risk analyses in state and municipal enterprises.



[71] Corruption risk factors — conditions, events and circumstances, which may give preconditions for corruption.
[72] Please refer to the sociological research described in Chapter 3 of the Handbook.
[73] http://www.stt.lt/documents/nkkp_2015-2025/rastas_TKKK_del_rizikos_veiksniu_2016-02-08_(1).docx 

http://www.stt.lt/documents/nkkp/4-01-7239.pdf 
[74] http://www.stt.lt/documents/soc_tyrimai/Korupcija_privaciame_sektoriuje._LTI.pdf 
[75] https://www.e-tar.lt/portal/lt/legalAct/31ecf140ab3f11e6a6f98c1425a5ffa8  
[76] The Procedure for Corruption Risk Analysis approved by  Government of the Republic of Lithuania Resolution  No. 1601 of 8 October 2002 is available here: https://www.e-tar.lt/portal/lt/legalAct/TAR.B96A881B578F