05.02.2019

In order to develop an effective anti-corruption program, the company must first understand its activities and environmental risks.

What is needed for corruption risk assessment?

Guidelines for corruption risk assessment and risk management

Identify the major functional areas of the organization (e.g., procurement, distribution, sales)

Identify the risks for each functional area and assess the extent of these risks

Identify the significant risks and assess the probability of those risks occurring

Identify responses to risk areas

Select the best response

Develop risk management measures

Formalize and document a risk management plan

Implement the risk management plan

Review and evaluate the risk management plan and its implementation

 

It is necessary to periodically perform risk assessment. Although there is no definite rule for what “periodically” means, international best practice recommends doing risk assessments annually or every two years. Based on the results, it is necessary to update the risk matrix and risk management plan, also known as a mitigation action plan.

The risk management plan should be as specific as possible by making improvement objectives time bound (going as far into the future as 3-5 years) and assigning specific tasks to particular functions in the company, and at the same time consult with the responsible staff for the relevant activities.

Source: Center for International Private Enterprise

This material has been prepared in the scope of the “Armenia: Promoting Anti-Corruption Conduct and Reforms” Project implemented by the “Center for International Private Enterprise”, the “Armenian Lawyers’ Association” NGO, the “Corporate Governance Center” NGO and the “Yerevan Chamber of Commerce and Industry” with financial support of the National Endowment for Democracy. The project is implemented as a co-financing to the “Commitment to Constructive Dialogue” action implemented with the financial support of the European Union by a Consortium comprising the “Armenian Lawyers’ Association” NGO, the “Armenian Center for Democratic Education-CIVITAS” NGO, the “International Center for Human Development” NGO, the “SME Cooperation Association” NGO, the Union of Communities of Armenia, as well as “Agora Central Europe” NGO (Czech Republic). The contents of this material are the sole responsibility of the “Armenian Lawyers’ Association” NGO and can in no way be taken to reflect the views of the National Endowment for Democracy and the European Union.