In recent years, high-profile accounting scandals involving U.S. companies like Enron and WorldCom and cases of fraud and corruption have renewed public interest in ethical business practices.
In the annals of corporate history, those involved will be remembered for their crimes, not for their business savvy.
In stark contrast are companies that operate from a solid foundation of corporate governance and that require employees to meet high ethical standards. These companies have staying power. They are better able to stay competitive within the global marketplace, maintain public trust and recruit the top talent.
Patrick Garver, Barrick Gold’s executive vice-president and general counsel, knows that ethical conduct is good business. Garver oversees company-wide compliance of Barrick Gold’s Code of Business Conduct and Ethics. Garver and the Office of the General Counsel have championed ethical leadership at every level of the company, from the mine site to the boardroom. They have had strong backing from Barrick Gold’s President and CEO, Aaron Regent, the company’s Chairman and Founder Peter Munk, and Barrick Gold’s senior leadership team.
Garver’s message to all employees combines company values with personal responsibility. “It has to be the responsibility of each and every one of us, no matter what our position is, no matter what part of the company we work in, to consistently demonstrate the best of Barrick,” he stated. “And the best of Barrick is an unwavering commitment to ethical behavior.”
Barrick Gold’s Code of Business Conduct and Ethics is an umbrella policy that commits the company to conduct its business around the world to the highest ethical standards and to obey all applicable laws and regulations.
Barrick Gold has also put in place a range of specific policies prohibiting corruption, fraud, bribery, discrimination, money-laundering and insider trading, as well as policies on safety, human rights and security practices and environmental management.
All Barrick Gold employees receive training on how to apply Code principles using real life scenarios ranging from unfair dealing and accounting issues, to potential conflict of interest, to workplace harassment, bribery and other Code violations. This training is useful to all employees but critical for those in positions of trust, who act on behalf of the company, have an influence on financial reporting or deal with public officials. The training sessions are designed to provide clear direction should a situation or ethical dilemma arise. Employees are strongly encouraged to seek out guidance, ask questions and speak out if they suspect wrongdoing. Vigilance is particularly important in developing countries with weak governance institutions, where employees are required to exercise heightened care. Barrick Gold makes a variety of options available to its employees for reporting suspected misconduct, including a 24-hour, multilingual compliance hotline. If you visit a Barrick Gold mine site, chances are you will see the compliance hotline number on display in an open area. Employees using the hotline may identify themselves or remain anonymous. Complaints are then reported by a service provider to the Office of the General Counsel for appropriate action. Barrick Gold will include a report on the use of the company’s whistle-blowing Confidential Hotline in the annual Responsibility Report due out May 2010.
“Today, the expectation that companies will conduct business in an ethical way knows no boundaries,” said Garver. He notes that enforcement authorities in the United States and around the world are prosecuting corporate bribery cases at an increasing rate.
Garver recently spoke at a Miami conference on the U.S. Foreign Corrupt Practices Act, legislation that prohibits corporate bribery and corruption of government officials. At the conference, senior officials with the U.S. Department of Justice and the U.S. Securities and Exchange Commission, lawyers and industry executives discussed regulation, enforcement and anti-corruption compliance issues.
“There are profound consequences for companies that fail to take action when presented with possible evidence of corrupt practices,” said Garver. “Even a single incident of corruption can lead to irreparable reputational damage to a business.”
During the conference, Garver discussed Barrick Gold’s compliance program. “It is critically important for companies like Barrick Gold with a global footprint to have a strong anti-corruption strategy, combined with an effective compliance program,” he stated. “But a compliance program is only as good as the rigor with which it is supported by a company’s senior leadership and employees, integrated into the ethical culture of the company, and consistently monitored and enforced.”