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Article: Compliance as a factor of competitiveness

Everson Bassinello*

A crisis is an opportunity for changes in human behavior and evolution. A good example of that is the fight against corruption in the United States, which implemented, in 1977, the Foreign Corrupt Practices Act (FCPA). It took, however, nearly three decades, and a surge of scandals to allow the issue to become rooted in the country's business and political culture. Brazil has the same chance to improve its standards of ethics, fairness and transparency in public life since the full implementation of the Anti-Corruption Act, in force since 2014. This transformation has been consolidating itself in the business environment and influencing the public sector to follow the same movement.

There is a long way to go to reach this goal, but we have already taken the first steps. We are witnessing an unprecedented profusion of courses, seminars and workshops on compliance, and there is a growing demand in our labor market for professionals working in this area. It is an evolution of a trend that began in companies with the implementation of codes of conduct, channels for reporting ethical deviations, ombudsman offices, and corporate governance and corporate security policies.

It is often necessary to overcome internal resistance, especially in companies that are not very familiar with controls and procedures, where the requirement to establish processes, verify compliance and measure results can be confused with bureaucratization and loss of agility, efficiency and autonomy in the decision-making process in business. The challenge for those who work in compliance is to demonstrate to colleagues that, once the necessary processes and control mechanisms are implemented, the dedication and resources invested are more than offset by the reduced risks and costs, including deviations avoided, as well as the assistant in appropriate decision making and improved conditions of access to the financial market. The understanding that this path is also a factor of competitiveness requires a cultural change, and this cannot be achieved overnight.

Simultaneously, it is necessary to expand the change of mindset throughout the value chain, involving suppliers, customers and trade associations to make the business environment increasingly healthy and transparent. Participation in collective actions through associations with other companies and entities is a way of expressing the company's commitment, sharing experiences, results and actions, influencing and being influenced by good practices, and promoting improvements in the conditions of the markets and environments.

Thus, in combination with the due diligence for suppliers and customers, we prevent a company's commitment in the right direction from being compromised by partners who adopt practices that are not in line with an ethical, fair and transparent action. At the limit, such care implies even ceasing to make a business or lose customers, which is unpleasant, albeit necessary.

At Braskem, I have led as Chief Compliance Officer (CCO), since August 2016, the structuring and execution of a compliance program to be implemented over three years, evolving from a small core focusing on corporate security, which existed until then and was linked to the legal area. We began reporting to the Board of Directors, based on the understanding that this ensures more independence and autonomy to our performance. For the same reason, the practical conduct of the Ethics Channel, open for misconduct complaints, changed from internal to outsourced. A CA support committee was also created for compliance issues.

To address the mission, the budget for the area was expanded fourfold, and the team tripled in size, reaching 23 members, in addition to the support of specialized external consultants. Heads of compliance were also appointed in the regions where we operate - in addition to Brazil, United States and Mexico, as well as soon in Europe. This function is performed by senior professionals coming from large international companies that have experienced similar situations.

Internal research pointed out that over 90% of the members understand the role and importance of the compliance program, an even more encouraging index, given that our corporate culture values entrepreneurship, leadership autonomy, and planned delegation. On the other hand, the responsibility for this work increases, as the mission must be fulfilled without shaping the business model, but reinforcing principles such as liability and accountability.

The program's ambition is also high, as it is designed to place Braskem among the global leaders in this requirement. Over 150 improvement initiatives were identified, with 62 completed. The company has been adapting to national and international standards, aimed at combating bribery and corruption, in addition to curbing practices of unfair competition and conflicts of interest, among other aspects. This is a path of no return, which will be accompanied by society and markets, which are increasingly eager for transparency in companies and, in the case of Braskem, independent external monitors that are accountable to the authorities of the countries with which the company signed leniency agreements.

*Everson Bassinello, Braskem's Chief Compliance Officer (CCO).

For more information, please contact:
CDN Communication
Ana Beatriz Paschoal (55 11) 3643-2737 - anabeatriz.paschoal@cdn.com.br
Rafael Abrantes - (55 11) 3643-2772 - rafael.abrantes@cdn.com.br
Priscila Ventura - (55 11) 3643-2744 - priscila.ventura@cdn.com.br