The prospect of corporate profit is currently related to aspects of corporate social responsibility, such as transparency of financial activities and operational trust. The main objective of this article is to outline the anti-corruption measures applied in Canada that Brazil should use for corporate development. This critical analysis provides useful insights about the implementations of international conventions and the improvement of access to information, emphasizing the legal mechanisms that need to be developed to improve global compliance standards.

Evolution and current issues in compliance

In today’s globalized business context, issues such as compliance and corporate governance are becoming increasingly relevant. It is essential to understand compliance as the set of measures and practices adopted by companies to ensure adherence with national and international standards and regulations. Thus, the gradual adherence to compliance reflects a movement towards greater transparency and corporate responsibility.

It is undeniable that a good reputation takes years to build and only minutes to lose. For instance, in Brazil, after so many episodes of investigations, coercive detentions, reputational damage, arrests and various lawsuits, companies and Brazilian society are increasingly losing confidence in the implementation of a good anti-corruption compliance system in corporate law.

The anti-corruption regimes in Brazil and Canada have recently undergone important reforms, following the international trend started by the United States in 1977. Therefore, Brazil and Canada are both signatories to the OECD (Organisation for Economic Co-operation and Development) Convention, which obliges signatory countries to adopt laws prohibiting corruption of public officials and to impose effective sanctions in the event of violations of these laws.

It is crucial to mention that Canada faces challenges with the lack of robust provincial guarantees, compromising the reliability of Canada’s obligations to treaty partners. The Canada-European Union Comprehensive Economic and Trade Agreement (CETA) negotiations suggest that the absence of legal incentives for provincial compliance are problematic for negotiating partners seeking significant commitments in areas of provincial jurisdiction. Despite these obstacles, Canada has a vast consolidated practice in the implementation of anti-corruption measures, leveraged by the Corruption of Foreign Public Officials Act – CFPOA.

International collaboration

The first measure implemented by Canada that Brazil should adopt concerns international collaboration, given that Canada has been active in international collaboration to combat corruption, participating in global initiatives such as the United Nations Convention against Corruption and collaborating with other countries to share best practices and technologies. This global approach allows for the exchange of knowledge and the coordination of efforts to fight corruption more effectively.

The international conventions ratified by Brazil, although originating from different organizations, have several elements in common. They all establish the obligation of the signatory states to prohibit the practice of bribery and corruption by international companies. However, these rules are incomplete and need to be implemented and detailed in domestic law.

An interesting aspect is the provision in international treaties for peer review mechanisms, which allow states to monitor compliance with the treaty, exchange experiences and improve standards. On this last point, the use of soft law as a way of complementing the pact grants an interesting flexibility to the legal system of these organizations, allowing for constant evolution.

In addition, the Inter-American Convention Against Corruption stands out for its prohibition on the creation of laws that grant favorable tax treatment to the practice of bribery (art. III, 7), in the form of the traditional tax deduction of bribes as “business expenses”. Among the countries that are part of the OAS (Organization of American States) Convention and have ratified the Convention, only Canada has ever had legislation that allowed for deductibility (MORENO OCAMPO, 2000, p. 61). Inspired by the FCPA (Foreign Corrupt Practices Act), the OAS recommended the creation and strengthening of mechanisms that oblige companies to keep records capable of accurately reflecting the acquisition and disposal of assets (art. III, 10). These records, of course, facilitate state surveillance of corrupt practices.

In the same legal provision, the international treaty also mentions the possibility of  companies developing internal accounting controls that allow their employees to identify acts of corruption, which is, in a way, a compliance policy.

There is reference to the development of systems to protect public officials and citizens in general who report acts of corruption in good faith, including identity preservation (art. III, 8). The international standard also recommends the creation of “higher control agencies in order to develop mechanisms to prevent, detect, punish and eradicate corrupt practices” (art. III, 9), known as “anti-corruption agencies”.

The OAS Convention reserves space to develop the obligation to cooperate between member states to detect, investigate and punish acts of corruption, a situation that is certainly applicable in cases involving corruption. The idea is to consolidate reciprocal assistance between states, facilitating the exchange of information, carrying out due diligence and obtaining evidence (art. XIV, 1 and 2). There is also provision for the recovery of corrupt assets held abroad (art. XV, 1 and 2) and the refusal of cooperation cannot be based on the existence of domestic legislation guaranteeing bank secrecy (art. XVI, 1).

It is therefore clear that while Brazil is a signatory to major international anti-corruption treaties, there is a need for clearer implementation and enforcement of these agreements within the country. To effectively combat corruption, Brazil should not only fulfill its treaty obligations but also encourage companies to develop robust internal mechanisms for detecting corrupt practices.

These measures, already recognized in international conventions, can help Brazil enhance its anti-corruption framework and align more closely with global standards. By doing so, Brazil can strengthen both its domestic and international efforts to combat corruption, ensuring that it remains a committed participant in the global fight against corruption.

Access to information

Another indispensable element in developing an anti-corruption strategy is a focus on transparency and access to information. Canada has implemented policies that ensure that information about government tax activities is accessible to the public, promoting accountability and trust in public institutions. Canada’s Access to Information Act is an example of how transparency can be institutionalized, obliging authorities to disclose information and facilitating oversight by civil society.

Although Brazil has an Access to Information Law, which aims to guarantee transparency, there still remains concerns about application and effectiveness. From the Brazilian perspective, it is a real challenge to detail cases of corruption in corporate law, because these conducts, as is well known, are carried out of sight. Research of this magnitude often comes up against a veil of secrecy and misinformation, so all caution is needed when treading this unknown terrain. Therefore, one is obliged to give priority to sources that can be accessed and that appear reliable. The reports of the facts are reproductions and interpretations of information released by official bodies, based on public investigations, agreements or court decisions, and there is no room for rumors or purely personal perceptions that could in any way taint the research.

A primary source is the reports that assess compliance with international anti-corruption standards by the signatory states. Here, the documents that refer to the OECD international treaty are highlighted, in the form of individual assessments. Another important resource is the research carried out by Transparency International, which regularly publishes an independent progress report on the application of this Convention. In view of these sources, it should be noted that the research was limited to cases involving companies from member countries of the OECD Convention. Firstly, because it is the international anti-corruption treaty that has the most advanced and sophisticated evaluation system, capable of providing the necessary elements to carry out the analysis. Secondly, it is the only treaty that deals exclusively with transnational corruption, reserving a lot of space for the details of these cases.

Another problem faced was in relation to cases that are still under investigation or protected by secrecy. In the Brazilian context, not much information is released by the national criminal prosecution agencies, such as the Federal Police and the Public Prosecutor’s Office. Due to the scarcity of official information, the national and international companies find it difficult to attribute credibility to tax regulations, which leads to a loss of investment and, consequently, a weakening of the economy.

Therefore, in order to fight corruption effectively, Brazil must adopt Canadian practices focused on transparency and access to information. Firstly, it is essential to strengthen the application of the Access to Information Act, ensuring that all government and tax activities are fully accessible to the public. This involves obliging authorities to proactively disclose information, facilitating oversight by civil society.

In addition, the creation of mechanisms that encourage the active participation of society in overseeing government actions can promote a culture of accountability. Implementing regular assessments of compliance with international anti-corruption standards, such as the OECD reports, can help identify areas for improvement and ensure alignment with global best practices. These measures, inspired by the Canadian model, can strengthen the fight against corruption in Brazil, promoting greater trust in public institutions and encouraging an environment of integrity and transparency.

Conclusion

Fighting corruption through compliance programs in corporate law is a complex task, but one that is essential to guaranteeing national and international credibility. In the Brazilian context, the adoption of measures similar to those applied in Canada represents a crucial step in the fight against corruption. It is crucial that the country advances in the implementation and improvement of compliance programs, aligning itself with the best international practices and strengthening access to information. The Canadian experience should serve as a guide for creating effective internal control systems, developing transparency policies and promoting a corporate culture that prioritizes ethics and integrity.