Corporate Governance Chapter 5 Chapter 5 Code of ethics – the private sector 739. In addition, there are initiatives to encourage the private sector to adopt a code of ethics. For example, the MCCI, whose aim is to “serve and promote the interests of the business community in playing a leading role in the economic development of Mauritius”, adopted a code of ethics that it proposed to all its members in 2006. 740. In addition, the Code of Corporate Governance, published in October 2003, guides businesses in adopting codes of ethics. It suggests that codes of ethics should consider the circumstances in which companies operate and concentrate particularly on integrity and honesty. The main principles of the guidelines are that: • • • ii. integrity. Codes should define acceptable and unacceptable practice. They should be easy to communicate to all stakeholders, especially the company’s officers and employees who will rely on the codes to guide them in their dealings. 743. Codes of ethics should refer to the principles, norms and standards that companies want to promote and integrate with their corporate cultures as they conduct their activities. They should include internal relations, interactions and dealings with external stakeholders. In developing codes of ethics, companies should consider the specific circumstances and identify risk areas in the particular industries in which they operate. Where necessary, they should refer to relevant laws and regulations that apply to their activities and services. Companies should regularly monitor and evaluate compliance with established ethical principles and standards. Whenever necessary, they should reconsider the nature of their ethical relationships with stakeholders. Companies should promote awareness, both internally and externally, and emphasise the importance of adherence to exemplary standards of conduct and ethical practice. 744. According to the CSAR, the two institutions established to fight corruption and money laundering are ICAC, established in 2002, and the Financial Intelligence Unit (FIU), established by FIAMLA in the same year. The CSAR describes the mandate, structure and activities of ICAC in some depth, while it treats those of FIAMLA briefly. It does not assess or evaluate these two institutions. Nevertheless, despite their existence, there are still cases of corruption and money laundering in Mauritius. Codes should be understandable and easily communicable to all. Codes should refer to the laws and regulations relevant to the business’s activities. Once adopted, businesses should monitor compliance with the codes to ensure ethical practice. Findings of the CRM Effectiveness of regulatory oversight, including supervision by professional associations 741. Mauritius has established a number of legal and regulatory mechanisms aimed at fighting corruption, money laundering and insider trading. These include the Code of Corporate Governance, the Prevention of Corruption Act (POCA) of 2002 and the Financial Intelligence and Anti Money Laundering Act (FIAMLA) (with amendments dated June 2006). Thanks to the intervention of ICAC and the NCCG, a number of texts on codes of ethics have been issued for SOEs and private enterprises. Corruption as perceived by Mauritians 745. The Code of Corporate Governance 742. 264 The Code of Corporate Governance applies to large private companies. It defines them as “individual companies or groups of companies with an annual turnover of Rs250 million and above”. Section 7 stipulates that, when adopting codes of ethics, companies should address issues about the ethical practices that are relevant to the particular circumstances of their businesses’ environment, including how they will apply their corporate values and the concepts of honesty and Corporate Governance A national survey on corruption in Mauritius, funded by the UNDP in 2006, showed that interviewees believe that the government is the most corrupt (50.7 per cent), followed by municipalities (36.1 per cent) and the private sector (28.4 per cent). Corruption as perceived by the Mauritian business community 746. According to a recent World Bank report, Mauritius is experiencing the lowest levels of corruption. Table 5.5 gives an overview of corruption as perceived by the Mauritian business community.38 38 - World Bank. Enterprise Survey 2009. 265