Corporate Governance Chapter 5 senior staff are recruited. This is quite possible, considering that many private enterprises are small and/or family owned and not eager to recruit staff from outside the family circle. It is difficult to monitor and reinforce management transparency in a country where 65,203 (70 per cent) of the 92,388 SMEs registered in 2007 are small establishments.44 This group comprises mainly family-owned enterprises that employ an average of 1.1 workers. Success in the prosecution of cases of corruption, money laundering, insider trading and other forms of unethical practice, as well as the seriousness of penalties imposed (including blacklisting and suspension by professional associations) 756. 757. The Report of the Select Committee on the Funding of Political Parties (by private companies and pressure groups)45 admits that these organisations should be allowed to fund political parties if: • • • 758. 759. 268 ICAC admits that tapping phones is one of the most efficient ways of getting evidence quickly for investigating allegations of money laundering and corruption. Developed countries allow the practice, but Mauritians do not accept it. Completed ICAC investigations are forwarded to the director of public prosecutions (DPP) for action. However, ICAC recognises that investigations into corruption take too long for various technical reasons. These include the fact that there are about 52 different forms of corruption, each with different offences, and that the procedures for accessing banking details is time consuming. ICAC proposes amending the legal framework to make it more acceptable to the private sector. There is adequate disclosure and a regulator has sufficient power to intervene where there are real risks that political parties are being funded for ulterior motives. Open declarations are made in respect of donations of more than Rs100,000 nationally or of Rs10,000 in one constituency. Shareholders fix a permissible amount for these donations. The CRM believes that it is difficult for the regulatory body to know in advance the intention of an organisation that decides to fund a political party. ICAC also stresses the challenges and constraints it faces in achieving its mission. These include overexposure to the media, shortages of adequate equipment and expertise, and insufficient investment in public education and awareness campaigns. 44 - CSO. 2007. Republic of Mauritius Census of Economic Activities. Small Establishments. pp 30–31. 45 - Report of the Select Committee on the Funding of Political Parties. October 2004. Chapter 5 Box 5.1: Corporate Governance ICAC Of the many initiatives ICAC has taken to prevent mismanagement of funds by public corporations, one of the most recent is the Internal Audit Charter. This contains guidelines aimed at introducing a disciplined approach to evaluating and improving the effectiveness of risk management, control and governance processes. ICAC is the body entrusted to investigate all types of corruption, money laundering and similar malpractices. Its board does not fall under the authority of a minister. The prime minister appoints its director-general in consultation with the leader of the opposition. ICAC was established on 1 June 2002. ICAC’s philosophy is to change the hearts and minds of everyone in the community through the three main elements of the national strategy contained in POCA. These are to: • • • Enforce the law. Prevent corruption by removing opportunities for corruption from systems and procedures. Prevent corruption through public education and support. ICAC may track corruption practices and bring suspected offenders to the judiciary, especially the DPP. In addition to its primary role of investigating corruption and money laundering, ICAC has created a Corruption Prevention and Education Division (CPED). Its functions include reducing the opportunities for corruption substantially, liaising with private sector organisations to establish anticorruption initiatives, conducting corruption prevention seminars, holding talks with officials, and helping organisations to develop their capacity to prevent corruption. ICAC has edited several practice guides for public and private managers on how to improve governance and to respect ethical rules. ICAC has achieved much to sensitise all stakeholders about the need to fight corruption. It has also gained credibility and respect from the public and Mauritius’s development and business partners. 760. The JEC also strongly supports respect for the code of ethics. The FRA entrenches the Code of Corporate Governance. The JEC has adopted a model code of conduct and has strongly recommended that each of its nine affiliate organisations adopt it. The JEC defines a code of conduct as “a comprehensive statement of the guiding principles of conduct by which a company expects its directors and employees to behave when carrying out their work to be more efficient”. Procurement of goods and services 761. Procuring goods and services often means that the administrators of public departments and private enterprises have to interact. ICAC has therefore issued the Best Practice Guide for Public Bodies.46 Its aim is to advise them on the policies and procedures for procuring, selecting suppliers, quoting, evaluating tenders, inspecting and 46 - ICAC. December 2004. Best Practice Guide for Public Bodies. 269