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   This module is a resource for lecturers   

 

Exercises

 

This section contains suggestions for pre-class and in-class educational exercises, while a post-class assignment for assessing student understanding of the Module is suggested in a separate section.

The in-class exercises in this section are most appropriate for classes of up to 50 students, where students can easily be organized into small groups in which they discuss cases or conduct activities, after which group representatives provide feedback to the entire class. Although it is possible to create the same small group structure in large classes comprising a few hundred students, it will be more challenging, and the lecturer may need to adapt facilitation techniques to ensure sufficient time for group discussions and for providing feedback to the entire class. The easiest way to deal with the requirement for small group discussions in a large class is to ask students to discuss the issues with the four or five students sitting closest to them. Given the time limitations, not all groups will be able to provide feedback during each exercise. It is recommended that the lecturer makes random selections and tries to ensure that all groups have the opportunity to provide feedback at least once during the session. If time permits, the lecturer can facilitate a discussion in plenary after each group has provided feedback.

All exercises in this section are appropriate for both graduate and undergraduate students. However, as students' prior knowledge and exposure to these issues vary widely, decisions about appropriateness of exercises should be based on their educational and social context. The lecturer is encouraged to relate and connect each exercise to the Key issues of the Module.

It is recommended that lecturers begin building a conducive and friendly environment at the start of class and before conducting the very first exercise. This can be done by breaking the ice in a supportive way, by respectfully examining students' starting orientations to corruption, and by demonstrating genuine interest in their perspectives. Once students come to see the lecturer as respectful, genuinely interested in their orientation to the material, and consistent in policing any snide or unsupportive comments by class members, that safe space will enable effective learning and development.

 

Pre-class exercise 1: What do we know about business integrity?

This pre-class exercise could be completed as part of the class preparation process. Before attending the class, ask students to complete one or more of the six interactive learning modules from the e-learning tool " The Fight against Corruption".

The modules, which are freely available online in over 30 languages, explore some of the ethical dilemmas that are typical in the business world. Some of the issues raised therein are also covered in the present Module 5, such as a company's gift policy. During the class, the lecturer could refer to the videos when discussing certain issues. In addition, the lecturer could start the class by raising questions about the ethical dilemmas reflected in the videos.

Lecturer guidelines

This e-learning tool is a joint product of UNODC and the UNGC. It uses six interactive learning modules to further the audience's understanding of the UNGC 10th principle against corruption and the United Nations Convention against Corruption as they apply to the private sector. The tool targets private sector actors and can also be useful for students taking the present Module. Each video only lasts about five minutes, providing a quick and effective way of learning about business integrity. Students who complete all six modules will receive a computer-generated certificate, which could be an incentive that increases their interest in the learning tool.

 

Pre-class exercise 2: Case studies

Ask the students to spend one to three hours (depending on the reading assignment) doing research about corruption cases in a specific industry sector (e.g. pharmaceutical, shipping, construction). The lecturer should provide questions to guide students' thinking while reading, such as: Who were the victims in these cases? Which factors do you think led to corruption? What are the negative impacts on the company and on society?

Examples of useful materials are:

Pharmaceutical industry:

Construction industry:

Lecturer guidelines

The research by the students will reveal resources that will be useful as background materials for the in-class exercises and discussions, as well as for the post-class assessment assignments. The lecturer could also provide information regarding corruption scandals that have taken place in the students' country or region.

 

Exercise 1: Is there a difference between public and private corruption?

The lecturer asks students to compare the following case scenarios:

Scenario 1: A Congressman serves on a legislative committee that is choosing the site of a new public building. A company owns property adjacent to one of the sites that the committee is considering. The CEO of the company offers US$20,000 to the Congressman in return for a favourable vote for the site. The Congressman accepts the offer.

Scenario 2: A board member of a private corporation currently serves on a committee that will choose the site of a new office building. Another company owns property adjacent to one of the sites that the committee is considering. The CEO of the other company offers the board member US$20,000 for a favourable vote. The board member of the private corporation accepts.

Lecturer guidelines

The lecturer can facilitate a discussion on, and a comparison between, these two scenarios. The lecturer may, for example, ask: Who are the persons negatively affected in each case? Is one scenario worse than the other? If so, why? Should the conduct in both cases be treated as a crime? How severely, if at all, should the wrongdoers be punished? Does the law in your country criminalize both behaviours? If so, how?

 

Exercise 2: Assessing risks and developing mitigating measures

Divide the class into small groups - a maximum of five students per group encourages participation. Based on the scenarios below, provide each group with a different business setting, for example the biggest local construction group; a multinational pharmaceutical; or a regional shipping company. Ask each group to identify the specific risks in that sector and to discuss appropriate measures to mitigate the risks. The aim of this exercise is to assess the risks to which various business models are exposed, and to think about mitigating measures for each one.

Lecturer guidelines

The lecturer prints out the information provided below about three case scenarios and assigns one scenario to each group. If possible, allow students to briefly review and choose the scenario to be analysed, explaining why that scenario is the most interesting. After each group presents its conclusions, the lecturer facilitates a discussion and integrates contributions by all groups. Students are then given 30 minutes to:

  • identify the risks; and
  • come up with mitigating measures. A member of each group is given the opportunity to share the conclusions with the whole class. Thereafter the lecturer emphasizes how different business models and corporate culture traits lead to different compliance solutions.

The case scenarios provided below may be printed out for the students. The lecturer may wish to consider or develop alternative scenarios that are more relevant to students' regional, local and cultural contexts.

Case scenario for Group 1: XAQUIRI LTD

XAQUIRI LTD is a publicly traded multinational pharmaceutical company. With more than 1,000 employees, XAQUIRI has developed a successful business model in the last 20 years, becoming a leading company in four countries. The board of directors is now discussing the possibility of extending its operations to other countries. A market study prepared by a consultant revealed that multinational pharmaceutical companies do not sell their products directly. Instead, they contract local distributors, which interact with local doctors. All professionals working in the public and private health system prescribe medication based on their professional knowledge and guided by ethical principles. Distributors often offer incentives to those who prescribe their products. Incentives vary from training courses, invitations to conferences, hiring health professionals as consultants and, in some countries, cash payments. Even though distributors are not company employees, corporate liability rules make companies liable for the conduct of all its business partners, locally and overseas.

Imagine that you are a member of XAQUIRI's compliance team. Identify the potential corruption risks and develop measures to mitigate them.

Case scenario for Group 2: KABAKA INC.

KABAKA INC. is a leading construction company with more than 50,000 employees. In the last 30 years, KABAKA INC. was involved in the most important public construction projects in country A. The commercial success was achieved by the business skills of the Kabaka family, whose members founded the company and are the only shareholders and members of the board.

KABAKA INC. has, however, grown in an environment of systemic corruption. A huge and complex cartelization system has ruled the public construction projects in the country for some decades, which has been tolerated and, in some cases, encouraged by the different political parties, in exchange for money and favours. Furthermore, improper payments to labour union leaders represent an important cost in the construction industry. It is publicly known that companies pay up to ten per cent of the cost of each project to the leader of the construction workers' labour union to avoid strikes and meet deadlines.

Encouraged by international conventions and following a regional trend, the recently elected Government of country A has tabled a bill establishing criminal corporate liability for public and commercial bribery. The bill requires companies to have an effective anti-corruption ethics and compliance programme as a requisite to sign public contracts. As a result, KABAKA INC. can only apply for new public tenders once its anti-corruption ethics and compliance programme is up and running.

KABAKA INC. decides to hire you as a consultant to identify the risks and develop measures to mitigate them. Draw up a report for your employer.

Case scenario for Group 3: DIOGENES LTD

DIOGENES LTD is a maritime shipping company based in country B. The recently designated CEO is an experienced businesswoman who has worked in the shipping sector for 20 years. She wants the company to expand to new markets, but also to tackle some longstanding problems.

According to the CEO, it is common practice in many ports of the world for local inspectors to demand favours in return for speeding up the loading and unloading of cargo. This is not a minor issue because time spent by ships in port is expensive for DIOGENES LTD. Local inspectors usually demand all kinds of favours from the captains of ships, which in many cases include small facilitation payments like imported cigarettes, bottles of whisky or cash payments, to speed up the procedures. Different actors take part in the port inspections, such as ship captains, local inspectors and public officials.

DIOGENES LTD also interacts with state-owned and private companies, for example, when buying new ships or contracting maintenance work.

In this scenario, the board agrees with the CEO's plan to try and expand into new markets, but also to try to reduce corruption risks, avoid unnecessary costs for bribes, and adhere to legislation by implementing an effective anti-corruption ethics and compliance programme. Imagine that you are a member of the board of directors during a board meeting. Share your evaluation of the situation and your suggestions about how to proceed.

 

Exercise 3: The consultant

This exercise involves role playing in an imaginary board meeting setting. In small groups, students set about working on a dilemma where they analyse and decide on a risky business opportunity after detecting several red flags. During these discussions, students will be able to experience the inherent tension between risky business opportunities, and ethics and legal compliance. Students will also have to take into account the complexity of transnational business transactions and the implications of third-party due diligence.

Lecturer guidelines

The lecturer should print out the exercise before class and hand a copy to each group of students. Remember: A maximum of five students per group encourages participation. Each group is given 30 minutes to read and discuss the case. After the discussion, the lecturer asks each group to upload or share a brief, written summary of their analysis and decisions, and then invites a representative from each group to present the group's conclusions to the whole class. Before the full-group discussion, the lecturer can ask students to do a confidential vote on whether they would hire the consultant or not.

The lecturer, or a separate group of students, can devise a chart, shared on the board or online, to track the points observed by the groups. After the full-group discussion, the students return to their small groups and discuss their original position and whether and why it has changed. The lecturer may conclude this exercise with discussions about what students think the stronger decision is and why.

The following text should be printed and handed out:

Case Scenario: The consultant

You are members of the board of a multinational construction company headquartered in country C. The company trades its shares at the New York Stock Exchange and is therefore subject to the Foreign Corrupt Practices Act of 1977 (FCPA). Your company was sanctioned for FCPA violations in 2015, but has since implemented strict ethics and compliance measures. Your company is active in many countries. The subsidiary in country D is about to bid for what may be the biggest contract in the region since 2010. The local CEO requests approval from the board to hire a consultant who seems key to winning the contract. The board has just received the following email from the compliance officer responsible for the region:

Dear Board Members

As you know, our local subsidiary is about to bid for the tender of the Ministry of Transport for the construction of a highway in country D. In addition to the construction contract, the winner will operate the highway tolls for ten years. According to a market study, this appears to be a profitable business opportunity extending over many years. At this stage of the bidding process, our company and a joint venture that includes another local company are shortlisted. This morning, our local CEO requested my authorization to hire a consultant that can help us obtain the contract. The consultant is a qualified engineer with significant expertise in the field. The consultant requests a fee of three per cent of the first gross instalment of the contract, on a contingency basis, amounting to about US$1.5 million. The price is at the higher end for global consulting fees and certainly above the average of local fees. The consultant's services consist of representing us at the scheduled public hearing, which will take place this coming Friday. The hearing will be closely covered by the press and we expect the attendance of important stakeholders. The local CEO believes that the consultant can be key to our success. Our local compliance officer has checked the consultant's background against standard databases and found nothing suspicious. There are no pending court cases and, while there were some media articles about the consultant's influence over decision makers in infrastructure contracts, our local CEO explained that all of them come from a newspaper controlled by the opposition party that takes every opportunity available to create suspicions of corruption within the current administration. No concrete evidence has been published.

After the conversation with the local CEO, we are inclined to give approval to hire the consultant. The local CEO shares our view but has also suggested that the consultant might be offering services to the competing joint venture as well. Our company policy requires the approval of the Board for this decision. How should we proceed? We would appreciate your reply as soon as possible.

Best regards,

Compliance Officer X

 

Exercise 4: Anti-corruption ethics and compliance programmes

The following model from the United Nations Global Compact shows six steps to an effective anti-corruption ethics and compliance programme:

Step 1: Commit

Leadership commits to prioritizing the Global Compact principles in strategies and operations and to taking action in support of broader United Nations goals, in a transparent way.

During this step, company leadership publicly signals its commitment to stakeholders. Leadership specifically commits to supporting the Global Compact and making its 10 principles part of the strategy, culture and day-to-day operations of the company, with oversight provided by transparent governance structures.

Step 2: Assess

Leadership undertakes to assess risks, opportunities and impacts across Global Compact issue areas.

Equipped with a commitment to the Global Compact and in support of United Nations goals, the company assesses its risks and opportunities - in financial and extra-financial terms - as well as the impact of its operations and activities, on an ongoing basis in order to develop and refine its goals, strategies and policies.

Step 3: Define

Leadership aims to define goals, strategies and policies.

Based on its assessment of risks, opportunities and impacts, the company develops and refines goals and metrics specific to its operating context, and creates a roadmap to carry out its programme.

Step 4: Implement

Leadership undertakes to implement strategies and policies throughout the company and across the company's value chain.

The company establishes and ensures ongoing adjustments to core processes, engages and educates employees, builds capacity and resources, and works with supply chain partners to address and implement its strategy.

Step 5: Measure

Leadership plans to measure and monitor impacts and progress toward goals.

The company adjusts its performance management systems to capture, analyse, and monitor the performance metrics established in the Assess and Define steps. Progress is monitored against goals, and adjustments are made to improve performance.

Step 6: Communicate

Leadership pledges to communicate progress and strategies, and to engage with stakeholders to strive for continuous improvement.

The company communicates its progress and forward-looking strategies for implementing its commitment by developing a communication on progress, and engages with stakeholders to identify ways to improve performance continuously.

Source: United Nations Global Compact

Ask your students to reflect critically on this model and explain its strengths and weaknesses.

Lecturer guidelines

If the time allows it, the lecturer may split the class into groups and ask each group to identify existing national and international guidelines on anti-corruption ethics and compliance programmes or to assign some of the following examples from Argentina, Brazil, Japan, New Zealand, Spain, United Kingdom, USA or the International Chamber of Commerce. Then, each group should analyse whether these guidelines follow the steps, described by UNGC, and discuss their findings with the rest of the class.

 

Exercise 5: Collective action role play

This exercise is designed so that students express themselves through role playing. The students should be given time to research a selected case study and understand their roles, before they begin to develop the requested documents.

Lecturer guidelines

The lecturer should select a relevant case study and print it out before class. The lecturer may use the Maritime Anti-Corruption Network (MACN) case study described in the Key issues section, which involved several business associations that operate in the maritime transport sector in Argentina, or one of the case studies in this B20 paper from 2014. The lecturer may wish to use or develop alternative case studies that are more relevant to students' regional, local and cultural contexts.

The lecturer should divide the students into small groups, and hand a copy of the case study to each group. Remember: A maximum of five students per group encourages participation. Provide each group with a different role, for instance maritime inspectors, company executives accused of criminal practices, members of a competitor company, customers, government officials. Each group will have 15 minutes to read and prepare the case. After that, the lecturer will ask each group to play a role in the negotiations. The discussions should consider the commercial, legal and financial advantages and disadvantages faced by each stakeholder; how to create a level playing field; and how this would affect different actors. Participants should try hard to reach an agreement, because if all stakeholders agree, the government will reform the regulatory framework.

 
Next: Possible class structure
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