While the coalition is fighting for the long-overdue implementation of the EU-Directive on pay transparency is struggling, the next reform project of the EU-27 is already on the horizon. Instead of closing the wage gap between men and women, this is about the Union-wide fight against corruption. A new anti-corruption directive was recently published in the Official Journal of the EU, setting in motion a staggered implementation period of two or three years. The need for legislative action is smaller than with salary transparency. However, companies should start meeting the requirements of the directive now. Andreas Frohner, partner at the consulting firm EY Austria, emphasizes this in an interview with the “Presse”.
Frohner is a trained lawyer and tax consultant and heads the Forensics and Integrity Services department at EY. He was the chief compliance officer of a division of a German car company and, according to his own statements, the first Austrian to be involved in a major corruption investigation – in 2005. In his opinion, the harmonization of the offenses relating to bribery and bribery by the summer of 2028, which is aimed at with the new directive, requires “no fundamental changes” in Austrian law, but only certain “tightening of definitions” and other adjustments.
In the Association Responsibility Act introduced 20 years ago, for example, which provides for criminal liability of companies for, among other things, corruption under their umbrella, the upper limit of fines must be raised significantly: from the current 5.4 million euros to up to 5% of annual turnover and a maximum of 40 million euros. It is not until the summer of 2029 that the EU states will have to develop national risk analyzes and prevention strategies and have their own anti-corruption authorities, such as Austria already has: the Federal Office for the Prevention and Combating of Corruption. “The authorities are encouraged to cooperate across Europe,” says Frohner.
Not least because of this, the risk of detection in cases with a foreign connection will increase. However, Frohner appeals to all companies to improve internally in prevention, control and processing, which can also help if prohibited behavior occurs despite everything: The existence of a compliance management system can have a mitigating effect on punishment in the worst case – but only if it is “effective and comprehensive and cannot be seen as just ‘eyewash’ that serves ‘cosmetic purposes’,” says Frohner, referring to the verbatim sentence formulated recitals to the directive.
“This should be really alarming for companies,” warns Frohner. In practice, he repeatedly finds that companies have a compliance management system, but it is a “paper tiger”. It is important to document risk assessment, controls and remedial measures. “If it is not documented in the compliance environment, it did not take place.”
What matters is the corporate culture, “the tone from the top,” says Frohner. Managers would have to exemplify the values, react decisively to misconduct in the company and communicate this accordingly. Meanwhile, Frohner is also hoping for a cultural change in public when it comes to post-scheming. “The fact that positions are not awarded based on the best qualifications, but because someone knows someone, can be seen nonchalantly as sloppiness. But that is not acceptable and definitely does not work that way in the European context.”
Tip: Today, June 15th, there will be a legal panorama at the Juridicum from 6 p.m. on the subject of postal fraud.
To person
Andreas Frohner, a trained lawyer and tax consultant, is a partner at the consulting firm EY Austria and heads the forensics and integrity services department there.
