Corruption misallocates resources, reinforces poverty, undermines the integrity of government and community decision-making and wastes opportunities that arise from resource development. We are committed to contributing to the global fight against corruption and working with business, government and civil society to support this effort.
Our commitment to anti-corruption compliance is embodied in Our Charter and Our Code. We have a specific anti-corruption procedure that sets out mandatory requirements to identify and manage the risk of anti-corruption laws being breached. Our anti-corruption processes require review or approval by our Ethics & Compliance function of activities that potentially involve higher risks of exposure to corruption. We prohibit authorising, offering, giving or promising anything of value directly or indirectly to a government official to influence official action, or to anyone to encourage them to perform their work disloyally or otherwise improperly. We also prohibit facilitation payments, which are payments to government officials for routine government actions. We require our people to take care that third parties acting on our behalf do not violate anti-corruption laws. A risk-based system is used to assess business partners and determine due diligence and other compliance requirements prior to approval. The Our Requirements for Supply standard also specifically sets out our compliance requirements in relation to (amongst other things) corruption, bribery and extortion for suppliers to BHP. A breach of our requirements and expectations can result in disciplinary action, including dismissal or termination of contractual relationships.
Our Ethics & Compliance function, led by the Chief Compliance Officer, has a mandate to design and govern BHP’s compliance frameworks for key compliance risks, including anti-bribery and corruption. The function is independent of our assets and regions, and comprises teams that are co-located in our main global locations and a specialised Ethics & Compliance Legal team. The Chief Compliance Officer maintains an independent reporting line to the Chief External Affairs Officer and has direct access to the Risk and Audit Committee. The Chief Compliance Officer previously provided a report twice a year to the Risk and Audit Committee on ethics and compliance issues. Since March 2020, the Chief Compliance Officer reports quarterly to the Risk and Audit Committee and meets separately with the Committee Chair.
Our anti-corruption compliance program is designed to meet the requirements of the US Foreign Corrupt Practices Act 1977, the UK Bribery Act 2010, the Australian Criminal Code Act 1995 (Cth) and applicable laws of all places where we do business. These laws are consistent with the standards of the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. Our anti-corruption compliance program is also consistent with Transparency International’s Business Principles for Countering Bribery. We recognise the importance of ongoing efforts to strengthen global anti-corruption laws and actively contribute to public dialogue in this area, including through our public submissions and other advocacy supporting appropriate and effective law reform in this area.
Our compliance program includes mandatory processes designed to manage corruption risks across our business, with particular focus on those areas assessed as having exposure to high levels of risk, including activities relating to seeking and renewing tenements, licences, permits and other government approvals; government negotiations; and shipping and port dealings. Risk-weighted process controls require Ethics and Compliance review and endorsement for our highest risk transactions, including gifts and hospitality, community projects and sponsorships and the engagement of third parties in circumstances assessed as presenting higher levels of corruption risk.
Anti-corruption risk assessments form a critical part of our program, helping to ensure that appropriate resources are focused on the highest areas of risk and that an adequate set of critical controls has been adopted to manage the exposures. Anti-corruption risk assessments follow BHP’s standard risk assessment process, including a process for identifying and testing the effectiveness of critical controls which manage corruption risk. All operated assets and functions within BHP are required to conduct periodic anti-corruption risk assessments, and to re-assess these risks if the risk environment changes.
The Ethics & Compliance function conducts monitoring of financial and other data (including, for example, information from due diligence activities) to check higher risk transactions and verify the operation of key anti-corruption controls, such as the requirement to obtain pre-approval before engaging in higher corruption-risk transactions. A separate, independent Internal Audit and Advisory team also conducts anti-corruption audits to assess implementation of anti-corruption controls and to identify transactions and conduct that are not consistent with BHP’s policies, standards and procedures.
Our anti-corruption compliance program firmly encourages and supports employees, contractors and other third parties to report suspected corruption issues. Reports can be made a number of ways, including through our global confidential whistleblower hotline, EthicsPoint. Our Ethics & Compliance Legal team manages investigations into potential ant-corruption issues, whether these are reported directly into EthicsPoint or via other channels. Any retaliation against someone who speaks up and reports an issue is prohibited by Our Code. Our BHP Whistleblower Policy sets out additional information, including protections available to persons who make eligible disclosures under Australian law.
The Ethics & Compliance team reviews the design of our anti-corruption compliance program to make any changes required by regulatory developments. Ethics and Compliance also uses the results of monitoring, audits and investigations to make appropriate enhancements to our program. Enhancements may also be based on key observations from the outcomes of public legal cases involving allegations of breaches of anti-corruption laws, and external benchmarking activities. Our compliance program is reviewed by external counsel, at least every five years. We believe that regular calibration of our program enables us to ensure optimal resource allocation to areas presenting the highest corruption risks to our business.
We require annual training for all employees on Our Code which, as noted above, prohibits all forms of bribery and corruption. As part of this training, employees are required to confirm that they will act according to Our Code, and that they will seek clarification (including from the Ethics & Compliance team) if they do not understand any part of Our Code. In addition to anti-corruption training as part of annual training on Our Code, additional risk-based anti-corruption training was completed by 3,244 employees and contractors in FY2020, as well as employees of business partners and community partners. In recognition of the impacts on our workforce of COVID-19 disruptions, the end of the time period for relevant employees to complete the additional risk-based anti-corruption training was extended from 30 June 2020 to 31 August 2020.
More information on our anti-corruption compliance is available online at bhp.com/anticorruption.