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Business Ethics

We view business ethics as fundamental to successful business practices. Operating ethically means, at a minimum, conducting our affairs in accordance with the letter and spirit of the applicable laws of the countries in which we do business.

Our Code of Business Ethics defines our commitment to legal and ethical conduct, the environment and human rights. Our Code of Conduct spells out the policies and procedures that govern our behaviour.

As a member state of the Organization for Economic Co-operation and Development (OECD), Canada is a signatory to the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions and passed the Corruption of Foreign Public Officials Act, which guides us. We are also a member of the OECD Working Party on Export Credits and Credit Guarantees, and are bound by the OECD Council Recommendation on Bribery and Officially Supported Export Credits.

We are also guided by certain agreements governing international trade including Guidelines for Multinational Enterprises, Extractive Industries Transparency Initiative, the World Trade Organization’s Countervail Measures Agreement and the Voluntary Principles on Security and Human Rights.

Anti-Corruption Program

Our Anti-Corruption Program, developed in response to the OECD Convention, consists of processes and documentary safeguards including the requirement for applicants for our support to sign an anti-corruption declaration and/or representations and covenants. We also send an Anti-Corruption Brochure to all customers, which explains the challenges of avoiding corruption in international trade and suggests actions companies might take to protect themselves.

Anti-corruption FAQs

1. Why do you now require our company to sign a declaration denying corruption in EDC supported business transactions?

The corruption of foreign public officials was made an indictable offence on February 14, 1999 under Canada’s Corruption of Foreign Public Officials Act. Consequently, we must take steps to ensure that it is not supporting criminal acts by supporting export transactions that involve corruption of foreign public officials.

We will rely on due diligence and on the anti-corruption declarations provided by its clients as assurance in this regard. In taking these steps, we will also be serving the interests of its clients by alerting them to the new criminal law.

Our Code of Business Ethics states that we shall take measures to avoid supporting corrupt transactions. Further, Canada and EDC have undertaken to support the anti-corruption commitments made by the Export Credits and Credit Guarantees Working Group members of the Organization for Economic Cooperation and Development (OECD). This agreement is found in the November 2000, Action Statement On Bribery and Officially Supported Export Credits (see related websites section). The agencies and countries involved are committed to seek anti-corruption declarations as one of the measures against corruption.

2. The declaration states that my company has not been and will not knowingly be party to a violation of the Corruption of Foreign Public Officials Act. What does this law say and how am I affected?

In essence, the new Canadian law criminalizes international bribery and associated practices including things such as conspiracy, aiding and abetting, and counseling others to provide a bribe.by creating three separate criminal offences: the bribery of foreign public officials, the possession of the proceeds of such bribery and the laundering of those proceeds.

Offences may result in imprisonment and/or fines.

3. I have never been involved in corruption and take exception to signing the declaration. Why should I? What will happen if I refuse?

We are confident that, for the vast majority of its clients, the anti-corruption declaration will not pose any problem. However, all clients will be asked to sign it because, as stated in (1) export credit agencies, including EDC, have undertaken to the OECD to obtain anti-corruption declarations from all exporters and/or applicants for their export support. As a public institution of Canada, we require this declaration from our clients. We will rely on our customer's anti-corruption declaration as one of the indications that no corruption is associated with transactions that EDC will be supporting.

We do not suggest or imply that our clients may be involved in prohibited activities. We assume that all our clients are conducting their affairs in a lawful and law-abiding manner, but is simply asking the persons who know best about these affairs to confirm the accuracy of that assumption.

Although we will respect a decision not to sign the declaration, we may not be able to proceed with the transaction and may no longer be able to provide insurance coverage.

4. What will happen if I sign the declaration while knowingly being involved in corruption? What if I am involved in corruption without my knowledge?

EDC will rely on the truthfulness of the anti-corruption declarations furnished by its customers both in the protection of its employees and of its own interests. We will also have the right to withdraw from a contract and refuse the claims thereunder, if we determine that corruption, as defined under the Corruption of Foreign Public Officials Act, is associated with the transaction. We will not tolerate a party knowingly delivering a false anti-corruption declaration, and would, in such an unlikely circumstance, consider all of our options. If you have any questions about the implications of engaging in such conduct you should consult your legal counsel. If the declaration was furnished without your knowledge of corruption, there should be no liability unless there has been "willful blindness" on your part. In other words, willful ignorance of the corruption (i.e.: ‘head in the sand’) may still attract criminal responsibility. We strongly recommend that you raise such complicated issues with you legal counsel, because we cannot provide legal advice to you.

5. How can EDC and the Canadian government expect me to carry on business internationally in competition with companies that are willing to pay bribes?

First, the payment of bribes, and the possession of property obtained by bribery and the laundering of these proceeds have been made criminal offences in Canada by the Canadian Parliament. We would draw to your attention that the Department of Justice’s guide The Corruption of Foreign Public Officials Act states: "The five-year maximum term of imprisonment for the offence of bribing a public official ensures that this is an extraditable offence... The amount of any fine would be at the discretion of the judge, and there is no maximum... The penalty is comparable to the maximum penalty for domestic bribery in... the Criminal Code." Bribing of foreign public officials is no longer a matter of business expediency or convenience or judgment. It is a criminal offence. The consequences of bribing can be disastrous both to you as an individual and to your business. And, as explained above, we cannot be associated with such activity.

Second, the international view of bribery is changing. The attitude towards bribery is moving from acceptance and tolerance to abhorrence and prohibition. The firm anti-corruption position of the World Bank and the many global anti-corruption initiatives of other world bodies are increasingly exposing the practice of bribery in an effort to control it. The 29 OECD countries have committed themselves to criminalizing the bribery of foreign public officials in their domestic laws by signing the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, in Paris on December 17, 1997. The OECD is following up on this binding commitment and how it is being implemented by each country. Canada is among the many OECD countries that have already amended their domestic laws to conform with the Convention, and that is the substance of the new Canadian statute, the Corruption of Foreign Public Officials Act.

Third, many countries have entered into mutual information and assistance agreements such as the Mutual Legal Assistance in Criminal Matters Act, that oblige police forces in each participating country to investigate allegations of bribery brought to them by other countries. Disappointed business competitors, having lost the bidding for an international contract because of bribery, may turn to their domestic police force to initiate an investigation in the country of the alleged bribe payer if that country (like Canada) has passed anti-bribery laws.

6. The declaration states that my company has not been ‘party’ to any action prohibited by the Corruption of Foreign Public Officials Act. Can the activities of my agents expose my company to liability under this Canadian law?

The declaration is intended to catch any knowing involvement in corruption (as defined), whether committed directly by your company (or its employees) or indirectly through an agent.

Typically, the activities of an agent may expose the principal (in this case, your company) to liability. The agent's actions may be or be deemed to be those of the principal and for which the principal must bear full responsibility, depending on many factors. Literature is available describing the safeguards that companies should use in retaining agents. These safeguards relate to the selection of the agent, the reputation and qualifications of the agent, the language of the retainer, as well as the quantum of and the method and other arrangements for payment. (See related websites section for website addresses.) The responsibilities and liabilities of a principal for the acts of its agent are no different with regard to the new anti-corruption law than they are with regard to other matters.

7. My company is extremely concerned about not violating anti-corruption laws. How can we distance ourselves from potential corruption in transactions?

There are a number of indicators of potential corruption. These red flags should alert you to further investigate. You can also implement various anti-corruption measures. Following are just a few common sense suggestions - the list is by no means exhaustive:

  • Does your agent / counter-party / supplier have a good reputation? A discrete inquiry by your local lawyer or agent may save a great deal of difficulty.
  • Is the jurisdiction in which you operate known for corruption? Transparency International’s Index is a well-known indicator. You may wish to speak with the Canadian Embassy. Make sure your strategy for dealing with requests for bribes - a firm "no" - is determined well in advance.
  • Do the business numbers ‘make sense’? Any unexplained payments or numbers that do not add up or are not ‘businesslike’ may be indications of irregularity.
  • Have you clearly said "no"? Failure to say "no" can lead to the misunderstanding that your company might consider loans, rewards, or benefits of other kinds for a foreign official.
  • Are others informed about your anti-corruption policy? You should clearly inform agents and all employees, especially those working outside Canada, of your company’s unwavering anti-corruption policy and require them to refer troublesome situations to your head office for direction.

8. What should I do if I discover that my company is involved in corrupt practices for transactions supported by EDC?

We believe that you should act as you would for any other criminal offence. We recommend that you obtain legal advice on the matter. Remember that criminal offences may be attributed to persons who may have no direct role in carrying out the offence. Examples of such offences are conspiracy, counseling, aiding and abetting, etc.

Combatting Bribery and Corruption

Read EDC's Approach on Combatting Bribery and Corruption in International Business Transactions.

December 9th is International Anti-corruption Day

Corruption is a serious crime that can undermine social and economic development in all societies.

International Anti-corruption Day is part of a global campaign to raise awareness of the need to combat corruption.

We invite you to familiarize yourself with the risks of corruption and bribery in international business transactions. Would you like to take the quiz? Watch a video to learn about the risks. Are you a small business struggling with these issues?

Responsible Business

Business Against Corruption: case stories and examples (PDF)
UN Global Compact Office

Combatting Corruption in International Business (PDF)
An article which was featured on ExportWise.ca.

Corporate responsibility and anti-corruption
International Chamber of Commerce

Corruption Perceptions Index
Transparency International - Corruption Perceptions Index 2013 Results

Financial Crime in International Trade
A guide for small and medium-sized importers and exporters on how to manage the risks of financial crime in international trade.

Good Practice Guidance on Internal Controls, Ethics and Compliance
Organization for Economic Co-operation and Development (OECD)

TRACE International Inc.
A Washington, DC-based consultancy who advises firms on corruption risks, etc.

Human Rights

We value and promote the protection of internationally recognized human rights, consistent with the policies of the Government of Canada. Our screening mechanisms, pre-signing due diligence and ongoing project monitoring help ensure that Canadian companies conduct their international operations to universally acceptable standards.

EDC Statement on Human Rights

EDC values human rights and provides its financing and insurance services with a view to the promotion and protection of internationally-recognized human rights. Investment projects may have potentially significant impacts on the human rights of individuals. EDC recognizes that financial institutions must endeavour to assess the potential for adverse human rights outcomes for individuals directly affected by such projects.

Valuing and Promoting the Protection of Human Rights

EDC is a wholly-owned arm of the Government of Canada that operates in a manner consistent with the Canadian government’s policies. EDC receives public policy guidance from the Government of Canada with respect to Canada's international obligations, such as those elaborated in the United Nations' Universal Declaration of Human Rights. Further to a memorandum of understanding signed in 2002, the Government shares intelligence with EDC on the human rights situation for a wide range of countries.

Recognizing Factors that Impact Human Rights

EDC's Political Risk Assessment Department routinely conducts country- and project-level political risk assessments that include an analysis of factors that influence human rights conditions in host countries. An additional layer of due diligence will be undertaken for investment projects and countries assessed to have a higher potential for human rights issues. This supplementary analysis may include an examination of factors such as the country's socio-economic dynamics, history of conflict and site-specific issues such as security, location and relations with local communities. These assessments take into account a range of external indicators including the World Bank's Country Governance Indicators, Minority at Risk data, Freedom House's Freedom of the Press and Civil Liberties ratings and conflict data from the University of Maryland's Center for Development and Conflict Management, among others.

Identifying Best Practices for Financial Institutions

EDC recognises the evolutionary nature of corporate social responsibility (CSR) practices, and actively monitors the international discussion of human rights issues. EDC also draws on the collective experience of the distinguished Canadians who comprise its Advisory Council on CSR. In terms of the field of assessment of potential human rights impacts, EDC is committed to working with the Government of Canada and other stakeholders to identify emerging best practices and to incorporate into its due diligence those practices that are relevant to the mandate of a financial institution.


2015 CSR Annual Report

Corporate Social Responsibility Annual Report

Taking Responsibility. Read more in our Corporate Social Responsibility Annual Report.

Keep Corruption Out quiz

Keeping Corruption Out

How much do you know about your risks of breaking the law?

We encourage our customers to take our Keep Corruption Out quiz.