Corruption

The fight against corruption is one of the top global challenges. In fact, corruption is a major obstacle to sustainable development and has a considerable impact on the poorer communities in particular: it impedes economic growth, distorts competition between companies, presents serious legal and reputational risks for companies, and represents a huge cost.
Not only governments, but companies too can contribute to a more transparent global economy, by undertaking to eliminate all forms of corruption, develop incisive policies and practical anti-corruption programmes.

The Generali Group plays an active role in the fight against corruption: as a UN Global Compact member, it undertakes to share, support and apply principle 10 concerning the fight against corruption, in its spheres of influence; in addition, it asks all its stakeholders to engage in ethical conduct to counter corruption and adopts suitable measures to prevent conduct that is not in keeping with the principles of correctness, legality and transparency.

Ensuring respect for the provisions governing corruption is a strategic objective for the Group. For this reason, as stated in the Charter of Sustainability Commitments, the Group undertakes, in the short-term, to insert the periodic risk assessment of its business activities in the compliance plans.

Almost all countries in which the Group operates have legislation that prohibits corruption by public and private entities and are required to comply with said legislation, on pain of penal and/or civil sanctions. However, the Group has expressly reaffirmed its rejection of all forms of corruption, including the payment of bribes and extortion, in the new Code of Conduct and has provided the proper Group Rules on the matter.

In particular, in carrying out their duties, employees and third parties who operate on behalf of the Group (agents, suppliers, consultants, etc.) are required to act ethically and avoid offering to or accepting from public officials or business partners (or their relatives or business partners) unlawful payments, gifts, forms of entertainment or other inappropriate benefits. The obligation to abstain from this conduct applies without exception in the case of unlawful payments, such as bribes, payoffs or facilitating payments which aim to speed up or facilitate the execution of routine operations.
By contrast, gifts, forms of entertainment or other benefits are not considered improper and may be offered or received only when of a small value, are suited to the circumstances, concern working activities, are permitted under local legislation and conform to the commercial practice in use.

Any exception must be authorised on a case-by-case basis by the local compliance officer.

Anyone that gains knowledge of gifts, invitations or other benefits that are suspected of wrongfully influencing company decisions is required to inform their manager or the compliance department.

The Group does not endorse any event or initiative essentially or exclusively of a political nature, refrains from exercising direct or indirect pressure on political representatives and does not make any contributions to trade union associations in order to apply political pressure.

Aware of the fact that charity and sponsorship contributions may be used for corrupt purposes, the Group requires specific preventive checks to be conducted on the beneficiaries and provides instructions on how to make payments.

Acquisitions and mergers may also run the risk of corruption. Therefore, the Group requires due diligence to be performed in advance, to identify any instances of corruption, considering a reasonable period of time prior to the date the corrupt act was carried out.

The Generali Group is committed to fighting corruption through a series of actions.

Companies are obliged to adopt and periodically review the appropriate internal means of control, compliance programmes and measures aimed at preventing and identifying corruption, developed in accordance with a risk-based approach. Hence, for this reason, companies are required to put in place procedures for the evaluation of risks that are consistent with not only their size and structure, but their nature, scope and place of business.
Companies must adopt financial and accounting procedures that ensure than books, records and accounts are kept in the correct manner and are not used to engage in corruption or conceal acts of corruption.
Lastly, raising awareness and training is no less important, which is described later in the section.

The Code of Conduct and its Group Rules also provide additional indications on how healthy relations must be maintained with business partners. In particular, employees are required to ensure that relations are documented by written agreements which make reference to the Group's anti-corruption policy. Payments made to business partners must comply with market conditions and must not be made to ciphered or numbered accounts.

The Code of Conduct and its Group Rules also deal with conflicts of interests, a situation which is generally avoided and, where this is not possible, is managed in such a way as to avoid prejudice to the Group, and refer to the Related Party Transaction Procedures in cases where the counterparty in a transaction is a related party of the Parent Company.
Details on this document are available in the section Policies and management tools of this chapter.

Fraud, money laundering and terrorism financing are typical examples of corruption that may occur in the insurance and financial industry and which might damage organisations' reputation.
Hence, the Group companies have adopted specific policies, detailed in the section Policies and management tools in this chapter, and put in place an effective system for counteracting the aforementioned practices.

It should be noted that, in Italy, in 2012, a project was launched with the objective of becoming an organisation that permits a proactive approach to fighting fraud, based on more integrated and quicker communication between the various companies involved, an improvement in the culture of combating fraud, through information/training exercises for all employees, and a dedicated website.
A new anti-fraud IT system is at the implementation phase, a deterministic and predictive analysis tool for identifying anomalous and potentially fraudulent positions, to support the process of counteracting and preventing fraud. In particular, the use of predictive models makes it possible to identify examples of fraud, generated by synthesising the typical traits of similar instances of fraud. This new type of analysis will supplement the current deterministic method already available in claims, car and accident systems, extending the anti-fraud analysis to the life segment, to the non-life lines of business still not covered and to the production networks, according to a single paradigm.

The measures which must be adopted by Generali Group companies to prevent instances of money laundering and terrorism financing include: performance of customer due diligence according to a precise framework, the obligation to keep a log of the data obtained from the aforementioned due diligence, identification of suspicious customers and/ or transactions on the basis of risk indicators defined and reporting of these to the local Financial Information Unit.
Companies are also obliged to have the necessary controls and tools in place for effective and efficient risk management.
These must be consistent with their characteristics, size, organisational structure, subject responsibility, products and market conditions.
Finally, companies are requested to send a detailed report on money laundering and terrorism financing to the Head Office department responsible at least once per year, and to promptly notify said department if any events should occur that could expose the Group to high reputational risk.

In the second half of 2012, a questionnaire was circulated, prepared on the basis of specific matters (governance, customer due diligence, conservation and archiving of data, fight against international terrorism and training), with the objective of monitoring all Group companies in terms of anti-money laundering aspects.

With a view to constant improvement, the Generali Group intends to develop its policies further, by issuing a global embargo management policy, technical instructions on both the periodic control of information relating to customer due diligence, and on politically exposed persons, as well as operating guidelines for the management of potentially suspicious transactions that may indicate money laundering and on procedures of onboarding of given categories of customers. Other objectives concern the preparation of a rigorous system for the monitoring of methods of domestic payments and the adoption of a standard Group tool for the management of prejudicial information concerning actual or potential customers.

Training is an important component of risk management, as it creates internal awareness and the skills needed to prevent cases of corruption.

Therefore, the Generali Group offers adequate and continuous training to its employees who might more readily come into contact with the most significant examples of corruption for the sector, such as fraud, money laundering and terrorism financing, and, if deemed necessary, its agents and their collaborators. The goal is to provide them with the necessary tools to identify and manage activities potentially connected with the aforementioned forms of corruption.

Training is carried out through specific meetings and courses given, predominantly via the e-learning method. E-learning is the chosen method, for example, for disseminating the contents and principles of the Organisation and Management Model to all employees and agents of Italian Group companies, and for providing training on money laundering and terrorism financing to the employees of Italian Group companies that are obliged to comply with the legislation, agents and their collaborators.

Awareness of corruption is created through the explanatory notes and concrete suggestions in the new Code of Conduct and in its Group Rules. Training programmes will be provided to all employees in the near future on the Code of Conduct and the Group Rules, and ad hoc training initiatives, focused on compliance programmes for the prevention and identification of instances of corruption, will be provided to employees considered at risk of encountering corruption.

Various Generali Group companies participate in activities on the subject of corruption proposed by local insurance and banking associations.

The above actions make it possible to mitigate the risk of corruption and reduce the number of instances of corruption. In this regard, in 2012, no reports of unethical conduct were received through the appropriate communication channels established. However, a limited number of instances of fraud committed by employees or business partners of Group companies were otherwise detected and managed. The actions taken in response were mainly dismissal, the adoption of disciplinary measures and the termination of contracts, depending on the interested party (employee/business partner) and the gravity of the offence.