Corruption Prevention

Before we launch activities in a new country, we perform a thorough analysis of business ethics and sanction law issues in that country. The Business Ethics Entry Assessment includes an analysis of the Corruption Perception Index assigned by Transparency International to a given country. Based on the outcome of the assessment, corporate governance in local operations is adapted to assure compliance with OMV’s ethical standards.

OMV has implemented a process for screening both potential new and existing business partners using EU and US sanction lists. In addition to those sanction checks, more exhaustive due diligence assessments are conducted prior to the engagement with a business partner or during the business relationship as needed.

Critically, counterparties in M&A transactions, strategic partnerships, or business partners that have been in the media spotlight in the context of criminal conduct are assessed in greater depth. Such an assessment involves the potential business partner, its direct and indirect shareholders, other investors, and the ultimate beneficiaries of directly or indirectly involved legal entities. To that end, OMV requests that counterparties provide information focused on corruption, money laundering, other criminal conduct, and related sanctions as per OMV’s standardized know-your-customer (KYC) questionnaire.

Key red flags are connections to government officials, other individuals, and companies referred to in high-attention media reports related to political and corruption cases, sanctioned entities, or any other suspected involvement in criminal conduct. In cases where intermediaries, lobbyists, or consultants are engaged, we use a third-party service provider to do comprehensive research, including field research. Furthermore, supplier assessments conducted by the OMV Procurement department include a compliance analysis.

In 2020, our Internal Audit department carried out
14 internal compliance audits across the full range of business ethics issues (thereof 10 at OMV and 4 at OMV Petrom). Risk-related audits covering fraud and corruption issues form an integral part of the Corporate Internal Audit. Additional preventive measures were set up for OMV Petrom, such as third-party background checks of OMV Petrom’s business partners. Besides raising employee awareness through training, we have established channels to help identify ethical misconduct at an early stage. Timely notification is crucial for taking precautionary measures directed at avoiding or mitigating major financial loss or reputational harm. If an employee observes or becomes aware of potential or actual misconduct or violation of internal rules or statutory regulations, whether committed by other employees or by a business partner, that employee is encouraged to speak up and report the incident.

Besides employees, other stakeholders also represent a valuable source of information, which can help identify breaches of ethical standards. To this end, the OMV Group has introduced a whistleblower mechanism – the Integrity Platform. Anyone can access it online (omv-group.integrityplatform.org) and report an issue relating to corruption, bribes, conflicts of interest, antitrust law, or capital markets law. The report can be filed anonymously, if desired. Special protection is given to employees in their capacity as whistleblowers. Acting as a whistleblower does not bring any adverse consequences. The report will be analyzed and an answer provided through the same platform within ten days. Identified violations of ethical standards will be handled further by the Whistleblowing Committee, which includes members of senior management.

Zero incidents of corruption; zero incidents when contracts with business partners or employees were terminated or not renewed due to violations related to corruption

Zero public legal cases involving corruption brought against the organization or its employees during the reporting period

One ¹ On October 6, 2020, the Polish Competition Authority UOKiK issued a decision with respect to OMV’s financing of the Nord Stream 2 natural gas pipeline. In this decision, UOKiK concluded that this financing arrangement breaches Polish merger control rules and imposed a fine of EUR 19.571 mn against OMV. OMV does not share the legal analysis of this decision and is appealing against it. legal action pending or completed during the reporting period regarding anti-corruption activities and violations of antitrust and monopoly legislation in which the organization has been identified as a participant

SDG target: 16.5 Substantially reduce corruption and bribery in all their forms