Transparency and anti-corruption are cornerstones of good governance and a productive business environment, on which effective markets and sustainable development depend.
In such environments, the benefits from our industry will also be more readily shared with society as a whole.
Transparency and anti-corruption are important principles to which we are committed and on which we will not compromise. In the merger process, a decision was made by Chief Executive Helge Lund in consultation with the Statoil board to submit Hydro's operations in Libya for external review (see box). No other incidents were uncovered in 2007.
Our commitment to transparency and anti-corruption is solidly grounded in a number of international initiatives, including the OECD Guidelines for Multinational Enterprises and the United Nations tenth Global Compact principle on anti-corruption.
We have also endorsed the Extractive Industries Transparency Initiative (EITI), and we were the first major oil company to start disclosing all revenues and payments in the countries in which we operate. We are also an active participant - through the World Economic Forum's Partnering Against Corruption Initiative (PACI) - in efforts to align the work of major international anti-corruption initiatives (Global Compact, International Chamber of Commerce and Transparency International) in order to enhance their overall impact.
Through a corporate agreement, we also support the work of Transparency International Norway, with whom we collaborated on the development of the Business Principles for Countering Bribery (BPCP).
In addition, we aim to work with industry and partners from the business community to operationalise our commitment in the countries where we operate (read about how we address these challenges in Brazil and Nigeria and elsewhere, respectively.
We promote transparency and the fight against corruption through engaging in regular stakeholder dialogues, respecting national and international laws, integrity due diligence procedures, rigorous training of staff in business ethics and anti-corruption, and by publishing our revenues and investments as well as the taxes we pay in the countries where we operate.
In 2007, five of six business areas reviewed their corruption risks as part of their overall assessment of risk exposure. We also updated our internal policies and procedures, including the Ethics Code of Conduct, which sets out clear requirements for business practices and personal conduct - including relations with suppliers, partners and customers, the use of lobbyists, conflicts of interest and gifts, and hospitality and expenses.
Our procedures for integrity due diligence were also revised to improve our screening of investments and suppliers for integrity and human rights violations.
A compulsory ethics and anti-corruption course was also launched. It was completed by as many as 95 per cent of full-time Statoil staff.
In addition 1,151 executives from Hydro's oil and energy division have previously completed the Hydro Integrity Programme, which includes training modules on anti-corruption. StatoilHydro's ethics and anti-corruption course will be updated to reflect revised governing documents, and especially the new Ethics Code of Conduct. The remainder of the company's employees are expected to receive such training in 2008. The course will also be offered to small and medium-sized companies, including potential suppliers, in Norway.
Statoil was informed on 26 September 2007 about possible consultancy agreements and transactions relating to Hydro's operations in Libya, which on 1 October 2007 were transferred to StatoilHydro as part of the merger between Statoil and Hydro's petroleum business.
Following a preliminary assessment by Statoil's corporate audit function, chief executive Helge Lund resolved, in consultation with the Statoil board, to initiate an external review of relevant aspects of the matter. The US law firm Sidley Austin LLP is in the process of carrying out the review together with the Norwegian law firm Simonsen Advokatfirma DA, supported by StatoilHydro's corporate audit function.
Other consultancy agreements relating to Hydro's international petroleum operations are also under review. Hydro and StatoilHydro are cooperating to secure the documentation and information required to establish the facts of the matter.
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