PREVENTING CORRUPTIONICAC’S STRATEGIES AND MEASURES
Joseph Lee Yat-Sau∗

INTRODUCTION
Since its inception in 1974, the Independent Commission Against
Corruption (ICAC) of Hong Kong has been adopting a three-pronged strategy
comprising law enforcement, prevention and education to combat corruption.

Inview of the ICAC’s success, this strategy has been adopted by anti-corruption
agencies around the world.

This paper takes a closer look at the ICAC’s corruption prevention strategy,
including its organisational setup to implement the strategy, ongoing and recent
initiatives and measures to prevent corruption in Hong Kong, and some case studies.

I.

THE ORGANISATION AND STRATEGY OF ICAC
(WITH FOCUS ON PREVENTION)

A. The Three-pronged Strategy
1. The Three-pronged Strategy and Statutory Duties of the ICAC
Since its inception in 1974, the Independent Commission Against Corruption(ICAC) of Hong Kong has been adopting a three-pronged strategy comprising law
enforcement, prevention and education (Figure 1) to combat corruption:(i)

Law enforcement – investigate and prosecute corruption offences;∗

Independent Commission against Corruption, Hong Kong Special Administrative Region of thePeople’s Republic of China.

- 34 -

(ii) Prevention – prevent corruption through securing the adopting of systemsafeguards and internal controls in organisations;(iii) Education – educate the community against corruption and enlist their support infighting corruption.1

Enforcement

Corruption
Prevention

Education

Figure 1 – ICAC’s Three-pronged Strategy
This three-pronged strategy is in fact built-in to the ICAC Ordinance (Cap. 204,
Laws of Hong Kong), set out as the Duties of the Commissioner of the ICAC under
Section 12 of the ordinance (Appendix A).
2. A Closer Look at How the Strategy Works
Today, the concept of the “fraud triangle”2 (corruption can be regarded as a typeof employee fraud) is widely adopted in the auditing and fraud prevention professions.
The concept suggests that three conditions are conducive to the occurrence of fraud:(i)

Incentive/Pressure, leading to a motive to commit fraud;1

It is understood that some other jurisdictions regard education as part of prevention, but in the ICAC
of Hong Kong the two are distinguished with the latter focusing on system controls.
2
Statement on Auditing Standards No. 99: Consideration of Fraud in a Financial Statement Audit
issued by the Auditing Standards Board of the American Institute of Certified Public Accountants(AICPA) in October 2002.

- 35 -

(ii) Opportunity in the system or environment for fraud to be committed (e.g. lack ofcontrol);(iii) Attitude/Rationalisation of/by the perpetrator that makes/allows him/her toself-justify his/her commitment of the fraud.
A closer look at how the Three-pronged Strategy works shows that it reduces thethree conditions in the “fraud triangle” (Figure 2).

Figure 2.

How the Three-pronged Strategy Works

Figure 3 provides a view of how the Three-pronged Strategy works to reduce thethree conditions in the “fraud triangle” and enhances the counter-measures:(i)

System Approach –Through regular system reviews (or corruption prevention audits), corruption

risks and system loopholes conducive to corrupt practices are identified, followed by- 36 -

strengthening of controls and improvements to business processes.

The

controls/improvements remove or reduce opportunities for corruption in thesystem/environment.

One type of control particularly highlighted is transparency,

which facilitates external monitoring by customers, business partners, the public, etc.
Internal detective controls and external monitoring facilitates the detection ofcorruption, leading to prosecution.

Post-mortem of corruption that has occurredassists the system reviews to further enhance the controls if necessary.
(ii) Human Approach –Public education against corruption as well as each organisation’s own integrity
management programme (Code of Conduct, integrity training, etc.) help to reduce
employees’ incentives to commit bribery, modify their attitudes and reduce theirrationalisation of fraudulent behaviour.

Public education also reduces the public’s

tolerance to corrupt behaviour and encourages them to report any corrupt behaviour
observed, while an organisation’s integrity management programme can encourage
whistle-blowing.

These facilitate the detection of corruption.

(iii) Law Enforcement –Detection and prosecution provides a strong deterrent against corruption, helping
to reduce incentives to commit bribery and modify attitude/rationalisation.
Enforcement also serves a public education purpose, educating the public about what
corruption is, the consequence of corrupt behaviour, and effectiveness of our law
enforcement thereby encouraging people to report corruption.

Analysis of the modesof corruption and system weaknesses in detected cases also helps us design more
effective preventive measures.

B. Organisation of the ICAC
1. Independence- 37 -

The ICAC’s “independence” is one of its key success factors.

Before theestablishment of the ICAC in 1974, enforcement against corruption was the
responsibility of an anti-bribery unit in then Royal Hong Kong Police Force, which
proved to be ineffective as the Police Force was then one of the most corrupt
government departments.

It was decided that an independent anti-corruption agency

had to be set up, reporting directly to the then Governor of Hong Kong, independent
from any other government organisations and officials including the then Chief
Secretary who was the head of the administration.

This led to the formation of theICAC, which now reports directly to the Chief Executive of the Hong Kong Special
Administration Region (HKSAR).
2. Organisational Structure
The ICAC is headed by the Commissioner of ICAC.

Its organisation isdesigned according to the Three-pronged Strategy, with one distinct Department
responsible for each of the three approaches, plus an Administration Branch to deal
with general administration:(i)

Operations Department – responsible for the law enforcement strategy and duties
set out in ICAC Ordinance Section 12 (a) to (c).

(ii) Corruption Prevention Department (CPD) – responsible for the prevention
strategy and duties set out in ICAC Ordinance Section 12 (d) to (f).
(iii) Community Relations Department (CRD) – responsible for the law enforcement
strategy and duties set out in ICAC Ordinance Section 12 (g) and (h).
3. The Operations Department
A simplified organisation chart of the Operations Department is at Appendix B.
As this paper focuses on prevention, it will not go into further details of theorganisation of Operations Department.

- 38 -

4. The Corruption Prevention Department
A simplified organisation chart of CPD is at Appendix C.

The department isheaded by the Director of Corruption Prevention (DCP) and is organised into two
Divisions and a Centre for Anti-Corruption Studies (CACS).

Each Division has anumber of Groups each having a charter of responsibilities.

Other than theManagement Group (M Group), each Group is responsible for corruption prevention
in a number of government departments and public bodies (duties under Section 12(d)and (f) of the ICAC Ordinance).

Some of the Groups also have responsibility over

one or more specialty areas in addition, e.g.:(i)Group C – civil service integrity policies and matters.

(ii) Group E – corruption prevention in the construction industry and public works
projects.
(iii) Group F, also named Advisory Services Group (ASG) – corruption prevention in
the private sector, including handling requests for advice from private sector
entities (Section 12(e) of the ICAC Ordinance).
Also under CPD is the Centre of Anti-Corruption Studies (CACS) established in
April 2009 to facilitate and conduct research and analytical studies on issues
pertaining to the development of anti-corruption initiatives locally, regionally andinternationally.
5. The Community Relations Department
A simplified organisation chart of CRD is at Appendix D. The department isheaded by the Director of Community Relations (DCR) and is organised into two
Divisions. Division 1 is comprised mainly of specialist units tasked to publicise
anti-corruption messages through the mass media and territory-wide programmes.
Division 2 mainly provides in-depth, face-to-face corruption prevention education- 39 -

services to the public through a network of Regional Offices.

The duties of the

major units are:(iv) Regional Offices – reach out to the local communities to enlist support for
ICAC’s work and receive corruption reports and answer enquiries about
corruption.
(v) Hong Kong Ethics Development Centre (EDC) – promotes business andprofessional ethics in the business sector and provides consultancy services on
ethics programmes, including ethics training.
(vi) Youth and Moral Education Office (YMEO) – formulates and implements
strategies and programmes for preventive education for youths and students.
(vii) Mass Communication Office (MCO) – makes use of media for publicising
ICAC’s work and preventive education for the public, such as television andradio advertising campaigns, TV dramas and training videos.
C. Oversight of the Work of the ICAC
The work of the ICAC comes under the scrutiny of five independent committees
comprised of responsible citizens drawn from different sectors of the community andappointed by the Chief Executive of the HKSAR.

They oversee different aspects of

ICAC’s work (Appendix E).
The Commissioner reports directly to the Chief Executive of the HKSAR on thework of the ICAC, and regularly attends meetings of the Executive Council andLegislative Council and their relevant committees (e.g. the Security Panel) to brief
their members and answer questions on ICAC’s work.

- 40 -

II. EFFECTIVE WAYS TO PREVENT CORRUPTION IN HONG KONG
(THE SYSTEM APPROACH)

A. Preventing Corruption in the Public Sector
1. Partnering Approach
In the prevention of corruption, the ICAC adopts a partnering approach with thegovernment bureaus and departments (GBDs) and public bodies (PBs).

The

GBD/PBs are convinced to recognize that prevention of corruption and integrity
management is part of good governance and hence they should assume ownership ofsuch with the ICAC providing assistance.

CPD has formed Corruption Prevention

Groups with major GBD/PBs, chaired by their directorate officers.

The Corruption

Prevention Groups hold regular meetings to discuss and monitor collaboration toprevent corruption, including identification of areas requiring corruption prevention
audits (see A.2) or corruption prevention advice (see A.3), and implementation of the
Ethical Leadership Programme (see A.4).
2. Corruption Prevention Audits
The ICAC’s duty to examine procedures and practices of GBD/PBs to identify
risks of corruption and secure the revision of work methods to reduce the risks is done
by CPD, through corruption prevention studies/audits of specific functions andprocesses (e.g. letting and administration of contracts, licensing) of the GBD/PBs.
The study/audit subjects are selected based on inherent corruption risk, actual
occurrence of corruption, importance to people’s livelihoods, amount of public funds
involved, etc.

Reports on the findings and the recommendations, after endorsementby the Corruption Prevention Advisory Committee, are sent to the organisations’ top
management.

CPD also monitors implementation of the agreed recommendations

and provides follow-up assistance if necessary.

- 41 -

A corruption prevention study/audit normally involves the following:(i)Study of relevant laws and regulations and the organisation's relevant policies,
procedures, guidelines, and relevant papers.

(ii) Study of other information on the subject, such as media reports, Audit Reports,
CPD's own records or past reports on the subject, reports of relevant past ICAC
cases and/or briefing by investigators on relevant cases or trends.
(iii) Interviews

withemployeesoftheorganisation

responsible

for

the

function/operation under study.
(iv) Examination of files and records of past cases relating to the function/operation
under study.
(v) Site observation of performance of the function/operation under study.
(vi) Information available to the public or relevant stakeholders regarding therelevant policies, procedures and operations.
(vii) Occasionally, if necessary, interviews with experts in the field.

Aspects and control measures examined during corruption prevention
studies/audits and the recommended enhancements usually cover the following:(i)adequacy and clarity of policies, procedures and guidelines on integrity andconduct as well as performance of the function/ operation;(ii) clarity, enforceability, etc. of the relevant legislation and regulations;(iii) adequacy of segregation of duties, approval procedures and level of authorities,
and other checks and balances;(iv) proper and adequate documentation for enhancing accountability;(v) openness and fairness, e.g. consistency in treatment of similar cases, equal
opportunity for all eligible parties to participate;- 42 -

(vi) transparency, e.g. disclosure and publicity of application procedures, vetting
criteria, processing time, reasons for rejection, etc.;(vii) simplicity and user-friendliness of the system and procedures, e.g. whether there
are long waiting times or excessive barriers/procedures (which are conducive tobribery);(viii)adequacy and effectiveness of supervision and monitoring, e.g. conduct ofadequate supervisory checks, availability of management and exception reports
for senior management's review;(ix) independent checks and monitoring, e.g. by internal audit, independent
non-executive directors;(x) existence and publicity of feedback/complaint channels;(xi) any other preventive and detective control measures applicable to thefunction/operation being examined;(xii) any existing practices that may be conducive to corruption, such as excessive
discretion exercised by staff, deviation from policies or procedures, frequent
overrides, lax enforcement or non-enforcement of any law or regulation, etc.
3. Corruption Prevention Advice
In addition to detailed corruption prevention audits, CPD provides quick andearly/simultaneous

corruption

prevention

adviceto

GBD/PBsincurrent

initiatives/projects, such as formulation of new legislation (e.g. proposal for a new
Charity Law in Hong Kong), policies and procedures (e.g. procedures for the
Immigration Department’s Automated Vehicle Clearance System), tendering of major
contracts (design-and-build contract for the new Government Central Offices).

For

major projects of public concern (e.g. tendering of contract for the operation of the
New Cruise Terminal at Kai Tak), CPD also sends an observer to sit on the tender- 43 -

boards.

The approach has proved to be effective in ensuring proper andcorruption-free tendering processes in the projects.
In the event that corruption or other malpractice has occurred, CPD conducts a“post-mortem” analysis on the case. If system weakness is identified as a factor in
the case, follow-up action will be taken with the GBD/PB concerned, such as reviewof the procedures, advice on enhanced controls, or if necessary a full-scale corruption
prevention audit of the business function concerned.

This does not include only

prosecuted cases but also cases which have not resulted in prosecution due to lack ofevidence, no criminal offence but only non-criminal misconduct involved, etc.
4. Capacity Building
Corruption cannot be prevented by the ICAC alone.

Managers and supervisors

in GBD/PBs play an important role in preventing corruption in their organisations by
putting in place suitable controls and vigilantly exercising supervision and monitoringover their staff and day-to-day operations.

CPD therefore also adopts a capacity

building approach and, through training, raises their awareness and capacity inhelping to prevent corruption in their GBD/PBs.
5. Preventing Corrupt Practice by Contractors or Partners
GBD/PBs frequently work with contractors or business partners in various ways,
e.g. engaging a contractor to provide services to the GBD/PB, or engaging acontractor or partner (e.g. under a public-private partnership) to deliver public
services to the public. It is necessary to prevent such contractors/partners fromengaging in corrupt practices, including bribing the public officers, or their employees
from accepting bribes in delivering the public/social service.

Measures undertakenby the GBD/PBs include:(i)

Anti-bribery clauses prohibiting tenderers/contractors/partners from offering- 44 -

corrupt gifts to public officers and anti-collusion clauses in GBD/PBs’ tendering
documents and/or contracts.
(ii) Probity clauses in GBD/PBs’ contracts requiring the contractor/partner to adopt
corruption prevention practices in performing the contract or function (e.g.
prohibiting their employees from accepting advantages from third parties inrelationship to their duties under the contract).
(iii) Specifying procedures that the contractor is required to follow/perform for acontrol purpose (e.g. conduct of inspections, keeping of records, submission ofreports/information certified by a person-in-charge).
(iv) For certain types of government contract (e.g. works contracts), suspension ofcontractors convicted of bribery offences from bidding such contracts for aperiod of time.
(v) Conduct of corruption prevention audits by CPD on the contractors/partners’
procedures in performing the public function (e.g. private sector operated Car
Testing Centres appointed by the Transport Department to conduct annual
examination of private cars), or give corruption prevention advice to thecontractors/partners (e.g. advising a works contractor suspended from bidding
government contracts due to the occurrence of corruption on how to improve
integrity management).
B. Preventing Corruption in the Business Sector
1. Corruption Prevention Advisory Service
The ICAC has a duty to advise any persons on ways to prevent corruption onrequest (Section 12(e) of the ICAC Ordinance). The service is free of charge and wepledge confidentiality on the requests and information received.

The corruption

prevention advisory service is promoted and given to private sector entities through- 45 -

various channels including:(i)Advisory Services Hotline – A telephone hotline and mailbox is provided andpublicised through various means (e.g. ICAC website) for members of the public
to request corruption prevention advice or services.

Requests may also bereceived by referral from CRD or other contacts.
(ii) Collaboration with partners – CPD collaborates with partners such as tradeassociations and professional bodies to organise events/seminars for theirmembers (see the following section on “Corruption Prevention Capacity
Building”).

Through such events or the partners’ newsletters or circulars,

advice is given and additional, tailored service is promoted to their members.
(iii) Victim companies – Following investigation of a private sector corruption caseby the ICAC, if system weaknesses is noted, the case may be referred to the CPD
for follow-up.

Where considered appropriate, ASG will approach the victim

company to offer corruption prevention advisory service.
(iv) Organisations funded by GDB/PB – GDB/PBs fund a large number oforganisations under various schemes to perform functions/services that achieve adesired social objective, e.g. NGOs, social enterprises, schools, residentialbuilding owners receiving government subsidies to repair their buildings.

Inview of the amount of public funds and the corruption risk involved, someschemes encourage the funded organisations to seek corruption prevention
advice from CPD.
There are about 350 to 400 cases of advice/service provided to private sector
entities each year.
2. Corruption Prevention Capacity Building
ICAC cannot prevent corruption in each and every private organisation.

- 46 -

We

must enlist the support of senior executives, managers, supervisors and practitioners
in the private sector to help prevent corruption in their own organisations.

Toachieve this, we need to raise their awareness to corruption risks and build up theircapacity to prevent corruption.

To do so, CPD again adopts a partnering strategy

mainly through two approaches:(i)

Trade (vertical) approach – collaborating with trade associations and/or trade
regulators (e.g. Hong Kong Federation of Restaurants and Related Trades, Hong
Kong Retail Management Association, Securities and Futures Commission) tocarry out initiatives to enhance corruption prevention awareness and capacity ofmembers/practitioners of their trades (see next paragraph).

This covers

preventing corruption in key business functions in a trade.
(ii) Functional(horizontal)

approach–collaborating

withprofessional

bodies/associations (e.g. Hong Kong Institute of Certified Public Accountants,
Chartered Institute of Purchasing and Supply, Institute of Internal Auditors) tocarry out initiatives to enhance corruption prevention awareness and capacity ofmembers/practitioners of their profession (see next paragraph).

This focuses on

preventing corruption in a business function that is common to all/most trades.
The methods for corruption prevention capacity building employed include:(i)

Publication of Corruption Prevention / Ethics Management Guides for referenceby managers, practitioners, business operators of specific trades or professions.

(ii) Development of corruption prevention training materials (e.g. training slides,
videos, guides, and case studies) for use by CPD/CRD officers in providing
corruption prevention training, or by other organisations’ trainers who have been
given train-the-trainer training or training guides.
(iii) Conduct of corruption prevention seminars, workshops and continuous- 47 -

professional

education

sessionsformembersofpartnersormanagers/practitioners in individual organisations.
(iv) Development of corruption prevention training courses/modules for use byeducational institutions (e.g. universities, vocational training institutions) indegree, diploma or other courses of disciplines that relate to relatively morecorruption-prone trades/professions (e.g. construction engineering, property
management, purchasing and merchandising).
3. Corruption Prevention Audits
While prevention of corruption in the private sector is mainly through theprovision of advisory services and capacity building, sometimes more in-depth
corruption prevention studies/audits (as those for the public sector) may also be
conducted for private sector entities with their Boards' support such as:(i)

Major subvented NGOs/charities – in view of the considerable government
subvention and public donations they receive, their procedures such as
procurement and service delivery processes may be subjects of corruption
prevention studies/reviews.

(ii) Corporations fully or partially owned by the government or public bodies that are
not public bodies – in view of their public ownership and the public interest
involved, their relevant procedures may be subjects of corruption prevention
studies/reviews.
(iii) Private corporations – on request, and if considered worthwhile, corruption
prevention reviews may be conducted on corruption-prone processes of a private
corporation, but this is very uncommon.

- 48 -

III. EFFECTIVE WAYS TO PREVENT CORRUPTION IN HONG KONG
(THE HUMAN APPROACH)

A. Public Education
1. Mass Communication
Mass media is an effective vehicle for publicising the work of the ICAC andenlisting the public’s support in fighting corruption.
(i)Effective uses include:

Advertising campaigns comprising television and radio messages,
complemented

withposters

mountedthroughout

theterritory(Appendix F shows a few samples of ICAC posters).
(ii) Bi-annual production and television-broadcasting of the “ICAC
Investigators” drama series, each featuring five episodes on fivesuccessful ICAC cases in recent years.
(iii) Use of the Internet to extend the reach of ICAC’s messages, e.g. an“ICAC Channel” website to keep the public abreast of ICAC’s latest
events and activities, uploading of integrity issues onto popular social
networking websites to stimulate discussion, and a youth website “iTeen
Camp” targeting primary and junior secondary school students.
(iv) Press releases on ICAC’s corruption prevention work and newspaper
articles on integrity issues are used to raise public awareness on
corruption risks and enlist their support for ICAC’s work.
2. Community Relation and Activities
To maintain a high level of ICAC’s presence in the community and keep thefight against corruption on the public agenda, CRD officers attend meetings ofvarious district consultative committees to expound on ICAC’s work and gauge
opinion leaders’ views on anti-corruption programmes.

- 49 -

Regular contacts aremaintained with district organisations, and district activities (e.g. workshops, roving
exhibitions) conducted to reinforce the community’s commitment to sustaining a
probity culture.

The ICAC Club was set up in 1997 to provide a channel for the

public to partake in ICAC activities and demonstrate support for the anti-corruption
cause, its about 1,200 members include professionals, district leaders, working youth,
students, retirees, and housewives. An ICAC Club newsletter is published regularly
to keep members informed of the latest developments.

B. Youth Education
It is important to educate children and youths on correct moral values andanti-corruption attitudes at an early stage.

The major work in youth education inrecent years is highlighted below.
1. Tertiary Education Institution (TEI) Students(i)

ICAC Ambassador Programme – mobilizes university students toorganise on-campus activities to promulgate anti-corruption and probity
messages.

In addition, the i-League was also established for the ICAC

to maintain contact with former and current Ambassadors to maintaintheir continuous support in anti-corruption work.
(ii) Personal Ethics Module for Tertiary Institutions – developed for
adoption by TEIs for their students. Seven universities have agreed toinclude the module in their relevant programmes.
2. Secondary School Students(i)Interactive Drama – Professional drama troupes are hired to perform
interactive

dramasthat

illustratetheanti-corruption

law

and

consequences of corruption to secondary school students. About 280
shows for some 55,000 secondary students are arranged annually.

- 50 -

(ii) ICAC Ambassador Programme – About 1,100 students from 135 schools
have been recruited as “ICAC Ambassadors” to disseminate integrity
messages to their schoolmates through activities.
(iii) Liberal Studies Teaching Package – A Liberal Studies (ICAC
Investigators) Package was recently developed for senior secondary
students, using two episodes of the “ICAC Investigators 2009” drama
series and a variety of learning activities as teaching aids.
3. Primary School and Kindergarten Students(i)Senior Primary General Studies Teaching Packages – Our General
Studies Moral Education Package, comprising audio-visual teaching aids
and materials for activities, helps inculcate self-discipline and proper
attitude towards material wealth among students.

(ii) Gee-Dor-Dor Cartoon Series and Teaching Packages for Kindergartens
and Primary Schools – Produced since 1999, the Gee-Dor-Dor Cartoon
Series publicise moral values to children.

Parent-child activities werealso organised to enlist parents’ support in promoting positive values toyoung kids.

An electronic book based on the cartoon series and othermoral education stories was also produced for young kids.
C. Integrity Management in the Public Sector
1. Ethical Leadership Programme (ELP) for the Government Sector
While CRD has been providing integrity and anti-bribery briefings togovernment officers since its establishment, to further enhance probity culture andpromote ethical leadership in the civil service, the ICAC and the Civil Service Bureau
jointly launched the ELP in December 2006.

Under the ELP, each GBD is requested

to appoint a senior directorate officer as the organisation’s Ethics Officer, to be- 51 -

responsible for developing and sustaining ethical culture in the GBD and assumes
overall responsibility for all integrity management work.

They have to submit to the

Civil Service Bureau an annual return on the GBD’s work under ELP.

At present,

there are some 150 Ethics Officers.
Periodic seminars on different topics concerning integrity, conduct and discipline
are organised for the Ethics Officers and their assistants. A government intranet“Online Community for Ethics Officers” has been developed to facilitatecommunication and provide up-to-date information and reference materials related tointegrity issues.
2. Integrity Training for Public Bodies
Apart from GDBs, CRD also provides integrity and anti-bribery training for staffof public bodies, which include public hospitals, public utilities companies, public
transport companies, TEIs, etc.
D. Integrity Management in the Business Sector
1. Promotion of Business Ethics
To promote integrity and anti-corruption culture in the business sector, the ICAC
launched a Business Ethics Campaign in 1994 jointly with the major chambers ofcommerce in Hong Kong.

At the first conference, business leaders arrived at aconsensus that long-term promotion of business ethics was of strategic importance toHong Kong.

In response, the ICAC set up the Hong Kong Ethics Development

Centre (EDC) in 1995 to act as a focal point for promoting ethics in Hong Kong andadvising the business sector on ethics and integrity management programmes.
EDC partners with related regulatory bodies, chambers of commerce, trade andprofessional associations in developing tailor-made ethics training modules andpackages for specific trades and professions, and promotes the training modules and- 52 -

other corruption prevention products to their members.

Ethics and corruption

prevention elements were also injected into the licensing and professional
qualification requirements of the trades/professions and continuous professional
education programmes.

EDC also organises regular thematic corruption prevention

seminars for small and medium enterprises.
2. Integrity Management of Contractors and Business Partners
On CPD’s recommendation, it has become a standard practice for GDB/BPs to
include probity clauses in their contracts with service providers, suppliers or otherpartners/operators requiring them to prohibit their staff from accepting advantages
from third parties and to avoid/declare conflicts of interest in relation to their duties
under the contract.

They are also required to ensure the requirements are madeknown to the staff, e.g. through training.
In view of the higher corruption risk in public works projects, CPD has astanding arrangement with the Development Bureau to, on a project by project basis,give corruption prevention briefings to key staff of major works projects’ consultants
and contractors.
IV. CASE STUDIES
A. Public Sector
1. Corruption Prevention Audit – Enforcement of Driving-Offence Points System
In Hong Kong, driving-offence points are assigned to a driver for certain traffic
offences (e.g. speeding).

The Transport Department (TD) would summon a driver

who has accumulated 15 or more offence points within a period of two years toappear in court, and apply for an order to disqualify him from holding and renewing adriving licence.

Our study in 2008 revealed that, among other risks, many drivers

who had accumulated over 15 offence points (over 100 offence points in extreme- 53 -

cases) could still drive on the roads because the summonses had not been successfully
served on them, mainly due to the inaccurate addresses reported by the drivers or
because they avoided receiving the summonses.

Apart from ineffective enforcement,

this also gave rise to risk of collusion between the offending drivers and the police
officers responsible for serving the summonses.

TD had no legal power to serve

summonses on an offending driver even when he approached TD to renew his driving
licence, and also could not refuse his renewal request. CPD thus recommended
legislative amendments to plug the enforcement and corruption loopholes.
Subsequently, the law was amended to strengthen the powers of TD and the Police tofacilitate more effective enforcement of the system.
2. Preventing Corruption in Public Infrastructure Projects
Readers may refer to Transparency International’s Report titled “Hong Kong:
The Airport Core Program and the Absence of Corruption”3 published in 1999 which
provides a good and detailed case study.
In a more recent project involving a contract for the operation of a major public
facility, CPD secured the government’s agreement to include probity requirements inthe agreement with the operator to ensure it adopts anti-corruption policies andmeasures in managing and operating the facility. CPD also assigned a representative
to sit in the project’s tender assessment panel as an observer to ensure fair and proper
procedures were adopted.
3. Ethical Leadership Programme – Correctional Services Department
Right after the launching of the ELP, the Commissioner of the Correctional
Services Department (CSD) set up a departmental Ethics Committee to strengthen
ethical governance and integrity management in the department.

3

http://unpan1.un.org/intradoc/groups/public/documents/APCITY/UNPAN013116.pdf- 54 -The Ethics

Committee is chaired by the department’s Ethics Officer who is the Deputy
Commissioner, and meets quarterly. An Assistant Director of the ICAC sits on theCommittee to give advice.
Among the first things the Committee did was to conduct research on potential
integrity risks faced by frontline and supervisory staff.

The issues identified werethen featured in case studies in a lively training video used in integrity training
sessions to facilitate discussion, raise awareness, and provide guidance on proper
conduct.

ICAC provided input during development of the video and training guideand conducted train-the-trainer workshops for CSD training officers.

To enlist the

support of senior staff in implementing the department’s integrity management plan,
the Ethics Officer personally conducted a seminar for all institution heads andsuperintendents.
CSD’s implementation of ELP displayed strong commitment at the top toenhancing ethical culture.

The programme plan was carefully thought out andvigorously implemented.

Different levels of staff were involved and the progress

was closely monitored by the Ethics Committee.
B. Business Sector
1. Corruption Prevention Advisory Service – Administration of Obstetric Services in
Private Hospitals
For various reasons, Hong Kong has become a highly popular place for Hong
Kong pregnant women in Mainland China to give birth. In both public and private
hospitals, the supply of obstetric delivery service appointments was outstripped bydemand, with many Mainland China customers willing to pay excessive fees to agentsin order to secure an appointment.

Apart from various social problems, the situation

has given rise to significant risks of corruption for hospital staff, with private hospitals- 55 -

more susceptible. CPD’s Advisory Services Group, with the support of the Hong
Kong Private Hospitals Association, quickly responded to the situation and conducteda study on the administration of obstetric delivery services in the private hospitals.
The study found that, as the risk was relatively new to the private hospitals, some
did not have ready measures to prevent possible manipulation of the booking andallocation of obstetric delivery service appointment slots. Following the study, theAdvisory Services Group produced a corruption prevention guide for reference by theprivate hospitals, and organised a seminar jointly with the Association to raise theirawareness. The Group also provided follow-up, tailored advice to individual private
hospitals.
2. Director’s Ethics Training Programme
In the wake of local and overseas corporate failures in recent years whichshowed signs of malpractice in top management of corporations, EDC took the lead tospearhead a systematic training programme for company directors, “Ethics – The
Core Value of Leadership” Training Programme in 2007, in collaboration with 12
partners including the Securities and Futures Commission and Hong Kong Exchanges
and Clearing Limited, major chambers of commerce, and professional bodies.

Workdone included:(i)

Directors' Forum in 2007 – Some 150 company directors, top and senior
executives and their professional advisors attended the Forum, at which theyprobed into the ethical challenges they were facing and shared views on how to
put ethical governance and leadership into practice.

(ii) Conference on Corporate Governance in 2008 – Some 350 directors and senior
executives of listed companies attended to examine the topical issues of ethicalgovernance and share experience on good governance practices.

- 56 -At theconference, CRD launched a “Toolkit on Directors’ Ethics” and a training video"Boardroom Agenda", while CPD launched “A Corruption Prevention Guide for
Listed Companies”.
(iii) An ethics training module was incorporated in the accreditation training
programme for company directors provided by the Hong Kong Institute of
Directors.

V. CONCLUDING REMARKSThe three-pronged strategy has been an effective strategy for fighting corruptionin Hong Kong, and is still an effective one for sustaining a clean government andbusiness environment in Hong Kong.

Building on the foundation, the ICAC iscontinuously improving its strategies and measures with new and enhanced initiatives
to meet new challenges in the changing environment.
Nevertheless, it must be pointed out that the three-pronged strategy for combating
corruption is only part of the “formula” in the fight against corruption.

Fundamental

success factors include a country’s or city’s institutions, and what is referred to by
Transparency International as the “National Integrity System”.

Hong Kong had infact undergone major institutional improvements in the later part of the last century,
along with the ICAC’s vigorous efforts in fighting corruption, to achieve its overall
success in stamping down corruption.

Any country or city committed to fighting

corruption cannot rely only on a stand-alone corruption prevention strategy, but must
make fundamental institutional improvements.

- 57 -

APPENDIX A
ICAC’s Statutory Duties and Strategies

Duties of the Commissioner

Corresponding(ICAC Ordinance Section 12)

Strategy(a)receive and consider complaints alleging corrupt
practices and investigate such of those complaints as
he considers practicable(b)

investigate any alleged or suspected offence under thePrevention of Bribery Ordinance (Cap. 201, ICAC
Ordinance (Cap. 204), etc.

(c)

Law Enforcement

investigate any conduct of a prescribed officer4 whichin the opinion of the Commissioner is connected withor conducive to corrupt practices and to report thereon
to the Chief Executive of the HKSAR(d)examine the practices and procedures of government
departments and public bodies5, in order to facilitate
the discovery of corrupt practices and to secure therevision of methods of work or procedures which, inthe opinion of the Commissioner, may be conducive tocorrupt practices(e)Prevention

instruct, advise and assist any person6, on the latter’s
request, on ways in which corrupt practices may beeliminated by such person(f)advise heads of Government departments or publicbodies of changes in practices or procedures

4“Prescribed officer” is defined in the Prevention of Bribery Ordinance (Cap. 201, Laws of HongKong) to include, among others, any person holding an office of emolument, whether permanent or
temporary, under the Government, any judicial officer and any ICAC officer.
5“Public body” is defined in the Prevention of Bribery Ordinance to include, among others, theGovernment, Legislative Council, Executive Council, etc. and any body listed in Schedule 1 to theOrdinance.
6
This covers any persons or entities in the private sector.

- 58 -

compatible with the effective discharge of the duties
of such departments or public bodies which theCommissioner thinks necessary to reduce thelikelihood of the occurrence of corrupt practices(g)educate the public against the evils of corruption(h)enlist and foster public support in combating
corruption- 59 -

Education

APPENDIX B- 60 -

APPENDIX C

Corruption Prevention Department
Director of
Corruption Prevention

Division 2

Division 2

Assistant Director 2

Assistant Director 2

Assignment Groups

Management Group

Assignment Groups

Government
Departments &Public Bodies- Disciplined Services- Transport- Home Affairs- Judiciary- Commerce & Trade- Labour- etc.

Administrative
SupportGovernment
Departments &Public Bodies- Public Works
Departments- Housing- Health- Public Hospitals- Lands- Environmental- Public Utility
Companies- etc.

Civil Service Integrity
Public Elections
Public Procurement

Corruption
Prevention
Advisory
Committee
Secretariat

Construction Industry

Schools &Educational Institutions
Etc.

- 61 -

Advisory Services
Group
Private Sector
NGOs, Charities
Building
Management(Private Sector)
Government
Departments &Public Bodies- Financial Sector
Regulators- Travel Industry
Regulators

Centre ofAnti-Corruption
StudiesResources for studyof issues pertaining tofight against corruptionin Hong Kong andinternationally
Platform for scholarly
exchange and collaboration
with international &Mainland anti-corruption
agencies & institutions

APPENDIX D- 62 -

APPENDIX EICAC Advisory Committees
1.

The Advisory Committee on Corruption is the principal advisory body ofICAC and oversees all the Commission’s activities and keeps its operational,
staffing and administrative policies under review.

2.

The Operations Review Committee, among other things, receives from theCommissioner information about all corruption complaints and reports oncompleted and prosecution cases, and advises on the follow up of cases not
subject to prosecution or caution.

3.

The Corruption Prevention Advisory Committee advises the Commissioner
on the work of CPD, including considering and endorsing its corruption
prevention study reports.

4.

The Citizens Advisory Committee on Community Relations advises theCommissioner on the work of CRD and monitors public attitudes towards
corruption in general.

5.

The ICAC Complaints Committee oversees the handling of non-criminal
complaints against ICAC officers.

The terms of reference of the Advisory Committee on Corruption, Operations Review
Committee, Corruption Prevention Advisory Committee, and Citizens Advisory
Committee on Community Relations as at 2010 can be found in the Report of ICAC
Advisory Committees 20107.

7

http://www.icac.org.hk/filemanager/en/Content_1020/2010.pdf- 63 -

APPENDIX F
Samples of ICAC Posters

A Sample Poster in 1970s

A Sample Poster in 1980s

A Sample Poster in 2000s

A Sample Poster in 2010/11- 64 -