Framework of Compliance
Anti-bribery and Anti-corruption
Anti-bribery and anti-corruption laws and regulations are becoming stricter every year. As a global company with projects in about 20 countries around the world, we recognize the importance of taking a zero-tolerance policy towards bribery and corruption. Accordingly, all officers and employees are required to always act with integrity, which is one of the INPEX Values1 shared across our entire organization. HR evaluations must also be conducted according to these values.
In addition to requiring compliance with the anti-bribery and anti-corruption laws and regulations in the countries where we operate, the Business Principles and Code of Conduct stipulate the establishment of sound and appropriate relationships with governments and administrative authorities, and prohibit political donations except in legally permitted cases. We make no donations relating to political activities.
We have participated in the United Nations Global Compact since 2011 and have declared our commitment to preventing corruption. Moreover, we established the INPEX Group Global Anti-Bribery and Anti-Corruption (ABC) Policy2 and related internal regulations under our Code of Conduct, and are putting in place measures to prevent bribery and corruption.
2 INPEX Group Global Anti-Bribery and Anti-Corruption (ABC) Policy
Management Structure
We have established a structure whereby the director in charge of compliance and the Compliance Committee can promptly consider and take actions if a serious compliance-related incident occurs. The officer in charge of compliance and the Compliance Committee cooperate with the Audit & Supervisory Board and its members, the accounting auditor, the Audit Unit (our internal audit department), and the equivalent bodies or departments in our subsidiaries to: (1) develop and implement compliance measures; (2) monitor implementation; (3) raise compliance awareness; (4) receive reports on compliance violations and conduct investigations; (5) issue warnings and take other measures in response to violations; and (6) institute measures to prevent the recurrence of violations. In addition, the officer in charge of compliance reports to the Board of Directors in relation to the above activities periodically or as required.
Remediation actions to be taken in relation to compliance violations, including any disciplinary actions, are stipulated by Business Principles, Code of Conduct and internal regulations. There were no confirmed cases of serious compliance violations in FY2022 but we include details of reported violations and their management in the Whistleblower System and Grievance Mechanism section of this report.
We have established a structure whereby the director in charge of compliance and the Compliance Committee can promptly consider and take actions if a serious compliance-related incident occurs. The officer in charge of compliance and the Compliance Committee cooperate with the Audit & Supervisory Board and its members, the accounting auditor, the Audit Unit (our internal audit department), and the equivalent bodies or departments in our subsidiaries to: (1) develop and implement compliance measures; (2) monitor implementation; (3) raise compliance awareness; (4) receive reports on compliance violations and conduct investigations; (5) issue warnings and take other measures in response to violations; and (6) institute measures to prevent the recurrence of violations. In addition, the officer in charge of compliance reports to the Board of Directors in relation to the above activities periodically or as required.
Remediation actions to be taken in relation to compliance violations, including any disciplinary actions, are stipulated by Business Principles, Code of Conduct and internal regulations. There were no confirmed cases of serious compliance violations in FY2022 but we include details of reported violations and their management in the Whistleblower System and Grievance Mechanism section of this report.
Compliance System
Compliance Training
We regularly conduct compliance training for all employees to encourage them to carry out their duties in compliance with laws and regulations. Training covers specific topics—such as prevention of harassment and discrimination—and includes sessions targeted at specific employment roles/tiers. In FY2021, this included harassment prevention training for regular employees at offices in Japan, and training on anti-bribery/anti-corruption and the Antimonopoly Act for offices and Group companies in Japan.
We have also adapted and implement our Code of Conduct at overseas offices in line with local laws and regulations as well as culture as part of our efforts to strengthen our global compliance structure.
Data on training held in each country are listed in the ESG Performance Data.3
Compliance Awareness Surveys, and Harassment Prevention Training for Managers
In addition to a short annual compliance assessment, we conduct compliance awareness surveys for all employees every three to four years. The surveys consist of about 80 questions on subjects such as harassment and other compliance violations, organizational culture, and the level of awareness of measures. We then hold harassment prevention training for managers based on the assessment results. This includes instruction on how to prevent harassment of and between staff.
Whistleblower System and Grievance Mechanism
We actively respond to inquiries, complaints, and grievances from all stakeholders—both internal and external—at our Japan-based and overseas sites.
Internally, we operate a whistleblower system in accordance with the Whistleblower Protection Act. We have set up a helpline for receiving all reports related to discrimination, human rights, and harassment. We have also launched the INPEX Global Hotline with local language support, which specializes in three business-critical risk areas: bribery and corruption, violation of antitrust laws (competition laws), and accounting fraud. The helpline has internal and external (law firm) contact points, while the INPEX Global Hotline is wholly administered by an external service provider. Reporting can be completed anonymously.
We have recently amended some internal regulations in line with the June 2022 revision of the Whistleblower Protection Act. This included adding retired officers or employees within one year of their retirement to the list of eligible whistleblower system users, which was previously only available to current officers and employees of our offices (worldwide). We also added provisions regarding the designation of personnel able to respond to whistleblower reports, and we invited external experts to provide training to these whistleblower response personnel.
We are committed to protecting whistleblowers from any negative consequences. In addition, the content of reports from whistleblowers and the results of investigations and responses are promptly reported to the full-time Audit & Supervisory Board Members to ensure that the whistleblower system functions more effectively.
During FY2022, INPEX received eight internal whistleblower reports and three external reports. Of these: ten reports related to suspected human rights, discrimination, and harassment violations; one related to employment; and one related to other matters. Some of these reports relate to more than one issue. Taking into consideration the advice of attorneys and other experts, the Compliance Committee promptly and appropriately responded to each report in accordance with the Compliance Structure Operating Regulations and the Whistleblowing Rules.
For the year ending December 31, 2022, there had been no confirmed cases of serious compliance violation, and three of the reports relating to suspected human rights, discrimination, and harassment violations remained under investigation. There were no compliance violations among the reported cases subject to disciplinary action as stipulated in the Code of Conduct. The number of consultations for each country is stated in the ESG Performance Data.4
We have a dedicated page on our website for handling inquiries and grievances from external stakeholders—including local residents and suppliers—and we respond to their feedback in a timely and appropriate manner. In Indonesia, in addition to our website, we provide support in the local language. In Australia, procedures have been established for community engagement and grievance management to appropriately address inquiries and grievances received from local communities.5 No grievances were recorded under those procedures during FY2022.
5 Addressing Community Feedback
Whistleblower System
Anti-bribery and Anti-corruption Initiatives
Our Anti-bribery and Anti-corruption (ABC) Guidelines went into effect in 2014 following approval of the Compliance Committee. In FY2017, we revised those guidelines to form our ABC Policy and concurrently developed our ABC Procedures. The INPEX Group Global Anti-bribery and Anti-corruption (ABC) Policy was established in FY2019 as a clear and comprehensive statement of our position on ABC. The policy is disclosed on our website.
In line with our policy and procedures, preapproval is required for the giving or receiving of gifts or entertainment, and we conduct proper and necessary due diligence regarding ABC risks of potential business partners. In FY2022, 114 cases of due diligence were performed in Japan, based on the risk level of each prospective business partner.
Since FY2015, we have been working to enhance the development and operation of our ABC structure by sequentially conducting risk assessments of our head office and overseas offices and implementing improvement measures based on the results of these assessments. In FY2022, we conducted risk assessments and ABC training at our head office-based Americas Projects Unit and at our Houston and San Antonio offices.In FY2022, we also added ABC training to our ongoing compliance training for new graduates and mid-career employees.
As an ongoing initiative to improve our global ABC compliance structure, we also regularly share information and exchange views on compliance activities with our overseas offices in Perth, Jakarta, and Oslo.
It should be noted that, in FY2022, there were no major violations or disciplinary actions related to ABC.
Enhancement of Transparency through EITI Participation
Since FY2012, we have been participating in and supporting the efforts of the Extractive Industries Transparency Initiative (EITI). This multinational initiative aims to improve the transparency and sound management of the flow of funds from extractive industries to the governments of resource-producing countries. As of May 2023, 57 resource-producing countries and many supporting countries (including Japan), companies in extractive industries, and nongovernmental organizations were participating in the EITI. We provide the EITI with data concerning the participating countries where we operate projects.