University Sector-based Integrity Systems

1. University Sector-based Integrity Systems Barry Munns, Director Internal Audit, University of Technology Sydney Email: barry.munns@uts.edu.au

2. Sector-based Integrity Systems Aim of the Transparency International Integrity Systems Assessment project: “To map and analyse Australia’s mechanisms for pre-empting and apprehending corrupt practices and for developing best practice as a means of improving ethical regimes through the public and private sector.” Transparency International Australia, Australian National Integrity Systems Assessment: Queensland Handbook, July 2001

3. Sector-based Integrity Systems “The National Integrity System is the sum total of the institutions and practices within a given country that address aspects of maintaining the honesty and integrity of government and private sector institutions. Any attempt to address corruption effectively and sustainably involves an holistic approach, examining each of these institutions and practices and the various inter-relationships to determine where remedial action is required. Ad hoc reforms are unlikely to succeed. “ Transparency International Australia, TI Source Book 2000: Jeremy Pope

4. Sector-based Integrity Systems ICAC’s “Where to from here? “Whilst the findings of the research are encouraging, more can be done to build corruption resistance within the public sector. Most importantly, all organisations need to implement an effective risk management process. The Australian / New Zealand Risk Management Standard AS/NZS 4360:1999 advocates a seven-step risk management process… ICAC encourages all organisations to adopt the seven-step risk management process as a general approach to identifying and treating risks.” Profiling the NSW Public Sector: Functions, Risks & Corruption Resistance Strategies, ICAC, January 2003

5. Sector-based Integrity Systems AS/NZ 4360:1999 Risk Management Standard source: Standards Australia

6. Sector-based Integrity Systems • Basic project brief is: • to prepare a proposal on the best approach to tackle these problems. • to obtain general agreement and then form a consortium to progress the project. • The initial project comprises three components… • A Risk Assessment of University sector Integrity Risks. • A paper identifying and describing the primary elements of a generally accepted University sector Integrity Systems framework (treatments). • Development of a generally accepted normative model of University Sector Integrity Systems.

7. Sector-based Integrity Systems • The basic premise is that Corruption is an outcome of poor or non-existent Integrity Systems within Universities. • Corruption & fraud (it could be argued) is relatively immaterial and peripheral to the University Sector’s ‘main game’. • Integrity Systems are (in contrast) a key component of Good Governance, and Good Governance is an absolute requirement to have a Good University.

8. University Sector Integrity Systems Project University Sector(generic) Tailored to Specific University University Sector Integrity Risk Assessment Specific Uni Integrity Risk Assessment Specific Uni Integrity Systems Framework Generally acceptedUniversity Integrity Systems Framework • University context(values, commercialisation, regulation, Crossroads etc.) • Benchmark / Standard • Capability Maturity • Best / Good Practice • Progress through sharing?

9. University Sector Integrity Systems Project Risks Tools & Structures Conflict of Interest b • Code of Conduct b • Declaration of interests b • Delegations r • Procurement policy

10. Sector-based Integrity Systems Integrity Systems Components Results of a Q&D survey of Australian University Internal Audit Units…. “What Integrity Systems do you have or would like to have in your organisation?”

11. Sector-based Integrity Systems • Strategic • Strategic Vision • Code of Conduct • Code of Ethics • Leadership / Tone from the top • Strategic Plans incorporating values & ethics

12. Sector-based Integrity Systems • Culture • General culture & values • Ethics framework • Tone from the top • Multiple ‘bottom line’

13. Sector-based Integrity Systems • Internal Regulation & Compliance (Directives, Policy & Procedures) • Fraud • Corruption • Ethical Conduct • Internal Reporting / Whistleblower / Disclosures (protection) • Grievance Handling • Plagiarism • Consulting / Outside work • Conflicts of Interest • Intellectual Property • EEO and Equity • Research Conduct & Ethics • Use of University Assets – incl. IT Communication resources and devices • Disciplinary Procedures (Staff & Students) • Industrial Agreements • Appeals Mechanism • Academic Independence / Freedom • Internal / External Audit Reporting Framework (incorporating independence principal) • Financial Management • Human Resource Management

14. Sector-based Integrity Systems • Regulatory Compliance • State Acts • Federal Acts • Compliance Agencies (ICAC, CMC, Ombud, Auditor Office, Police, Privacy Commissions, DEST, IMA) • Treasurer Directions • University enabling legislation (including commercialisation requirements) • Professional Standards

15. Sector-based Integrity Systems • Training • Induction • Ethics training • Guidelines on how to respond to fraud / corruption

16. Sector-based Integrity Systems • Investigation • Investigators - resourced Internal Audit / Investigation Services • Outsourced specialist resources arranged and available as needed. • Investigation Standards

17. Sector-based Integrity Systems • Organisational Control Framework – Governance • Council / Board • Vice-Chancellor’s Office / CEO • Committees(including Audit Committee, Corruption Committee, Risk Management Committee, • Finance Committee etc.)

18. Sector-based Integrity Systems • Organisational Control Framework – Operational • Contracts & Procurement - transparency / probity / competition • Financial / Budgetary management • Internal Audit • External Audit • Management & Supervision • Delegations & Authorities • Grants / Research Funds Administration • Asset Management

19. Sector-based Integrity Systems • Technology • Security & Access controls • Privacy • Integrity of Student data

20. The Prototype IS Framework Database

21. Objective is to keep it simple. • Objective is to be able to ‘slice and dice’ as required. • Database comprises 3 things… • Integrity Elements (the ‘treatments’) • Integrity Risks • Integrity System Attributes (classifications or ‘tags’) • The Integrity System Attributes are the answer to questions we pose about the Elements

22. At what point does the ISE take effect? Before, during and/or after • Q. Is the ISE focused on individual, organisational and/or societal requirements? • At what level of the organisation does the ISE intervene? • Q. What are the key ethical areas which the ISE impact in? • At what level of governance is the ISE aimed? • Q. How does the ISE provide coverage of issues considered to be of particular concern, notoriety and high risk to University Internal Auditors?

23. Integrity Element Integrity Elements (data set)

24. Risks (data set)

25. Integrity Element Risks folder IS Attribtutes folder

26. Integrity Element Risks folder IS Attribtutes folder

27. Report on all IS Elements which covers risk of corrupt conduct

28. Where to from here??? • Need to develop the prototype a bit more. • Need to agree on the questions to be posed on the Elements (which determines the Attribute values) • Need to populate the database with generally agreed Integrity System Elements (treatments), Risks, and Attributes

29. CorruptionPreventionNetwork To share information and to network on fraud & corruption prevention initiatives. www.corruptionprevention.net

30. Sector-based Integrity Systems Many thanks… Barry Munns – barry.munns@uts.edu.au