Introduction

This Standard on Fighting Corruption (SFC) addresses the concept of disclosure and its crucial role in deterring, preventing, and responding to fraud and corruption in public and private sector institutions. Disclosure is not merely a compliance requirement; it is a governance mechanism that safeguards transparency, accountability, and ethical conduct across all organizational levels. When effectively implemented, disclosure limits opportunities for abuse of power, reduces institutional opacity, and strengthens governance integrity.

Scope of this SFC

1. This Standard on Fighting Corruption (SFC) addresses the ethical and legal obligation of disclosure in the context of public and private transactions. It defines what constitutes adequate disclosure, clarifies when and how disclosures must be made, and identifies organizational responsibilities for ensuring that disclosures are timely, accurate, complete, and accessible.
   
   
2. This SFC applies to individuals, management, public officials, and those charged with governance who are in a position to withhold, misrepresent, or fail to disclose material information, whether deliberately or through negligence, thereby increasing their exposure to fraud or corruption. It also applies to non-governmental organizations and entities that manage or disburse public or donor funds.

Effective Date

3. This SFC is effective for periods beginning or after December 1, 2026. We recommend earlier implementation.

Objective

4. Management and, where appropriate, those charged with governance shall:

a. Ensure that the entity establishes and maintains a disclosure framework that promotes transparency, reduces the risks of fraud and corruption, and upholds the rule of law.

b. Promote a culture of openness by embedding disclosure obligations into organizational policies, financial reporting, performance evaluation, and internal control.

c. Ensure that disclosures are verifiable, relevant, and used proactively to detect misconduct and enforce accountability.

d. Require senior officers, public officials, and key personnel to disclose material information that could compromise institutional integrity, including conflicts of interest, related parties, and known instances of fraud. 

Definitions

5.  For purposes of the SFCs, the following term has the meaning attributed below:

a. Disclosure: The deliberate, timely, and complete communication of material facts, risks, interests, or decisions by an individual or entity to relevant internal or external parties, as required by law, regulation, professional standards, or ethical duty, for the purpose of lowering fraud and corruption risks and preserving institutional integrity.

b. Material Information: Any fact, condition, or circumstance that a reasonable stakeholder would consider significant in evaluating a transaction, making a decision, or assessing the ethical standing of an individual or entity.

c. Disclosure Medium: The appropriate channel, form, or method through which disclosure is made, depending on applicable laws, industry standards, or the nature of the information. This may include internal reports, official forms, public websites, official gazettes, regulatory filings, or direct notification to competent authorities.

d. Public Official: An individual designated as such under the applicable laws, rules, or regulations of a given jurisdiction. This includes elected or appointed individuals holding a legislative, administrative, or judicial position of any kind, whether permanent or temporary, paid or unpaid, at any level of government or public institution.

e. Related Parties: Individuals or entities identified as related parties under the applicable laws, accounting or auditing standards, or institutional bylaws in the relevant jurisdiction. These typically include close family members, entities under common control, and parties with a direct or indirect interest in transactions affecting the entity.

Requirements

To lower fraud and corruption risks, the entity shall:

6. Establish and enforce a written disclosure policy that defines the types of information subject to disclosure obligations, responsible parties, deadlines, and approved disclosure mediums. Those charged with governance shall periodically review and approve this policy. (E1)

7. Ensure that all disclosures of material information are complete, accurate, timely, and verifiable. Partial, misleading, delayed, or vague disclosures shall be treated as breaches of internal control and ethical conduct. (E2)

8. Require all employees, contractors, and third-party agents to declare actual or potential conflicts of interest before engaging in any decision-making, procurement, or regulatory interaction. (E3)

9. Designate an officer or unit accountable for monitoring institutional disclosure practices, including the validation, safekeeping, and submission of disclosures to regulators, stakeholders, or the public as required. (E4)

10. Maintain a permanent disclosure register that records all submitted disclosures, their status, related transactions, and any follow-up actions taken. (E5, E6)

11. Train all relevant personnel periodically on their ethical and legal responsibilities for disclosure. (E7)

12. Implement disciplinary and corrective measures for non-compliance with disclosure requirements, including concealment, falsification, or failure to act upon known material risks or information that is required to be disclosed. (E8)

13. Ensure disclosures related to public funds, procurement, donor financing, and regulated industries are publicly accessible, unless specifically exempted by law. (E9)

14. Disclose in the notes to the financial statements what management has done during the past 12 months to lower fraud and corruption risks in the entity’s significant processes. (E10)

15. Disclose in the notes to the financial statements any fraud or corruption incidents during the past 12 months that implicated senior officers. (E11)

16. Disclose the entity’s investment in anti-corruption for the past 12 months and provide a forecast of planned expenditures for the next 12 months. (E12)

17. Require an independent and competent third party to annually assess and opine on the entity’s compliance with this standard. The opinion shall be disclosed publicly or submitted to regulators, as applicable. (E13)

18. Ensure that all officers and employees disclose their related parties, as defined by applicable laws and standards. (E14)

Public Official

19. A public official shall disclose a complete statement of financial position, as required by applicable law, upon entering public service and at the end of each calendar year. (E15)

20. A public official shall not hold any actual, potential, or perceived conflicts of interest while in office. Suspected or actual conflicts must be reported immediately, with the individual recusing themselves from any related decisions or influencing them. (E16)

Explanatory Material

This section provides clarification and guidance to support the effective application of the requirements in SFC 300: Disclosure. It is not a substitute for the requirements but a practical reference for those responsible for implementation, oversight, and assurance.

E1. Written Disclosure Policy

A written disclosure policy is a foundational internal control tool that defines the scope, responsibilities, timelines, and mechanisms for all disclosures required under this standard. Those charged with governance should embed it into the organization’s compliance framework and approve it.

Example: A state-owned enterprise includes a policy annex in its governance manual requiring employees to disclose any economic interest in companies bidding for contracts, with quarterly certification of compliance.

E2. Completeness, Accuracy, and Timeliness

Disclosures must not be vague, partial, or selectively reported. Omissions, delays, or ambiguity weaken internal control and create openings for corruption.

Example: A finance director disclosed that he held shares in a company, but failed to mention that his spouse sits on the company's board. This omission misrepresents the whole conflict and violates this standard.

E3. Conflicts of Interest: Employees, Contractors, and Third Parties

Only employees may participate in internal decision-making. However, contractors and third parties can influence outcomes through their services. All individuals must disclose actual or potential conflicts of interest before providing services or engaging in transactions.

Example: An external IT consultant hired to assess vendor proposals must disclose if a former employer is among the shortlisted bidders.

E4. Disclosure Oversight Function

The officer or unit assigned oversight responsibilities (e.g., ethics officer, compliance manager) must be independent of operational decision-making and empowered to validate disclosures, ensure safekeeping, and escalate unresolved or suspicious disclosures to senior management or regulators.

Example: A compliance officer detects multiple disclosures involving ties to the same vendor. They escalate the issue to internal audit for further review.

E5. Safekeeping and Documentation

Disclosures must be securely stored, digitally or in hard copy, in a manner that protects confidentiality, preserves records, and allows for verification. Access should be limited to authorized personnel only.

Example: A whistleblower report containing a conflict disclosure is stored in an encrypted internal compliance system accessible only to the ethics committee.

E6. Disclosure Register

This is an institutional record of all disclosures received. It must include:

a. Name of the disclosing party

b. Type and nature of disclosure

c. Date of receipt

d. Status and decision

e. Any follow-up or mitigating action

Example: An entity’s register includes a procurement officer’s disclosure of friendship with a bidder, leading to their exclusion from the evaluation panel.

E7. Training on Disclosure Responsibilities

Training shall be mandatory upon initial appointment and repeated annually. It must include:

a. Real-life examples from the entity’s sector

b. Legal consequences of nondisclosure

c. Updates on applicable laws and institutional policy

Example: A health-sector NGO integrates disclosure training into its annual compliance workshop, with modules on donor transparency obligations.

E8. Disciplinary and Corrective Measures

Noncompliance, whether intentional or negligent, must trigger disciplinary action. The entity should define penalties ranging from written warnings to termination or referral to legal authorities, depending on the severity of the offense.

Example: A procurement officer who failed to disclose a familial relationship with a supplier is suspended pending investigation and removed from active procurement duties.

E9. Public Accessibility of Disclosures

Disclosures related to public funds, regulated activities, or donor financing must be accessible through public platforms, such as annual reports or official websites, unless expressly exempted by law.

Example: A university that receives state grants publishes an annual list of awarded contracts and discloses whether any conflicts were managed.

E10. Disclosure in Financial Statement Notes: Anti-Corruption Measures

This requirement compels management to report what specific, measurable steps were taken to lower fraud and corruption risks in the past year.

Clarification – “Significant Processes”: These refer to operational or financial processes with material exposure to fraud or corruption. Examples include procurement, grants management, payroll, regulatory approvals, and licensing.

Example Note Disclosure: “In FY2025, management implemented a dual-signature policy for procurement above USD 50,000, and required all vendors to complete conflict-of-interest declarations.”

E11. Disclosure in Financial Statement Notes: Incidents Involving Senior Officers

If any credible or proven incident of fraud or corruption involving a senior officer is disclosed, it must be done while protecting due process and privacy, as required by law.

Example: “A senior executive in the treasury department was suspended in May 2025 pending an internal investigation into unauthorized wire transfers. The case has been referred to law enforcement.”

E12. Disclosure of Anti-Corruption Investment

Entities must report the amount spent on anti-corruption activities in the past year and provide a forecast for the next 12 months.

Example: “In FY2025, the entity spent USD 140,000 on compliance audits, fraud risk assessments, and staff training. Projected expenditures for FY2026 are USD 180,000.”

E13. Independent Opinion on Compliance

An external and competent third party, such as an accredited audit, law, or compliance firm, should annually assess compliance with SFC 300 and provide a written opinion. This strengthens institutional accountability and credibility and builds stakeholder trust.

Example: “An independent review by ABC Governance Consultants found the entity to be compliant with SFC 300 requirements, with minor improvements recommended in supplier due diligence documentation.”

E14. Disclosure of Related Parties

Entities must follow the legal and accounting definitions in their jurisdiction (e.g., IFRS, IPSAS, local codes). Related party disclosures must include the nature of the relationship and the transaction details.

Example: “A board member’s daughter owns a company that provided IT services to the entity during FY2025. Total value of the services was USD 42,000, and the transaction was pre-approved by the board’s audit committee.”

Public Official Examples

Public officials must submit a complete statement of assets, liabilities, and interests, whether located domestically or abroad, when assuming office and annually thereafter. If no law mandates it, the entity shall require equivalent declarations.

E15. Disclosure of Financial Position

Example: A newly appointed minister submits a statement of financial position disclosing personal real estate holdings, shareholdings in three companies, and outstanding loans.

E16. Managing Conflicts of Interest

Public officials must not hold or appear to have any conflicts of interest. If a potential conflict arises, they must report it immediately and recuse themselves from all matters related to it.

Example: A mayor discovers that her cousin's company is bidding on a municipal project. She reports the relationship in writing and abstains from any meetings or decisions related to the contract.

Application to NGOs

Non-governmental organizations (NGOs), especially those managing public or donor funds, are subject to this standard. Key expectations include:

a. Public disclosure of anti-corruption measures in financial or annual reports.

b. Declaration and tracking of conflicts of interest by board and project leadership.

c. Transparent disclosure of incidents involving senior personnel or donor-funded programs.

d. Donor and regulator access to related party disclosures and independent assessments.

These requirements help safeguard donor trust, beneficiary confidence, and public accountability.