We have collaborated effectively with the public authorities, who acknowledge the company is a victim. We have set our control mechanisms into motion and improved our standards.
We are facing these challenges with the same level of commitment with which we have achieved important milestones in our operating performance.
We collaborate with the investigations: We have collaborated effectively with the work of the public authorities, as acknowledged by the Judiciary and the Public Prosecutor’s Office. We have systematically met the demands of the external control bodies (Federal Court of Auditors - TCU, Ministry of Transparency, Inspection, and Controllership General of the Union - CGU, and the Public Prosecutor) and we will continue our efforts to collaborate with investigations and audits.
Legal Measures for Reimbursement: We are coauthors of the Public Prosecutor’s Office in the administrative misconduct lawsuits against the contractors and executives pointed to as responsible for the irregularities in the scope of “Car Wash” Operation.
These initiatives are in addition to a set of measures that are being adopted to ensure full compensation for the losses the company suffered, including those related to its reputation.
Through November 2016, we had recovered R$661 million through the leniency agreements signed by the Federal Public Prosecutor’s Office, and we will continue to seek full compensation of the amounts through the various reimbursement measures applicable.
Increased strictness in hiring: We have made the supplier management process stricter to increase security in the procurement of goods and services and to mitigate risks of corruption. Now, to join the register, companies must provide detailed information on their structure, finances, and on their mechanisms designed for compliance and combating fraud and corruption. Additionally, they are also evaluated through a process known as Integrity Due Diligence.
New Information Channel: We have put in place a new Information Channel, which is independent, confidential, and impartial, available to our external and internal audiences. A specialized independent company is in charge of receiving complaints. The Channel works 24 hours per day to receive, whether via the site or by phone, allegations of fraud, corruption, and money laundering, as well as of harassment, discrimination, or any other irregularity.
Internal Inquiry Commissions: We have established Internal Inquiry Committees to investigate evidence of nonconformities related to corporate rules, procedures or regulations, as well as to support administrative measures and consequent procedures. The results will be forwarded to the competent authorities for the relevant measures to be taken.
Disciplinary measures: We have investigated and punished internal misconduct. We apply disciplinary measures to employees at various hierarchical levels for misconduct and harassment, damage to property, fraud, theft, negligence, and misuse of company resources, resulting in employment contract termination, suspensions, and written warnings.
Precautionary Blocking of Companies: We have blocked companies belonging to the economic groups mentioned in the affidavits as cartel participants in a precautionary manner. These companies have been precautionarily prevented from participating in our bids and from contracting with Petrobras. The decision for an interim injunction does not imply stopping or terminating existing contracts, nor the suspension of payments due for services rendered.
Training: Members of the Board of Directors, Executive Board Officers, and employees have already gotten some training in compliance. At the holding company, the measure has reached 90 percent of the employees, while in the Petrobras System approximately 68,000 professionals have been trained.
The Brazilian Anti-Corruption Act, the American Anti-Corruption Act (FCPA - Foreign Corrupt Practices Act), the company's Code of Ethics and Conduct Guide are a few of the topics addressed in training.
Independent Internal Investigation Offices: In October 2014, we hired two independent law firms specialized in investigation, a Brazilian one (Trench, Rossi e Watanabe Advogados) and an American one (Gibson, Dunn & Crutcher LLP) to conduct independent internal investigations.
Special Independent Committee: In December 2014, we established a Special Independent Committee, which acts as the reporting line for the internal independent investigations conducted by the law firms. The Director of Governance, Risk and Compliance, João Adalberto Elek Júnior, is on the Committee, along with retired Federal Supreme Court Justice Dr. Ellen Gracie Northfleet and the Chief Compliance Officer of Siemens AG from 2007 to 2010, Dr. Andreas Pohlmann.
A new management model has been being built with a focus on improving financial management and the decision model, investing in the synergy between the boards and in a more agile process, with increasing security.
We are implementing the company’s new organizational structure and its new management and governance model. The reformulation was made as part of our response to the new reality of the oil and gas industry, which has led us to prioritize more profitable activities, making us more competitive. In addition to expanding our control and compliance mechanisms, the new structure foresees activity redistribution and centralization, area merging, and the revision of the decision-making model.
Investigations are underway into the practice of alleged irregularities in detriment to Petrobras. The investigations are conducted by the Brazilian Federal Police and the Federal Public Prosecutor's Office, under the “Car Wash” Operation. The operation is quite extensive and involves investigations related to various criminal practices committed by individuals in different parts of the country and sectors of the economy.
The Federal Public Prosecutor's Office focused part of its investigations on irregularities involving suppliers and contractors responsible for the supply of goods and services to Petrobras and revealed a scheme of undue payments involving these companies.
The above-mentioned undue payment scheme involved a large number of suppliers and contractors, who used funds received in contracts for the supply of goods and services with Petrobras to make undue payments to political parties, political agents, former Petrobras employees, and others involved in the scheme, corrupting them so that they not only omitted taking measures against the criminal organization’s operations, but also to practice certain acts in their interest.