Participants in a panel on cooperation agreements between companies and the State defend the instrument, but believe it still suffers from a lack of awareness and disapproval from public opinion

The director of the Center for Studies on Integrity and Development (Ceid), Giuseppe Giamundo Neto, defended leniency agreements this Tuesday, the 5th, in São Paulo — agreements in which companies and the State agree that information and evidence of wrongdoing will be provided — and acknowledged that the instrument still suffers from a lack of awareness and, as a result, disapproval from public opinion.

“Public opinion in general has a negative view of this instrument, which is about preserving the company. In several respects, it needs to be seen differently, because it is positive. There is acknowledgment of the wrongdoing, sharing of information about it with the State and, as a result, easier prosecution,” said Giamundo. “A leniency agreement cannot be seen as ‘the sanction that should have been applied and wasn’t’, or ‘the company that should have closed and didn’t’. That is a rather ignorant position. It is not the legal entity that commits wrongdoing, but individuals.”

The statement was made at the panel on cooperation agreements between companies and the State at the 9th Paths Against Corruption Seminar, held by Estadão and Instituto Não Aceito Corrupção (Inac). The discussion also featured São Paulo’s municipal comptroller general, Daniel Falcão, and the Integrity Secretary of the Office of the Comptroller General (CGU), Marcelo Pontes Viana. The conversation was moderated by Estadão’s politics coordinator in São Paulo, Ricardo Corrêa.

The participants in the panel on cooperation agreements between companies and the State at the 9th Paths Against Corruption Seminar The participants in the panel on cooperation agreements between companies and the State at the 9th Paths Against Corruption Seminar

Viana presented CGU figures on the leniency agreements signed since the Anti-Corruption Law was enacted in 2013. Out of 90 proposals, 29 agreements were signed, totaling BRL 19 billion in amounts agreed to be returned to the State.

“The leniency agreement is recent, but the culture of negotiated and consensual resolutions outside litigation is also relatively new in Brazil. The primary goal of these resolutions is greater efficiency. After ten years, we recognize that we want to keep improving this instrument. One of the necessary improvements is better institutional coordination,” said Viana.

Giamundo believes leniency agreements in Brazil are at a stage of “near maturity”. “The framework exists, but there is still some uncertainty about whom to approach. And the company’s assessment of whether or not to enter into an agreement is complex. This calculation is always one of cost and benefit. ‘Is it beneficial and advantageous for me to sign this agreement and be subject to implications and sanctions?’. We are at the near maturity of leniency agreements.”

Head of São Paulo’s municipal comptroller office, Falcão recalled that the city’s first leniency agreements were negotiated in constant contact with the CGU, since there was no experience with this procedure in São Paulo. “We had to build this expertise at the CGM. The advantage of this instrument for the company is that it comes out with a ‘clean record’ and can sign contracts. We have two leniency agreements signed and several early settlements.”

He also stressed that a leniency agreement does not mean impunity. “The company feels it in the flesh. It will continue to exist and will be able to sign contracts, but it suffers. The State gets back the profit it made from the fraudulent operations, in addition to the fines.” Falcão said the CGM has signed agreements of various kinds with companies of different sizes, with amounts ranging from BRL 70,000 to BRL 10 million.

The Paths Against Corruption Seminar has established itself as one of the main national forums for debate on transparency, integrity, compliance, ESG and anti-corruption. Almost 80,000 people followed the last two editions, in 2022 and 2023. This year’s panels and conferences are being streamed live on Estadão’s website. See the full program.

Originally published by Estadão (in Portuguese).