Corruption is a long-standing issue for companies all over the world. Recent internationally known cases involve both oil companies and local governments. In Italy, on 31 March 2016, the Industry Minister Federica Guidi resigned after being accused of pressuring parliament to pass an amendment that would help her partner score millions of euros in contracts from French energy company, Total. In Brazil, former president, Dilma Rousseff, risked impeachment due to a bribery case related to Brazil’s national oil company, Petrobras.
The case of Douglas Linares Flinto involves the same countries and industry. He was fired in 2001 by Eni do Brazil (Eni’s Brazilian subsidiary) after reporting several cases of misconduct. Flinto strongly believes that his firing was the result of a retaliation, thus he decided to fight back against the company, a fight which has lasted nearly 15 years. In 2003, Flinto founded the Brazilian Ethics Institute in order to promote ethics in both the business and student world. In July 2014, he launched the blog Eni’s Way to spread his story all over the world. In March 2016, the Italian journalists Andrea Greco and Giuseppe Oddo told Flinto’s story in the book “The Parallel State. The first investigation on Eni”. Flinto considers this fact “a victory”, both for him and for “all the whistleblowers that are being killed (and buried) around the world by companies that don’t respect their Code of Ethics”. Douglas Linares Flinto agreed to share his entire story with News Leak.
Mr. Flinto, what is you experience with Eni do Brazil?
My story began back in 2001 when I was an executive of Eni’s Brazilian subsidiary and temporarily took over the main sales management of Agip Brazil. There, I received complaints of irregularities involving conflicts of interests, internal corruption, fraud, and even emission of “cold invoices”. Respecting the determinations of Eni’s Code of Ethics, I reported the misconducts. On the following weeks, little happened and I ended up getting fired. After invoking Agip Brazil’s Committee of Ethics, I got an answer from the Brazilian operation saying that my resignation happened due to an “administrative and organizational restructuring” and not because of a “retaliation”, as I alleged.
Why do you think you were a victim of retaliation?
In my view, the millionaire scheme that I had reported had metastasized throughout the company, and in Agip Brazil’s backstage. The top management, in collusion, ran the illegalities and illegal activities practiced in Eni’s Brazilian subsidiary.
What did you decide to do?
I decided to write to the Board and to the company’s main shareholders, including to the main one, the Italian Government. PwC (PricewaterhouseCoopers), which at that time was the auditing firm hired by Eni, also received a copy of the new corresponding item. It’s the board of directors, the highest authority inside and outside the company walls, the embodiment of the “Corporate Governance” and the “Big Boss” of all the executives, including the CEO. Besides, the board is responsible for ensuring the code of ethics. The resignations at Agip Brazil continued until it reached the commercial management. A few months later, Eni announced to the market the sale of all the Brazilian assets to the state oil company Petrobras, currently involved in the largest corruption scandal in Brazil. However, no contact was ever made with me, and Eni never answered any of my mails! On the contrary, after “killing” the whistleblower in Brazil, the company tried to do the same thing in Italy!
What do you mean?
In 2010, Eni decided to file a civil action in the Court of Rome against me and the Brazilian Business Ethics Institute asking indemnity of 30 million Euros for damage caused by my libel and slander. In this action, oddly enough, Eni states that all the facts alleged by me are untrue and that, in fact, the company made an undercover investigation in Brazil to ascertain any damage. And I, for not collaborating, ceased the trusting relationship, resulting in my resignation.
Instead of Eni accepting its mistakes, ascertain its faults, enhance controls and honor its own code of ethics, the company chose to hide behind a frivolous lawsuit in an attempt to intimidate and silence me, and leave under the carpet the ills of its management.
Fortunately, in late 2014, the judge ruled Eni’s lawsuit as “groundless”. The company didn’t accept my proposal agreement but preferred to appeal the sentence.
How has this experience changed your life?
I have always imagined I would make my career in the oil market. I had never imagined I would be driving a civil society organization that promotes such an important and recurring topic, the ethics. What triggered it was the fact that I was dismissed after serving a code of ethics, motivating me to create an institution to promote ethics in the business and, especially, the student world, because the students of today are tomorrow’s companies’ leaders. It’s been almost 14 years since the foundation. A time in which I work as I have never worked before: happy, satisfied and making sure I am doing the right thing!
What happened with Eni also caused the loss of my retirement. In Brazil, companies deduct from their employees’ salary a percentage for retirement. Companies transfer this value to the federal government. At a certain age and a certain contribution period, the citizen is entitled to retirement, which is paid monthly by the government. However, when Agip Brazil dismissed me, I’d had many financial difficulties and for not getting a new job, I could not pay the government for my future retirement. Because of that, today I am a man who is over 50 years old and who will not be entitled to a retirement paid by the government of my country.
Finally, Eni put me in Brazil’s “black list” and this attitude never let me go back to the labor market even though I have, modesty aside, an excellent education.
Do you have any evidence of this “black list”?
Everyone knows it exists, but no one can prove its existence. It is a veiled subject in the human resources department of companies around the world, I am absolutely certain the Eni Group has put me on this “black list” to prevent these people getting new jobs. Every time a company receives a curriculum vitae, the company consults this list to know whether it can hire that professional.
Do you regret anything?
Not at all! I would do it all over again. Why? The answer is simple: Ethics is always worth it! Despite everything, I will continue, until my last breath, with my personal quest to rescue and restore my name, my honor, my image, and my reputation unfairly depreciated.
I hope my story can be an example and serve as motivation to other whistleblowers that should never give up trying to rescue and restore their name, their honor, their image and their reputation, which were thrown in trash cans by hypocrite companies that don’t act with integrity, honesty, responsibility, transparency and uses “ethics” just as a “marketing tool”. Unethical companies need to be unmasked so as to no longer harm their employees and their families around the world.
How do you think we should fight corruption in business?
I always say, companies don’t have a life. It is the people who give life to the companies! Therefore, companies need to invest, not only in their corporate reputation but mainly in the character of their employees, from the gatekeeper to the CEO. And the board has a primary role in this process. The directors of the board need to charge the main executives that, in their daily life, they will exalt ethics and the importance of conducting business with integrity, honesty, transparency and Ethics.
Evidently, it is not the code of ethics that will say whether a company is ethical or not – just see my story – but, this important instrument, in my view, is the “highest law” in the company, turning itself into a compass. Code of ethics can’t be just an ornamental book to meet the requirements of the stakeholders but needs to be the bedside book of all the people within the company.
The other side of this coin are the whistleblowers. They are not enemies of the companies! Quite the contrary, whistleblowers are the greatest protectors of the name, the reputation, the image of the companies. Ask any CEO “Do you prefer to take notice of the illegalities inside your company from the newspapers or from your employees?” However, many companies that make public their code of ethics, that motivate its employees to report any illegal activities or nonconformities with the words and spirits of its code of ethics, end up “killing” (and “burying”) its whistleblowers because the “participants” of the internal fraud and corruption scheme don’t want to be “unmasked” and, often, the board itself is a part of or is conniving with unethical practices of a group of employees. And this has a harmful and devastating effect within any company, the whistleblowers who should protect their companies are scared of having the same destiny: their resignation, their professional career interrupted and the loss of their retirement.
With the exception of a few countries, there are no mechanisms to protect whistleblowers and they continue to be “killed” and “buried” around the world. And that’s the reason why the Brazilian Business Ethics Institute is already working on the creation and the launch of a “Global Platform for Protection of Whistleblowers” which will use the power of the internet to try and end (or at least greatly reduce) the number of “serial killer” companies.
Let’s shift to what is happening today in Brazil. What is your opinion on the Petrobras scandal?
Petrobras isn’t formed only by corrupt employees who defraud the coffers of the company. Most people work with dedication, passion, and integrity of character in both companies. However, there is a mounted scheme behind the scenes of the company, conducted by “graduated people” that no one has the courage to face. Now, in Brazil, with the Lava-Jato (“Car Wash”) Operation, that completed two years of operation and is conducted jointly by the US FBI, by federal prosecutors and by a federal judge, whose inspiration is the “Operazione Mani Pulite” (Operation Clean Hands) held in Italy in 1992, is changing history in Brazil. The Brazilian population believes that corruption and impunity are being left behind in the past and will not return again. And the Brazilian Business Ethics Institute believes there will be a significant improvement in the quality of Ethics of the companies operating in Brazil.
News Leak asked Eni its position on Mr. Flinto’s case. Here is the company view:
“The dismissal of Mr. Douglas Linares Flinto occurred in 2001 and was due to his reticent and non-cooperative behavior held during internal investigations aimed at preventing any conduct detrimental to the company Agip do Brazil, a company which was sold by Eni in 2004. Mr. Flinto subsequently objected the reasons which brought to his dismissal, providing generic motivations not supported by any evidence or fact. In view of all this, his dismissal has been considered fully lawful, and so confirmed, by the competent Brazilian judicial courts”.