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Rapid Response Team: 0800 559 3500
Switchboard: +44 (0)203 947 1539
Rapid Response Team: 0800 559 3500
Switchboard: +44 (0)203 947 1539

Effective Strategies for Global Bribery & Corruption Investigations

Author: Nicola Sharp  2 December 2013
4 min read

An international survey showed that a worrying number of companies worldwide had little knowledge of how to prevent bribery and corruption. Aziz Rahman explains why a little research into the risks can go a long way to removing them.

Not every survey tells us something that we either need or want to know. Yet the findings of a survey of more than 300 international companies produced some unpleasant reading that many in business should really have taken note of by now.

The findings, published in “International Business Attitudes to Corruption’’ back in 2013, painted a disturbing international picture of many companies simply not taking any notice of the risk they are running when it comes to prosecution for business crime.

These findings included the facts that:

  • Only half of the companies surveyed had procedures in place to ensure background and reputation checks are made on business associates in local and foreign markets.
  • Over a third of them had no formal policy statements forbidding bribes.
  • Nearly half did not have policies or statements banning facilitation payments.

Perhaps what is most telling is that the survey was based on an evaluation of 316 general counsel and senior in-house lawyers at some of the world’s largest companies. Of those asked, 13 corporate counsel respondents said the chances of their company having to investigate a breach of anti-bribery laws by an employee in the next two years was between 90 and 100%. Another 60 of those asked said such an incident was likely — and only a third of respondents classed such an outcome as very unlikely.

The picture the survey painted of companies relying on luck rather than design becomes more alarming when a closer look is taken at the survey details. Bribes were cited as the main cause of concern by 58% of respondents, with 29% bemoaning the risk of demands for bribes when trying to secure new contracts. Despite this, 91% of those surveyed said their companies had no specialised anti-corruption training for employees in high-risk areas — and nearly 75% of those asked had no anti-corruption training at all. Only 40% had confidential whistleblowing hotlines for employees to report corruption concerns.

On the whole, the survey offered little encouragement for those looking for strong anti-corruption measures in business. And yet the survey did find that those asked were keen to report suspected corruption. More than two-thirds of respondents said they were now more likely to report suspected bribery involving an employee to regulators than they would have been in previous years. Over half said they would report a suspected bribe to regulators before conducting an investigation, even if the details were uncertain. Those who said they would investigate the suspicion first and only self-report if the violation was confirmed were in the minority. And only 15% said they would only report a confirmed violation if it was likely to be discovered by the authorities.

The Value of Compliance

So, based on this survey, it would appear that even if the big companies’ legal boys are aware their anti-corruption procedures are inadequate they are at least prepared to report any wrongdoing that may become apparent. But such an attitude begs the question: why don’t they choose compliance over risk? Why don’t they make their company fully aware of the legislation that is in place, the penalties it can carry and the ways in which such punishments can be avoided?

To illustrate the point, let us consider the Bribery Act 2010 as an example of the risks that can be taken. The Act makes a company liable for the corrupt actions of any staff, agents or third parties acting on its behalf, either in the UK or abroad. It makes it an offence for anyone to pay, receive or request a bribe, either directly or indirectly, at home or abroad, to perform a relevant function improperly. There is also an offence of using a bribe to influence a foreign official to gain a business advantage. Companies can commit an offence where a bribe has been paid on their behalf by an associate — an employee, agent or other party acting for it. 

A company’s liability under the act is, therefore, a clear-cut issue. And – it is worth bearing in mind the findings of the survey, at this point — any company facing prosecution under the Act will have to show that it carried out all adequate procedures to prevent any of its representatives acting improperly. Without stating the obvious, those who responded to the survey would do well to consider that to have any possible defence against prosecution, a company must be able to prove that it took all possible steps to be legally compliant. Such steps must take into consideration exactly which measures are appropriate to the way it operates and the bribery risks that exist in whichever business and geographical area it trades.

If an investigation is underway, a company will be in a much stronger position if it can produce proof that it took steps to be legally compliant. In such cases, any punishment handed down is unlikely to be anywhere near as big as it would be if the company had done its business while flouting — or being totally ignorant of — the risks of being embroiled in business crime. Those who took the time to be so honest in the survey would do well to consider that a strong anti-fraud workplace culture can only be instilled from the top down. The geographical areas, business sectors, agents and business partners that a company is involved with must be examined in detail to assess what potential risk they carry for bribery or other business crime. Without doing this, a company can make whatever claims it wants about cutting out corruption. But these claims will not carry any weight with investigators.

Steps a Company Should Take

So what exactly should a company be doing? As well as examining all aspects of its business, a company has to assess the legal obligations placed upon it. A policy of due diligence must include examination of all aspects of its business, especially potentially troublesome aspects such as facilitation payments, hospitality and referral fees. Clear reporting procedures have to be devised, implemented and publicised to staff and associates. Whistle blowing must be officially encouraged and seen to be acted upon. If these steps are taken, companies will be able to point to them as evidence of a clear anti-fraud approach should they ever face allegations of workplace fraud and corruption. There is no other way of being able to demonstrate that a company had appropriate procedures in place and acted in accordance with the law.

The legislation is in place and the authorities have more means to enforce it at their disposal than ever before. Companies can no longer afford to run the risks that the survey highlighted.

Nicola Sharp C 09983

Nicola Sharp


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Nicola is known for her fraud, civil recovery, arbitration and business crime expertise, her experience of leading the largest financial disputes and multinational investigations and her skills in devising preventative measures and conducting internal investigations for corporates.

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