• Careers
  • Contact Us

What could I possibly learn from another Bribery Act article?

on Wednesday, 28 October 2015.

When I joined the firm recently, my induction included compulsory anti-bribery training, even though I run training for clients. It made me wonder how many of our clients treat compliance with bribery legislation as seriously as we do.

In this blog:

Development of your Business Over Time

Businesses change and grow over time. Like all management tools, anti-bribery policies and procedures must evolve and be updated to reflect current and future business activities.

As your organisation has evolved over the last 4 years, have your policies been adapted to reflect those changes and new risks? Have you continued all those well-meaning practices you may have started in 2011 after the Bribery Act 2010 (the 'Act') came into force?

You may have established a presence abroad, either by physically opening operations or subsidiaries abroad or by increasing the trade you do overseas. In almost all cases this will result in a greater risk of bribery, regardless of industry. Your policies and practices, however, should reflect these developments in your business. If they do not, they are unlikely to be relevant. As a result, you may not be able to show that you have taken adequate precautions against bribery risks within your organisation.


SFO Investigations

In recent years a number of major household names in the UK have been linked to bribery investigations, usually involving their activities abroad. The Serious Fraud Office is also making more noise about conducting its own investigations into bribery and corruption in foreign countries.

The scope for serious reputational and financial damage caused by these allegations is significant.


Key Considerations

In particular, cases like this remind me of:

  • The difficulty of ensuring that you are compliant when you have overseas operations and use of the services of overseas agents. An offence committed abroad by an agent or subsidiary can still be an offence by the parent company under the Act.
  • The importance of having appropriate anti-bribery and corruption safeguards in place. Such safeguards include having adequate policies and procedures in place, in addition to the training staff and agents. If your company is investigated, you will have to show that all parties engaged by you conduct themselves in accordance with the requirements of the Act. Companies are guilty of an offence if a bribe is made and they do not have appropriate policies and procedures in place to prevent bribery from happening.
  • The importance of actually implementing, auditing and making people aware of your anti-bribery policies.


Effects of Non-Compliance

Individuals and companies who have committed an offence under the Act can be criminally liable for non-compliance. This can result in an unlimited fine for the company, plus a prison sentence of up to 10 years. There can also be a fine for the individual actually doing the bribing (or accepting bribes), as well as the 'controlling mind'. The 'controlling mind' could be a senior manager or directors of the company, if they are reckless as to the existence of bribery.


Corporate Offence

It is an offence for a company to fail to take adequate precautions to prevent bribery.


Improving likelihood of compliance 


Top Level Commitment

Anti-bribery procedures need to have top level commitment in order to be effective. Companies should aim to have an anti-bribery culture in place. Part of this culture (as well as through the means set out below) could include a statement of values that illustrate a commitment towards the prevention of bribery and corruption.

As mentioned above, merely paying lip service to policies and procedures is not sufficient. They must be implemented, reviewed, amended and referred to.


Training

Companies need to train all relevant staff, agents and others engaged in your business on anti-bribery and corruption issues.

The more senior the role, the more in depth the training should be. Following in-depth training when they join, temporary staff in telesales may only need to read your bribery policy by way of an update. The Board of Directors may require more in depth follow up training. Everyone must be trained and it should be re-visited regularly. At VWV, all of our staff (from reception to the Managing Partner) receive anti-bribery and corruption training at least once after joining. All staff receive updates as the law evolves and are required to review the policy as necessary, or if any changes are made to it.


Policies and Procedures

Anti-bribery and corruption policies need to be used and reviewed regularly. They need to be updated to reflect developments in law and best practice, as well as your company's business activities. For example, if you have started or increased the scale of your overseas operations since your policies were drafted, they will need updating.

Many clients have a gift reporting procedure, whereby gifts over a certain value (say £50) are logged and reported to a senior manager. The Senior Manager can then review them and identify any patterns. Such procedures can demonstrate that an organisation complies with the Act, but only if they are actually used and audited.


Supply Chain Compliance

Businesses should ensure (to the extent that you can) that members of your supply chain comply with the requirements of the Act themselves.

Before doing business with you, Primes in the sector will often require you to demonstrate compliance with the Bribery Act. You could also get written confirmation from your suppliers that:

  • They have compliant anti-bribery and corruption policies
  • All relevant staff have received appropriate training at least once since joining your organisation (or since the Act came into force if they have not joined you in the last 4 years) and understand the bribery policy and procedures.
  • If you do the above, then it increases the likelihood that you will be able demonstrate that you have a compliant supply chain. It should also reduce the likelihood of your becoming embroiled in a bribery as a result of a third party's actions.


Summary

It is important that companies do not pay lip service to the requirements of the Bribery Act 2010 and compliance with policies and procedures. We all have the tendency to slip into old or bad habits, or to fail to update our procedures to reflect changes in our business. Revisiting your bribery policies, procedures and training can help prevent this, or at least ensure that the 'bad habits' do not put you or your business at risk.


The ramifications of bribery and the importance of compliance to the Primes in the sector mean it is something that all suppliers should take seriously. If you need further information, please contact Ben Holt in our Aerospace and Defence Team on 0117 314 5478.

Leave a comment

You are commenting as guest.