These days we’re all too aware of allegations of bribery and corruption in the business world, most recently from the Fifa scandal that continues to rumble on.
With effect from from the 1st July 2011 The Bribery Act 2010 came into force across the UK.
So what does this mean for you?
A quick overview of the Bribery Act
The purpose of the Act is to stamp out bribery and corruption in the workplace. There are three principal offences under the Act, which are:
- Offering or receiving a bribe
- Bribing a foreign public official
- Failing to prevent a bribe being paid on an organisation’s behalf.
Offering or receiving a bribe
Under the Act it is an offence to offer or give a financial or other advantage to someone else for the purpose of influencing them to perform their relevant function or activity improperly or as a reward for something they have already done.
By ‘improper’ the Act means performing in a way which goes against good faith, impartially or in accordance with a position of trust. A common sense approach is necessary when deciding if performance has been improper, particularly when it comes to existing hospitality arrangements.Bribing a Foreign Public Official
Similarly, it is an offence to promise or give a financial or other advantage to a foreign public official to influence his or her performance in official functions in order to obtain or retain business or an advantage in the conduct of business as a result.
The exception to this is when, in some situations, foreign public officials may be legally required or permitted to be influenced, in which case there is no offence. Crucially the Bribery Act isn’t there to stop genuine hospitality and promotional activity, but to prevent decisions being influenced because of the unjust personal benefit of officials involved in decision making.
Failing to Prevent Bribery
It’s not just offering or receiving a bribe that goes against the law; failing to prevent bribery can also be an offence if the company is unable to prove that appropriate measures to reduce risk were implemented. Therefore it is essential to have relevant procedures in place to guard against bribery. As the Act considers all who perform services for or on behalf of a business as being associated with that organisation, the law applies also to agents, subsidiaries and possibly contractors and suppliers, as well as employees.
Crucially the Act accepts that no prevention measures can be effective 100% of the time, so there are some defences provided. Above all, everything will be judged in context.
The Principles of the Bribery Act
The first step in protecting your business from both internal and external bribery risk is to carry out an assessment of the likely risks. When doing so, consider factors such as the structures and procedures of your business, your sector and your business partners. Also take into account potential risks in transactions and business opportunities. Finally, if you do business in a foreign country, be aware of the country’s attitude to bribery and corruption as well as its reputation.
In order to comply with the Act all commercial organisations must draw up and implement appropriate procedures which detail the company’s commitment to protect against the risks of bribery. These should demonstrate how risks are being avoided and include implementation details.
Commitment to ward against bribery and corruption must be apparent from the top down, and it’s the responsibility of the top level management to establish and uphold an anti-bribery culture within the organisation by communicating company policy, providing necessary training and leading by example.
A final word
By ensuring the right measures have been taken, assessing your risks and demonstrating your commitment to the Act, your business is well on its way to guarding itself against bribery and corruption. As with all policies, it’s only worth having one if it’s known about and properly understood, so make sure you communicate it properly and effectively both internally and externally. We recommend you do the following:
- Complete a bribery risk assessment to assess the risk of bribery in your organisation
- Develop a policy to ensure these risks are minimised and the workforce is aware of what they can and cannot do
- Send a letter or email to staff effectively communicating the policy
- Consider whether key members of the workforce may require training on the Bribery Act
Once your company policy is in place, it’s important to keep it current so review it regularly and re-evaluate it when necessary. It might also be possible to gain certification from a member organisation in your sector, which not only ensures your company’s compliance with the Act but also provides assurance to partners and potential clients.
For more information on the Bribery Act 2010, visit https://www.justice.gov.uk/guidance/docs/bribery-act-2010-quick-start-guide.pdf and https://www.justice.gov.uk/guidance/docs/bribery-act-2010-guidance.pdf
