Anti-Corruption, Anti-Bribery and the Foreign Corrupt Practices Act: Are your bases covered?

anticorruptionquoteIn July of this year, the United Kingdom’s Anti-Bribery Act went into effect.  That legislation is described by experts as the strictest anti-bribery legislation that has been adopted – and there is a good chance that you are subject to it.  Any company doing business in the UK, regardless of the scope or volume of that business, are considered by the UK’s Ministry of Justice can be subject to enforcement.

While the UK Anti-Bribery Act might be the most recent and arguably most wide-reaching, anti-bribery regulation is not new.  The United States has its own Foreign Corrupt Practices Act (FCPA), a federal regulation that has been in place since the 1970’s.  Like the UK’s Anti-Bribery Act, the FCPA focuses on bribery of foreign officials.  The continued globalization of business, as well as anti-terrorism initiatives, have made the US’s Department of Justice and Securities and Exchange Commission much more diligent about their enforcement of the FCPA.  If you are a US company doing any foreign business, you need to have an FCPA compliance program in place.  (I wrote about the FCPA earlier this year, if you are interested in more detail.)

And those are just the big names.  Anti-corruption, anti-money laundering and a wide range of anti-bribery laws exist at state and federal levels.  Legal regulations aside – your customers, investors and other stakeholders want to know that they are working with an ethical organization that is committed to fair business practices.

Do you have an anti-corruption program in place?  Are you bases covered from both an ethical and legal standpoint?

What does it take to cover your bases?  There are, of course, some specific guidelines for each regulation – but an overall program should consider these key points:

1.  Tone at the Top

Like any compliance program, anti-corruption programs start with the tone at the top.  Do your executive committee and Board of Directors make it clear that unethical and illegal behavior is unacceptable?  Is that made clear both internally to employees, and externally to customers,  vendors and investors?  Are partnerships and relationships subject to the same clear guidance?

2.  Risk Assessment

The depth and scope of your anti-corruption program will be driven by the depth and scope of the risk your organization faces in this area.  A company with a sales channel to Canadian retailers faces a much lower level of risk than an organization with high value construction projects in Africa or Russia.  A full risk assessment is needed to determine how far your program must go.

3. Clear Policies and Procedures

The tone at the top might be clear, but if the policy is murky, the message isn’t going to get through. Be sure that the policies and detailed procedures provide clear guidelines for what is and is not considered “ethical” or “in compliance”. Policies should not just apply to your employees – although this is arguably most critical – but also to your partners, suppliers, vendors, etc. In both the UK Anti-Bribery and US FCPA legislation, companies are responsible for the actions of their partners acting on their behalf.

4.  Communication

Now you have clear policies.  Great!  Do your employees know they are there?  What about your vendors or partners?  Be sure that the information is available in a place that is easily accessible by all – and that you regularly communicate updates.  No updates?  Communicate anyway as a reminder.

5.  Documentation

Like any compliance program, having a program is great – but being able to prove that the program is in place and effective is critical.  Anti-corruption can be a tricky thing, with subjective decisions made within stated guidelines.  Documentation of every decision – every gift, every entertainment expense, etc – is critical, along with the rationale that was used in making that decision.

6.  Regular Monitoring, Review and Updates

Don’t put an anti-corruption program in place and forget about it.  The policies need to be reviewed.  The training needs to be revised and redelivered.  The expenses and decisions need to be monitored.  If questions are raised, the program needs to be evaluated to determine if more clarity can be added.

Want to learn more?

On Thursday, October 20th, our monthly policyIQ CPE event will explore how you can use policyIQ to implement and monitor an effective anti-corruption program.  Register now to join us at 3 PM ET / 12 PM PT.

Resources Global Professionals also has compliance experts in your local area that can help you to evaluate your existing anti-corruption program, and determine whether you have all of your bases covered.  Contact us and we’ll  put you in touch with experienced compliance professionals.

This entry was posted in Industry News, Solutions by Chris Burd. Bookmark the permalink.

About Chris Burd

Chris is the Managing Director of the policyIQ group at RGP. She gets geeky about compliance and technology, and gets to spend every day working at the crossroads of the two. With policyIQ since 2005, Chris has worked with hundreds of policyIQ clients to implement technology and enhance their internal compliance environment. In the past few years, she's focused on enhancing policyIQ's offering as a Conflict Minerals and Anti-Corruption tool. In past lives, Chris worked as a system implementation consultant, a e-commerce specialist, a customer service call center manager, and - for one short but memorable summer during high school - a machine operator on midnight shift in a plastics factory. In her free time, she spoils her nieces, volunteers at her local food bank, and spends more time than she should taking photos of her cats. She would like to be a rock star when she grows up.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s