Building a relationship or giving a bribe?

The laws on bribery in the USA have been quite strong for around 10 years and have changed the way large global companies have viewed corporate gifts and “facilitation” fees. One company I worked with went as far as mandating that their strict anti-corruption policy on this would be posted in the main reception of all their buildings – something they did not do for any other policy.

From April 2011 (Ministry of Justice and Serious Fraud Office readiness allowing) and following consultation on the regulations, the UK Bribery Act 2011 will apply to any business that has any part of its operation in the UK. The international business press have started running pieces to tell Finance Directors, Corporate Lawyers and Compliance Officers that the chances of getting caught because the regulators and investigators (like the Serious Fraud Office) now have legal ways encouraging them to share data and cooperate.

Corporate hospitality and gifts can still be used to build relationships but must not influence decision-making. That is another thing on the agenda for the risk assessment on a project – and it must not be confined to the actions of the project. Could a short discussion with a guest from your potential buyer about your project in the company’s box at the football be a risk to your project? Could one of your suppliers be operating close to the line on “you scratch my back, I’ll scratch yours” and so at greater risk of being investigated, disrupting your supply? Could a celebration event with an external stakeholder be misinterpreted as trying to influence their decision?

The best way to avoid problems is by being very clear about policies for anti-corruption; procedures and practice guidance for lobbying, hospitality and negotiations; a clear code of ethics; and individual accountability.

The checklist from the Serious Fraud Office may help. This checklist, useful webcasts and more can be found at http://sfo.gov.uk/bribery–corruption/

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