Instances of bribery or corruption can have severe consequences, including reputational damage, financial penalties, and legal liabilities. Organisations of all sizes should have processes in place to mitigate the risks of bribery and corruption.
Understanding bribery and corruption
Before delving into the specifics of an ABC policy, it is crucial to understand the concepts of bribery and corruption.
- Bribery involves offering, giving, receiving, or soliciting anything of value to influence a person in their official capacity.
- Corruption, on the other hand, is a broader term encompassing various illegal or unethical acts, such as embezzlement, fraud, and extortion.
The UK has a robust legal framework in place to combat bribery and corruption. The Bribery Act 2010 is the primary piece of legislation that governs these offences. The Act covers both domestic and international bribery, making it applicable to UK businesses operating globally.
Key anti-bribery and corruption policy components
An effective ABC policy should be designed around the following considerations to be successful:
Statement of purpose
The policy should clearly outline your objectives, such as preventing bribery and corruption, promoting ethical business conduct, and complying with relevant laws and regulations. It should aim to deter bribery and corruption by establishing clear guidelines and expectations for employees, contractors, and business partners.
Any anti-bribery policy should also include mechanisms for identifying and reporting potential instances of bribery and corruption, such as internal reporting channels and financial controls.
Clear scope
Define the policy scope clearly, specifying which individuals and entities are covered by its provisions. It should apply to all employees, regardless of their position or level of seniority as well as any contractors and suppliers.
There should be language covering subsidiaries and affiliates, joint ventures and partnerships, outlining the responsibilities of each party in preventing and addressing bribery and corruption.
Prohibited conduct
Explicitly prohibit various forms of bribery and corruption, including offering, giving, receiving, or soliciting bribes, as well as engaging in fraudulent or corrupt practices. Clarify the organisation's stance on facilitation payments, ensuring that they are only made in accordance with applicable laws and regulations.
Due diligence
Organisations must conduct due diligence on business partners, suppliers, and other third parties to assess their risk of involvement in bribery and corruption.
A policy on this should outline the procedures for assessing the integrity and reputation of third parties, including background checks, reference checks, and due diligence investigations.
Take appropriate measures to mitigate risks associated with high-risk third parties, such as implementing additional controls or terminating the relationship, as well as rigorous ongoing monitoring.
Gifts and hospitality
Set limits on the value of gifts and hospitality that can be accepted or given, ensuring that they are not excessive. The policy should prohibit gifts and hospitality that could create a conflict of interest or compromise the organisation's impartiality.
Employees should report any gifts or hospitality received, regardless of value, to their supervisor or compliance officer.
Financial reporting
Maintain accurate and transparent financial records to prevent and detect bribery and corruption. Your policy should specify the types of financial records that must be maintained, such as accounting records, expense reports, and invoices.
Implement strong internal controls to prevent and detect financial irregularities, mandating regular audits of your financial records to ensure accuracy.
Training and awareness
Mandate regular training and awareness programmes for employees to educate them about the risks of bribery and corruption and to reinforce your commitment to ethical business practices.
Any training should be tailored to the specific roles and responsibilities of employees, ensuring that they receive the information most relevant to their job functions.
Reporting and investigation
Provide a clear mechanism for employees to report suspected cases of bribery and corruption without fear of retaliation. Your policy should also outline the procedures for investigating such reports and taking appropriate disciplinary action.
Outline the procedures for investigating reported incidents, including the appointment of investigators, the collection of evidence, and the interviewing of witnesses.
Record keeping
Maintain records of any anti-bribery and corruption activities, including training records, due diligence assessments, and investigations. However, it’s key to communicate the required retention periods for various types of records, ensuring that they are retained for a sufficient period to meet legal and regulatory requirements.
Records should be easily accessible to authorised personnel for review and audit purposes but clear on the handling of sensitive information contained in ABC records.
Implementing an anti-bribery and corruption policy
Implementing an ABC policy requires a structured and systematic approach. Here is the process you’ll need to follow:
- Assessment
Conduct a thorough assessment of the organisation's current level of exposure to bribery and corruption risks. This can involve reviewing existing policies, procedures, and controls, as well as conducting interviews with key personnel. - Policy Development
Based on the assessment, develop a comprehensive ABC policy that addresses the identified risks and complies with applicable laws and regulations. - Communication
Communicate the policy to all employees, ensuring that they understand its importance and implications. - Training
Provide training to employees on the policy's contents, the risks of bribery and corruption, and the procedures for reporting suspected incidents. - Implementation
Implement the policy's requirements, including conducting due diligence on business partners, establishing financial controls, and reviewing gift and hospitality policies. - Monitoring and Review
Regularly monitor compliance with the policy and review it periodically to ensure that it remains effective and aligned with the organisation's evolving needs.
Managing an anti-bribery and corruption policy
Once implemented, an ABC policy requires ongoing management to ensure its effectiveness. This includes:
- Keeping requirements up to date: Regularly review the policy to ensure that it remains relevant and up-to-date with changes in legislation and best practices.
- Knowledge sharing: Provide ongoing training and awareness programmes to reinforce employees' understanding of the policy and its importance.
- Prompt investigation: Promptly investigate any reported or suspected cases of bribery and corruption, taking appropriate disciplinary action where necessary.
- Record management: Maintain accurate and up-to-date records of ABC activities, including training records, due diligence assessments, and investigations.
- Scheduled due diligence: Conduct due diligence on business partners and suppliers, and monitor their compliance with the organisation's ABC requirements.
Want to learn more about anti-bribery compliance?
We have created a comprehensive bribery & corruption roadmap to help you navigate the compliance landscape, supported by several financial crime prevention courses in our Compliance Essentials Library.
We also have 100+ free compliance training aids, including assessments, best practice guides, checklists, desk aids, eBooks, games, posters, training presentations and even e-learning modules!
Finally, the SkillcastConnect community provides a unique opportunity to network with other compliance professionals in a vendor-free environment, priority access to our free online learning portal and other exclusive benefits.
