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UK Bribery Act: how will you act?

Tanya Barman's picture

Last week the UK Ministry of Justice at last released the Guidance related to the UK Bribery Act 2010.  This guidance outlines procedures which commercial organisations can put into place to prevent persons associated with them from bribing.  As the guidance states victims of bribery not only include firms who lose out due to an unfair playing field, but also more generally governments and society globally pay a cost "undermined by a weakened rule of law and damaged social and economic development".

The Bribery Act 2010 modernised the UK law on bribery and will come into force on 1 July 2011. Central to the revised Act is that organisations may be liable for failing to prevent a person from bribing on their behalf.  What is critical in any defence is to show that adequate procedures are in place to prevent bribery.  If your organisation should be at risk you should ensure that awareness raising, relevant policies, risk assessment and due diligence together and related monitoring and review should all be reviewed, or if need be introduced.

For many firms, with commitment to anti-bribery business practice - particularly those with a "zero-tolerance" approach, the UK Bribery Act has often just entailed a revisit of what is in place.  For others it will entail ensuring that not only they have top-level commitment but relevant procedures and related ethical working culture in place. With a three month lead in - time is off the essence.

Survey

Bribery Act survey

At the end of 2010 CIMA surveyed its members to find out how prepared they were in relation to enforcement of the Act. The results of the survey Bribery Act: how will you act? showed that although the majority, 67% were aware of the Act, only 43% felt their company was prepared.  This may have been related to the delay in formal guidance being issued as 73% had already updated policies including anti-corruption and and anti-bribery procedures. 

Nearly a third of respondents saw their roles being directly affected by the new Act.  It is therefore no surprise that CIMA members recognised their responsibility not only in assessing risk, revising policies and reporting processes, but also in setting the ethical tone and raising awareness. Finance have a key role to play -  as one CFO stated "I will be deemed responsible for any breach in my area".

A key step which companies still needed to address was around the briefing and training of staff as well as related subsidiaries and agents.  For large multinationals who haven't already  established such practices (often those already responding to FCPA regulation) there is a  lot of work to do and CIMA members have a pivotal role in both implementation and messaging.

"I see my role as reinforcing the message of high ethical standards, providing advice and guidance to colleagues, ensuring financial controls are adequate and highlighting areas of risk exposure" -  Survey respondent

CIMA recognises that management accountants have a particular ethical responsibility to promote an ethics based culture that doesn't permit unethical practices. We will be exploring these issues furhter at an event at St Paul's Cathedral next week where CIMA, together with the Ministry of Justice, anti-corruption / ethical experts and finance professionals come together to discuss both the professional, financial and moral imperatives of fighting corrupt practices.

for further background see:

CIMA briefing paper on the UK Bribery Act
http://www.cimaglobal.com/briberyact

FM article on the UK Bribery Act and global corruption
http://www.fm-magazine.com/feature/depth/corruption-crackdown

CIMA Code of Ethics www.cimaglobal.com/ethics

Prosecution guidance has also been jointly issued by the Serious Fraud Office and the Department for Public Prosecutions.  http://www.sfo.gov.uk/press-room/latest-press-releases/press-releases-2011/bribery-act-prosecution-guidance-published.aspx

Transparency International,the world's leading anti-corruption non-governmental organisation released guidelines for adequate procedures in 2010 ahead of the delayed UK government guidelines.
http://www.transparency.org.uk/working-with-companies/adequate-procedures

How corrupt are the territories you operate in? See TI's global indices on corruption
http://transparency.org/policy_research/surveys_indices/cpi/2010/results

 

Eradication of Corruptions

Dear All,

The only way to eradicate corruption is to employ ppl with integrity judged by their family background, educational level and best of all provided with the right remuneration in view of the responsibility and amount of fund/spending authority given in capacity of the job concerned.

Another aspect is to have a government with a blend of 3 groups in the purchasing/treasury committee whereby majority votes decision takes place preventing One or FEW OFFICIALS making decision that affect the economy.

Common scenario whereby few good men make rotten decision that affect everyone.