So in the absence of any clear guidance, how do firms go about preparing for the Act? It’s important to look out for ‘danger signs’: these may seem obvious, but in practice they may be difficult to spot, especially as the Ministry of Justice will take a tough line on acts of bribery performed by ‘associated persons’ including contractors or sub-contractors.
MT asked Monitor Quest’s Jonathan Joffe for his advice on getting your business ready for one of the biggest changes to UK business law for a generation.
1. Look for the signs
Typical red flags include: dealings with state-owned enterprises, businesses with unclear ownership structures, organisations going through bankruptcy proceedings or which have had negative publicity linked to their finances.
2. Decide whether it’s a red flag or a red herring
A red flag in one country or sector can be common practice in another. For example, a business registered to a PO Box in the UK would give prospective partners cause for concern but this is widespread practice in many parts of the Middle East.
3. Don’t rely on suppliers’ own references
It’s difficult to corroborate whether a supplier’s references are unbiased. So take matters into your own hands - conduct your own independent enquiries with other clients, associates, former employees, market peers and, where possible, regulatory bodies.
4. Assess how exposed your employees are
Look at each employee’s situation, especially factors such as geographical location, the sectors they operate in and any partnerships they have. Obviously certain countries and sectors entail a higher risk of bribery.
5. Identify politically exposed people
Look for any business dealings your firm has had with people who have had a political career or those related to politicians. The nature, scope and relevance of the exposure must be analysed, recorded and reviewed.
6. Don’t rely on internet research alone
Conducting internet research is a quick, low-cost solution but it has limitations. Online data, such as sanctions or embargo lists, can often be outdated or inaccurate.
7. Cast your net wider to get the broader picture
In the UK, free databases like the insolvency register can be used to extend your research. While other databases like the Companies House register and consolidated global news sources provide a wealth of information which can be cross-referenced.
8. Seek out native language records and media
If a particular red flag is high risk then don’t rely on English-language records and media outlets alone. Search foreign records and media, and if a reliable translation isn’t available then find a native speaker who can help.
9. Get an independent view
Seeking independent, expert advice will give increased credibility to your internal procedures. Plus, if a red flag is identified they will be able to provide solutions to deal with the issue.
10. Conduct regular reviews
These top tips are just the start. The Bribery Act and the Ministry of Justice’s Guidance place emphasis on keeping internal anti-bribery procedures and records up to date. Remember: a longstanding business relationship with a subcontractor or agent doesn’t rule out the need for regular reviews.
- Jonathan Joffe is CEO of the risk management and strategic intelligence services company Monitor Quest