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Bribery Act one year on – ‘risk takers and dangerously ignorant’ threaten companies

FTI Consulting this week announced the results of its research into U.K. business leaders’ perception of the Bribery Act. While no one expected the new law to immediately eradicate bribery by U.K. businesses, what’s surprising is the number of business people who freely admit they would flout the rules to win business.

Almost two thirds of the respondents to the FTI survey think the Bribery Act will be positive for U.K. business in the long term, but in the short term they see difficulties balancing compliance and export growth.

A quarter of board members said they would break the law to further business interests. About half are concerned about immediate business prospects in the BRIC countries if they refuse to pay bribes.

A substantial minority (one in four) can still be characterized as “dangerously ignorant” when it comes to the Bribery Act. A startling one in eleven managers were both dangerously ignorant and regarded themselves as responsible for compliance within their business.

Almost a third of managers are bribery “risk-takers” — reasonably aware of the legal requirements but still prepared to risk a breach for business advantage. Arguably a group that knows the rules but chooses to ignore them does so because they find it morally acceptable, perhaps in the way many people considered drinking and driving acceptable — if illegal — a few decades ago.

While one in seven know or suspect their business made facilitation payments in the past year, only one in four companies has a facilitation payments policy in place. Although many cases of corporate liability arise through the actions of business partners (suppliers, agents, etc.) almost one third of companies still have no policy on third party selection, and over one fifth do not intend to implement one.

The survey was conducted before the announcement of the U.S. IRS $104 million reward paid to a whistleblower. But one in four claimed they would report a former employer and a similar number would report a competitor directly to an external regulator or enforcement agency. The IRS reward announcement can only increase this proportion.

Simply put, companies must practice what they preach. People judge their managers’ and leaders’ real priorities by where they spend their time and effort. So leaders who talk ethical business but spend all of their time when making business decisions or assessing personal performance based only on financial concerns are telling their teams that money, not ethics, is what really matters.

The full survey results can be viewed here.


John Higgins leads the FTI Consulting ethics and compliance team based in London. He has over 20 years’ international experience in governance, risk and compliance advisory work. He can be contacted here.

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