A brief segment on BBC radio this morning brought an imminent piece of UK legislation to our attention. The planned UK Bribery Bill, which has cross-party support, will attempt to bring UK legislation in line with OECD commitments that the country made some time ago. One effect will be to make companies criminally liable for breaches of the planned legislation subject to an “adequate procedures” defence, which would be reliant on demonstrating thoroughly communicated polices, training, due diligence, internal audits, and so on.
Law firm Eversheds recently engaged with 694 executives to gauge their knowledge on the issue. The firm concluded that as well as a general lack of awareness, many businesses simply do not have policies and systems in place to avoid, or deal with, corrupt business practices.
Eversheds have suggested that organisations that cannot demonstrate “adequate procedures” will have less of a defence in the case of relevant legal action. The indications are also that the planned legislation will encompass breaches by the company’s agents, not just the company itself.
Consequently, we believe that it is therefore a good idea for companies, particularly organisations that operate in parts of the world where these issues present a significant risk, to ensure that they have put in place the required systems and policies. We also think it is important that they clearly demonstrate this to their internal and external audiences.
Some organisations have made significant efforts to make this kind of information transparent and accessible. Two good examples can be found at the websites of CRH and BHP Billiton. On the other hand, there are plenty of corporate websites and reports that contain no mention of a code of conduct, relevant policies or management systems (such as whistle-blowing procedures). As such, we believe that there are a significant number of organisations that, despite the adoption of the related policies and systems, are still leaving themselves exposed because of a lack of communication.
