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Small bribes, big problem: new guidance for companies

New guidance for companies on countering small bribes has been published by Transparency International UK, with support from DLA Piper and FTI Consulting.

Transparency International’s new guidance for companies, Countering Small Bribes: Principles and good practice guidance for dealing with small bribes including facilitation payments provides practical advice on addressing the challenge of countering small bribes including “grease payments”. It is also designed to be of assistance to regulators law-makers, prosecuting agencies and professional advisers.

Countering small bribes is a complex challenge for companies. Transparency International research shows that globally, more than 1 in 4 people paid a bribe in a recent 12 month period, highlighting the scale of the problem facing companies. Demands most often occur in overseas markets, where employees may be vulnerable through travelling alone or the company needs to release critical goods from customs.

‘When a company pays a bribe of any size, it reinforces a culture of graft which is exceptionally damaging to the economies and societies in which they are paid’ said Robert Barrington, Executive Director of the country’s leading anti-corruption organisation, Transparency International UK.

‘A British company paying serial bribes to government officials in the UK would be rightly vilified. Citizens of other countries feel equally strongly about such law-breaking. These bribes are not so small when added together – in a single year, a company might be paying out millions of dollars around the world. But nobody doubts that there are parts of the world in which it is hard to do resources-resources-business without facing sometimes frequent demands for small bribes. This is one of the most difficult corruption problems for companies to eliminate in their operations.

‘We have drawn on our experience in working in over 100 countries and with dozens of global companies to provide guidance that will help companies eliminate small bribes, at the same time protecting their reputations and staying within the law.’

Simon Airey, Head of Investigations at DLA Piper, added: ‘There are very few multinational companies that aren’t at risk of extortion or aren’t affected by small bribes and facilitation payments to some extent. Often those payments are concealed from the company by its employees or they are paid covertly by agents and intermediaries. However, that isn’t a defence under the legislation and it doesn’t matter that individual payments are low in value. Small payments can give rise to big problems for companies with international operations. This guidance will help companies to reduce their exposure significantly.’

Julian Glass, a Managing Director at FTI Consulting expanded on this by saying ‘Small bribes and facilitation payments have long been an area of risk that has caused companies concern. The widespread demand for these types of payments, combined with the difficulty in detection makes their eradication a real problem. We hope this guidance will help companies to understand good practice in dealing with this difficult issue.’

The guidance provides a set of principles, discussion and advice designed to help companies operate to high ethical standards, protect their reputations and fulfil their legal obligations. It contains:

  • 10 principles for countering small bribes
  • A section on assessing risk
  • Practical examples & case studies
  • Model negotiation steps for resisting demands
  • A self-assessment checklist aligned to the ten Principles and good practice set out in the guidance
  • Information on the US FCPA Act


Read 2828 times Last modified on Tuesday, 24 November 2015 12:18

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