The UK Bribery Act guidance is out and the reaction has
been across the board. Here is just a sampling of it. Mike Volkov, in the FCPA Blog brought up Yogi Berra by noting,
"If you don't know where you are going, you might wind up someplace else."
He used this quote to lead into a piece entitled, "Life
after Guidance: No Change". This complimentary use of an American icon,
whose use of the English (American version) language is legendary stands in
contrast to Bill Waite, a founder of The Risk Advisory Group, also writing in
FCPA Blog, went further and termed the guidance "questionable".
Jim McGrath, writing in his Internal
Investigations Blog, says that companies subject to the Bribery Act had
better "put on a (crash) helmet" for it may well be a bumpy ride. Even the Wall
Street Journal got into the act, with an article entitled, "Britain
Backpedals on Bribery Act."
However all of these pundits pale next to the skewering
given the Guidance by our colleague Howard Sklar, who is working through the
Case Studies on his OpenAir Blog.
They make for great reading by the way, so head on over to the Open Air Blog
with a tall "cool one" and watch him skewer the Case Studies and then enjoy "Bar-Be-Que
Case Studies ala Howard". You should note that Howard has promised that
"I'm going to write my own version of the Guidance. The guidance as it should
have been written." That, my friends will be well worth the wait.
However we do not feel that the Guidance deserves quite
so harsh a judgment and indeed welcome the Guidance. The reason is that we
welcome any interpretation of new legislative from one of the world's strongest
anti-bribery and anti-corruption regimes; as it puts into the hands of
compliance professionals information on current best practices of an
anti-bribery and anti-corruption program. We believe that the Guidance fulfills
that mission. In this posting we will set out the Six Principles and in
subsequent postings we will discuss each Principle in detail.
The Guidance provides valuable information on not only
what the UK Ministry of Justice considers a best practices program but it is
also a benchmark by which any US compliance practitioner can use to assess
their company compliance program. Further they are not, as Lanny Breuer has
suggested, "formulaic" but are intended to be "flexible and outcome focused."
With this in mind, we set out the Six Principles listed in the Guidance.
I. Proportionate Procedures-A
company's procedures to prevent bribery by persons associated with it should be
proportionate to the bribery risks it faces and to the nature, scale and
complexity of the commercial organization's activities. They are also clear,
practical, accessible, effectively implemented and enforced.
II. Top-Level Commitment-the
top-level management of a company, be it a board of directors, the owners or
any other equivalent body or person must be committed to preventing bribery by
persons associated with it. They foster a culture within the organization in
which bribery is never acceptable.
III. Risk Assessment- a
company should assess the nature and extent of its exposure to potential
external and internal risks of bribery on its behalf by persons associated with
it. The assessment is periodic, informed and documented.
IV. Due Diligence-a
company should apply due diligence procedures, taking a proportionate and risk
based approach, in respect of persons who perform or will perform services for
or on behalf of the organization, in order to mitigate identified bribery
V. Communication (including training)-a
company should seek to ensure that its anti-bribery and anti-corruption
policies and procedures are embedded and understood throughout the organization
through internal and external communication, including training, that is
proportionate to the risks it faces.
VI. Monitoring and Review-a
company should monitor and review its procedures designed to prevent bribery by
persons associated with it and makes improvements where necessary.
So there you have it. Is it useless, good only for a
bar-be-que or make you want to put on a crash helmet? I hope not but even if it
does, please stay tuned for out next couple of segments on the Guidance.
Visit the FCPA Compliance and Ethics Blog,
hosted by Thomas Fox, for more commentary on FCPA compliance, indemnities and
other forms of risk management for a worldwide energy practice, tax issues
faced by multi-national US companies, insurance coverage issues and protection
of trade secrets.
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© Thomas R. Fox, 2011
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