Can a Christmas gift break the law?

Iskander Fernandez shares anti-bribery compliance tips to prevent employers getting into trouble this festive season

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From a bottle of whisky at Christmas to cup final tickets in the corporate box, gifts from clients have long been considered a perk of some jobs. Freebies offered to try and improperly influence business decisions, however, are a different and potentially criminal matter; a distinction made clear in the Bribery Act 2010.

An extreme example of the consequences of crossing the line hit the headlines earlier this year when Noel Corry, a former Coca-Cola Enterprises manager, admitted to accepting more than £1.5m in bribes from senior managers at favoured companies in exchange for lucrative contracts. Not only were the individuals prosecuted but, in a first for the Metropolitan Police, the businesses in question were also charged and convicted of failure to prevent bribery. The contracting companies should have had in place compliance measures that would have prevented the payments, detectives said.

It showed that awareness is no longer enough. An organisation defending itself against allegations of bribery must also be able to show that it had adequate procedures to prevent behaviour of this nature happening in the first place. 

Rule of six

Employers often don’t but should refer to the following six key principles, as issued by the Ministry of Justice, when drawing up anti-bribery procedures: 

  1. Proportionate procedures

Both bribery prevention policies and the procedures for implementing them should be proportionate to the nature, scale and complexity of an organisation’s activities and the level of risk it faces – SMEs, for example, will face different challenges to large multinationals. 

  1. Top-level commitment

Whatever the size or structure of an organisation, the tone from the owners, board of directors or equivalent should be one of total commitment to stamping out bribery so the message is clear to all. 

  1. Risk assessment

Organisations should regularly assess potential bribery risks. It will not be enough to simply have a policy in place if that policy has not been benchmarked or if it has not been revisited; for example, if the organisation enters a new market or jurisdiction in which it has not done business before.

  1. Due diligence

Due diligence is a vital part of good corporate governance and can encompass a wide range of business relationships, from employees and contractors to third parties. It should, however, be proportionate, so an organisation seeking an intermediary to establish a business in foreign markets, for example, may demand a much higher level than that of a company contracting for IT services. 

  1. Communication

Organisations should ensure that policies and the penalties for breaching them are clear and readily accessible to staff, including regular training to aid understanding and help identify any issues at an early stage. 

  1. Monitoring and review

Monitoring and evaluating the effectiveness of an organisation’s anti-bribery policies will ensure they remain relevant and valid. It also doesn’t need to be overly complex; for example, it could be done via a simple staff survey.

A common sense approach

Common sense and a consideration of how something might be perceived are often the best approaches when determining whether something could be construed as a bribe. An organisation due to tender for work being offered the corporate box at Wembley from an interested party, for example, would be very different to the offer of a lunch to say thanks for a job well done. 

As Corry found when paying Coca-Cola back the £1.7m he owed, the penalties versus the payoff can be huge. Tempting though it may be, transparency is key, and it is incumbent on employers to lead by example and make sure they set clear guidelines to keep everyone on the right side of the law.

Iskander Fernandez is a partner and head of the white collar crime and investigations team at Kennedys