With enforcement of the United Kingdom's Bribery Act just over two months away, a new survey suggests many companies don't yet have their ducks in a row when it comes to revising their compliance programs. In some cases, affected businesses may not even know where their ducks are.
Deloitte Financial Advisory Services LLP announced Wednesday that 78 percent of business professionals polled during a recent webcast anticipated greater global anti-corruption enforcement in the next year. Startlingly, 73 percent of the more than 1,000 business professionals surveyed said they aren't yet familiar with the provisions of the U.K.'s sweeping legislation.
"When we saw these results, our eyebrows went up a bit," says Joe Zier, a leader in Deloitte's Foreign Corrupt Practices Act consulting services practice. "It's surprising and a little troubling," he says.
The mostly United States-based pool of respondents came from a range of industries, including financial services, consumer and industrial products, and banking and security. The poll was conducted earlier this year during a Deloitte webcast focusing on compliance with the FCPA in Brazil, Russia, India and China.
When asked whether they had an effective anti-bribery program in place, less than a quarter (24 percent) of respondents replied in the affirmative. The largest category of business professionals (34 percent) indicated that their programs could be improved upon. Nineteen percent admitted that their compliance programs were ineffective, and 21 percent said that they didn't know.
"The audience is saying, 'Not only don't we know what we have in place, but we don't think it's effective,'" says Zier.
If companies don't act fast, he says, "They're going to get into trouble starting this summer." The new law goes into effect July 1. According to Zier, now is the time for boards, chief executives and senior management to focus on refreshing their anti-corruption compliance programs and expanding those programs beyond what is required by the FCPA.
While there is substantial overlap between the two laws, the Bribery Act ups the ante for companies that carry on business going through the U.K. Zier says some of the more challenging provisions for businesses are due diligence with respect to third parties and a requirement that companies take into account corruption levels from region to region.
If employees are working in a high-corruption area, their companies will need an enhanced plan for that specific locale. The "proportionality" requirement of the Bribery Act will require companies to take a surgically tailored approach to their programs, says Zier.