Ethical conduct and the prevention of corruption should be of paramount importance to all companies, regardless of whether they operate in countries with strong anti-bribery laws or not. Organisations of all sizes are realising that corruption and bribery can dent their competitive advantage, increase costs and impede growth. According to Transparency International, companies are now becoming more open about their anti-corruption efforts and anti-bribery standards for five key reasons:
- Transparency is the new normal and is expected by the marketplace
- Anti-bribery and corruption programmes have been consistently seen as measures correlated with good company performances
- Countering corruption and being open can have a positive influence on a business’s bottom line
- Increased transparency is a good means to flag corruption risks
- Transparent reporting on anti-corruption programmes can lead to better overall corporate compliance with regulations
Companies with an effective anti-corruption policy or anti-bribery procedures benefit from risk reduction, cost savings and sustainable growth while helping to level the playing field for all. It also demonstrates a company’s response to the legal obligation and responsibility to reduce the risk of corruption while also representing a commitment to operating a clean business.
What should be included in such a programme? It should typically encompass elements such as a statement of values, risk management measures, internal and external communication policies, training and guidance, internal controls, oversight mechanisms, assurance measures and a code of conduct.
Companies that demonstrate efforts to reduce the risk of bribery and corruption through such measures are increasingly treated favourably under national laws in the United Kingdom and other countries such as the United States and Brazil. Legislation allows for reductions or even the suspension of penalties imposed on companies if they have put strong anti-corruption practices into place.
Cost savings are generated by being up front and transparent about anti-bribery and corruption efforts. The market tends to attach a higher value to companies that are honest with stakeholders such as investors and this can in turn lead to favourable risk evaluations resulting in better access to capital, lower interest rates for borrowing or a higher stock price valuation. Operational costs can also be reduced due to streamlined internal processes that address operational weaknesses leading to cost reductions.
Anti-corruption programmes and transparency also allow organisations to gain access to preferential treatment such as commercial advantages offered by public institutions or private business partners such as favourable payment terms or lower due-diligence requirements.