Adequate Procedures

A company's senior management cannot guarantee to prevent bribery in all circumstances. But, a commercial organisation will have a full defence if it can show that despite a particular case of bribery it nevertheless had adequate procedures in place to prevent persons associated with it from bribing. The standard of proof which the commercial organisation would need to discharge in order to prove the defence, in the event it was prosecuted, is the balance of probabilities.

The Bribery Act defence will be available where senior management can demonstrate the operation in practice of 'adequate procedures', reflecting the following principles:

• Risk-based and proportionate; being clear, practical, effectively implemented and enforced.
• Senior management commitment to preventing bribery by associated persons.
• Understanding the actual bribery risk (e.g. via documented risk assessment).
• Risk based due-diligence (i.e. in respect of persons who represent the company/firm).
• Bribery prevention policy and procedure embedded throughout the organisation.
• Training and awareness for management, employees and associated persons.
• Monitoring and reviews of procedure, to identify and prevent bribery risk.
• Responding proactively to identifiable risk and making improvement, where necessary.

See also:

The Bribery Act 2010
Associated Persons
The Regulator
Law Enforcement
Risk in current operations
Risk in new ventures and acquisitions
Red-Flags

An effective Compliance Programme reduces corruption risk when designed to prevent and detect violations or breaches before they occur. Such programmes include:

• Tone from the top - High level Policy Statement or Code of Conduct endorsed by senior management.
• Guidance - Compliance Manual with written standards and guidelines for all employees, contractors, agents, etc,.
• Accountabilty - Designated senior manager responsible for oversight, monitoring and compliance arrangements.
• Education - Training and awareness for directors, management, employees and relevant contractors / agents.
• Alert mechanism - Confidential telephone hotline for reporting details of suspected breaches.
• Assurance - Independent reporting to Senior Management (i.e. The Board) and the Audit Committee (e.g. Results of Internal Audit reviews/compliance-based testing).

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