Businesses in the UK are putting themselves at risk through a lack of awareness of the Bribery Act 2010, according to new research by Ernst & Young.
Under the new legislation, which came into force in July 2011, companies are required to take precautions to prevent staff members or suppliers taking or offering bribes.
A survey of 50 procurement managers at firms with turnovers ranging from £5 million to £50 million found that only half were aware that the Bribery Act existed. Businesses operating in the automotive and manufacturing industries were particularly ignorant of the legislation, said Ernst & Young.
A clear North-South divide was also observed with almost three quarters of Northern firms unaware of the Act, while 72 per cent in the south of England have heard of it. Meanwhile, larger firms had a greater level of awareness than their mid-market counterparts.
The research also discovered that only 52 per cent of those businesses that are aware of the Act vet suppliers to ensure they are compliant.
It is clearly concerning that so many firms aren’t managing their bribery risk well over a year after the Bribery Act was introduced in the UK. We would encourage businesses of all sizes to consider their bribery risk during the procurement process and take steps to improve compliance in-house and among suppliers.
Ernst & Young partner John Smart explained that expanding businesses into new, developing economies brings with it new risks, alongside new opportunities. He said, “If the UK is to export itself back to growth, then this carries with it a whole raft of new risks, including bribery”.
“A robust review of the supply chain should be a key focus for businesses, as proper processes for vetting suppliers is required under the legislation.”