Bribery – or extortion?

It has been said that British companies are unprepared for the rules likely to be implemented this October under The Bribery Act. Under its harsh code there are offences of bribing a foreign official as well as general offences of making or receiving bribes. Penalties will include longer jail sentences (up to ten years). In addition, companies can be prosecuted if they do not have adequate anti-corruption systems in place. Convictions took place in the past only where it could be proved that bribes were paid at the direction of senior managers. This will no longer be the case.

As yet, guidance has not been given on what procedures need to be in place or on what constitutes bribery. I think we should be told.

This is all very well, but it is very tricky area. I can remember once when one senior oil industry figure was under the cosh on a bribery allegation, he made the defence that his company did not want to bribe anyone to get a contract, but that all those companies competing (it was for a Nigerian contract) were expected to participate in the bribery bid as well as the contract bid. He said, quite fairly in my view, that it was not bribery but extortion.

And where does what constitutes a bribe actually begin, never mind where does it end? The Times, in an online poll, recently asked what business thought of things, amongst others, like – a corporate golf day, a trip to the Cheltenham Festival, tickets to a Six Nations Rugby game or a trip to the Opera. If these are bribes, then I for one am guilty of having taken them. Did it affect my decision-making. Not a bit.

Clearly though, it is the payment of ‘wonga’ or ‘bungs’ that really is the target, and where it happens, corruption is usually rife. Maybe there is a case for a stricter anti-bribery code to apply in transactions between UK companies, but otherwise it is better to allow local laws to apply (and these will be different in the US than they are in, say, Somalia ).

You can rest assured that if this legislation comes to fruition, it will not be at all helpful to raising ethical standards in the UK or elsewhere. All it will mean is that UK companies operating in very difficult overseas territories will not stand a chance of getting the contracts that are up for grabs.

Published on May 04, 2010 by Neil Thomas