- 40% of UK businesses surveyed think the current economic climate is encouraging risk taking around compliance with the UK Bribery Act
- 27% do not believe the government will prosecute offenders
- 25% of board-level employees surveyed might breach Bribery Act regulations to win business
- 63% of respondents believe the UK Bribery Act eventually will have a positive effect on prospects for UK business
London, 3 October 2012 — UK businesses still are taking risks in compliance with the UK Bribery Act in the pressure to win business and the belief that regulators will hold back from prosecutions, according to the latest research from FTI Consulting, Inc. (NYSE: FCN), the global business advisory firm dedicated to helping organisations protect and enhance their enterprise value.
The research, which surveyed 571 board-level and senior and middle management respondents in UK companies, finds that 40% of businesspeople believe the current economic climate is encouraging organisations to risk breaching the UK Bribery Act in order to win business, while just over a quarter (27%) do not believe the government will encourage regulators to pursue prosecutions in the current economic environment. A further one in five (21%) believe they will not be prosecuted for a breach of the Bribery Act, and a third (31%) believe the act exists mainly for appearance’s sake and ethical guidelines.
Worryingly, the FTI Consulting research reveals that risk taking seems to come from the top down. A quarter (25%) of board-level respondents confess they might breach the Bribery Act in order to win business compared with 16% of middle management.
While many businesses admit to cutting corners in creating the right processes and protocols to comply with the Bribery Act, there does seem to be overwhelming support for the long-term eradication of corporate corruption. Two thirds (63%) of respondents to the FTI Consulting survey say that the UK Bribery Act eventually will have a positive effect on prospects for UK business.
John Higgins, leader of the EMEA Ethics and Compliance Advisory team at FTI Consulting, commented: “One year after the Bribery Act came into effect, we wanted to understand how businesses have responded. Our research shows that while most leaders want ethical business practices, many organisations still face the challenge of managing a hard core of risk takers — and we see evidence of the disproportionate damage they cause in the news every week.”
Julian Glass, Managing Director in the Forensic and Litigation Consulting practice at FTI Consulting, said: “The Serious Fraud Office [SFO] has consistently stated that it will pursue companies that breach the Bribery Act and do not have the right procedures in place to prevent bribery and corruption occurring in the organisation. Yet in the absence of a major prosecution, and in light of the increasing need for UK companies to grow business in emerging markets, there are a significant number of business leaders and managers prioritising winning business over fully complying in the belief they will be safe from prosecution.
“This research highlights the need for organisations to continue to work on both top-down cultural change and implementation of substantive compliance programme measures,” Glass continued. There is no room to allow complacency or to see anti-corruption compliance as a finished project. The corporate world has done a great deal to address anti-corruption, but companies can’t rest on their laurels. The likely implementation of deferred prosecution agreements will give the SFO another tool in its armoury to penalise compliance failures and encourage sustainable behavioural change.”
The FTI Consulting research also shows there is concern about the impact the Bribery Act will have on competitiveness, particularly in the BRICs (Brazil, Russia, India, China) countries. Although eight in 10 (80%) of respondents think UK businesses should boost trade with growing economies such as BRICs rather than in the eurozone, approximately half think it would be difficult to effectively conduct business in those countries and still adhere to the UK Bribery Act legislation.
Russia is perceived to be particularly difficult at 57%, followed by India (52%), China (51%) and Brazil (48%). Nearly three in 10 (28%) of board-level employees responding already believe the Bribery Act has caused them to lose foreign business.
About the Research
Research was conducted online by the Strategy Consulting and Research team at FTI Consulting from 13 to 17 July 2012 with 571 executives in UK businesses in board-level, senior management and middle management positions. Respondents are drawn from affiliate panel databases. Company size is as follows: Respondents totalling 327 are from medium-sized companies (those with between 50-250 employees), and 244 are from large companies (those with more than 250 employees). Respondents totalling 384 come from companies that are headquartered in the UK only, 103 from companies listed on the UK stock exchange, 82 with headquarters outside the UK and 2 were unclassified.
About FTI Consulting
FTI Consulting, Inc. is a global business advisory firm dedicated to helping organisations protect and enhance enterprise value in an increasingly complex legal, regulatory and economic environment. With more than 3,800 employees located in 24 countries, FTI Consulting professionals work closely with clients to anticipate, illuminate and overcome complex business challenges in areas such as investigations, litigation, mergers and acquisitions, regulatory issues, reputation management, strategic communications and restructuring. The company generated $1.56 billion in revenues during fiscal year 2011. More information can be found at www.fticonsulting.co.uk.