’Tis the season for gift-giving and, with it, a heightened likelihood for bribery and corruption risk.
According to a recent online poll of 1,600 professionals conducted by Deloitte, 20 percent of respondents said their companies don’t assess employee gift-giving corruption risk, and yet 43 percent said they expect anti-corruption enforcement to rise in 2016.
That’s especially concerning, given that red bows during the holiday season could mean red flags for regulators. “Giving gifts that could be seen as bribes to non-U.S. government officials can result in fines, regulatory action and brand damage for multinational organizations,” said Bill Pollard, Deloitte advisory partner for Deloitte Financial Advisory Services.
“Now is the time to conduct gift-giving compliance training and increase efforts to help ensure anti-corruption compliance through the holiday season,” said Pollard. “As global enforcement continues to increase, take a note from regulators and make sure your corporate records around travel, gifts and entertainment are transparent and show no ‘corrupt intent,’ particularly when out-of-country government officials are recipients.”
Poll results show that anti-corruption policies for giving gifts to non-U.S. government officials run the gamut, with 18 percent maintaining a no-gift policy and providing no gifts to customers, 16 percent giving only small company logo items, 15 percent restricting gift value and six percent using separate policies for non-U.S. government officials versus other customers and third parties.
Deloitte recommends a list of leading practices to prevent and detect corruption in gift giving. Compliance officers should be checking it twice:
Set ground rules clearly: Describe the nature and type of acceptable gifts, payments, travel and entertainment. Escalate all gifts for government officials to compliance for review. Create an approval process with aggregate dollar limits. Define disciplinary process for non-compliance.
Act globally: Ensure rules are consistent not only with US laws but local laws and customs. Translate that guidance into all appropriate languages in which your organization operates.
Keep gifts corporate: Give gifts with company logos, reflecting the organization’s products and ensure they are intended for official—not personal—use (e.g., business card holder).
Make gifting inclusive: Give gifts publically and transparently, involve teams as opposed to individuals (e.g., specialty baked goods for a team to share).
Prohibit cash like gift cards.
To uncover anomalies pointing to corrupt intent and bribes disguised in gift giving, some compliance, legal, and internal audit teams use visualization and analytics tools. However, just eight percent of respondents said their organizations use visualization and data analytics technologies effectively to support anti-corruption efforts. Another 33 percent said they don’t use the tools at all.
“Anti-corruption visualization and analytics tools can help address varied global anti-corruption laws and gift-giving customs, making multi-national anti-corruption management easier than before,” said Pollard. “But, nothing replaces the fundamental value strong anti-corruption professionals, policies and procedures do.”