In enacting the Foreign Corrupt Practices Act, Congressional leaders stated that the FCPA “would end corporate bribery” and that the goal of the FCPA was “the elimination of foreign bribery.”
Granted, politicians have long been known for making optimistic, aspirational statements, but 40+ years later there is more, not less, FCPA enforcement activity, and seemingly more, not less, exposure to corruption in the global marketplace. (For additional reading on this general topic – see here for the article titled “Has the FCPA Been Successful in Achieving Its Objectives” recently published in the Illinois Law Review).
Recent survey results from the 2019 Global Anticorruption Survey by AlixPartners once again seriously call into question whether the FCPA has been successful in achieving its objectives.
The survey “polled more 300 senior executives – corporate counsel, legal, compliance, accounting/finance, and purchasing/procurement professionals representing more than 20 industries in North America, Latin America, Europe, and Asia in August to September 2019.”
Among the survey results:
- 94% of respondents say their industry is exposed to corruption risk, and almost 40% of those say they view the risk as significant.
- 51% of respondents believe their company has lost business as a result of a situation involving illicit payments to a government official.
- 73% of respondents said “It’s just NOT POSSIBLE to avoid corrupt business practices in certain areas.” (emphasis added).
Survey respondents were asked “Where is it IMPOSSIBLE to avoid corruption” (emphasis added) and 37% said Africa, 30% said the Middle East, 28% said Brazil and 27% said Russia.
These survey results seriously call into question whether the FCPA has been successful in achieving its objectives.
Another interesting aspect of the survey concerns whether compliance professionals feel like they have the tools necessary to do their jobs.
As stated in the survey, “survey respondents said that if they had a larger budget, digital tools would be among their top two purchases, second only to conducting more frequent risk assessments.”
81% of respondents said lack of IT systems and software to help monitor for fraud and corruption is challenge.
Nearly 20% of respondents have NEVER conducted an antibribery or anticorruption risk assessment or benchmarking review of their compliance policies. (emphasis added).
Perhaps if the FCPA itself or FCPA enforcement policy better incentivized these expenditures the survey results would be differ. (See this prior post among numerous other posts on these pages for how an FCPA compliance best can best incentivize corporate compliance).