This post summarizes two recent surveys: Fulbright & Jaworski’s Annual Litigation Trends Survey and Kroll’s Global Fraud Report.
Fulbright & Jaworski’s Annual Litigation Trends Survey
Fulbright & Jaworski LLP recently released its 8th Annual Litigation Trends Survey (available for download here).
Some FCPA / U.K. Bribery Act specific findings of note.
9% of U.S. companies and 6% of U.K. companies have “engaged outside counsel to assist with a bribery or corruption investigation in the past 12 months.” Last year the percentages were 12% and 26% respectively.
11% of U.S. companies and 20% of U.K. companies “have engaged in due diligence for bribery or corruption (including FCPA matters) relating to a merger, acquisition or other business transaction with a foreign country in the past 12 months.” Last year the percentages were 17% and 28% respectively.
12% of U.S. companies “foresee changes in the way [the] company operates due to the new U.K. Bribery Act.” Last years the percentage was 11%.
General findings of note. “Fifty-two percent of the public companies and 60% of the larger companies have launched an internal investigation in the past 12 months.” “Twenty-four percent of U.S. companies and 19% of U.K. companies that conducted an internal investigation went on to report the matter to a regulatory agency.”
The Litigation Trends Survey involved a total of 405 participants, including 275 in the U.S. and 129 in the U.K. Approximately 75% of participants have the title general counsel or head of litigation.
Kroll Global Fraud Report
Kroll, a leading risk consulting company, recently released in 2011/2012 Global Fraud Report Survey (see here). FCPA / U.K. Bribery Act findings include the following.
“Despite heightened concerns, only 27% of respondents said they are well-prepared to comply with the Foreign Corrupt Practices Act (FCPA) and UK Bribery Act (UKBA). Of those companies that are subject to one of these two laws, less than half, 43%, have trained senior management, agents, vendors and foreign employees to be compliant with one of these laws, and just 39% have assessed the risks arising from them. Furthermore, only 37% of companies surveyed believe that their due diligence provides a sufficient understanding of a potential partner’s or investment target’s compliance with these acts.”
“47% of respondents consider their companies moderately to highly vulnerable to corruption and bribery. It is the leading risk causing companies to avoid investing in new regions or countries at 28%. Only 43% of respondents believe their companies have trained their managers, agents, vendors and foreign employees to be both familiar and compliant with the UK Bribery Act and FCPA. Just 39% have made a thorough assessment of risks to their organizations as a result of the UKBA or FCPA and have ongoing monitoring systems in place. Just over half (54%) of companies say they have adequate procedures in place to prevent bribery at all levels. Only 34% of respondents say their compliance regimes are more global as a result of the extraterritorial reach of the UKBA and FCPA. Only 37% believe their due diligence in advance of an acquisition, joint venture or financing provides sufficient understanding of a target’s compliance with the Acts.”
The Kroll survey involved “more than 1,200 senior executives worldwide from a broad range of industries and functions … polled in June and July 2011.” According to the survey, “nearly one-half of respondents, 47%, occupy C-suite roles and one-half of participants came from companies with annual revenues of over $500 million.”
