Corporate compliance annual report
Recent Rolls Royce bribery case provides many lessons about compliance
Companies need to take complaints seriously and have proper whistle-blowing procedures to quickly identify ‘ bad behaviour ’ – being able to conduct quick investigations is also key
At a time when there is a move towards international standards in compliance , there are many lessons that can be learnt from the recent Rolls Royce bribery case , says Jonathan Armstrong , partner at London-based Cordery .
Speaking at an event held by Abreu Advogados , Armstrong said : “ Compliance is a global game now – there is a move towards looking at international standards , such as policies and procedures . The modern approach is to focus on behaviours rather than laws .”
He continued : “ You wouldn ’ t necessarily refer to the ‘ Portuguese law on bribery ’ for example . Instead , you ’ d say , ‘ it ’ s a bad thing to pay people bribes ’. We agree on these common standards of behaviour .”
Armstrong highlighted lessons that could be learnt from the Rolls Royce bribery case , which resulted in the company having to pay £ 671 million in fines following claims it paid bribes to win export contracts . He stressed the need to “ take complaints seriously and have proper whistle-blowing procedures that catch bad behavior quickly ”.
Businesses also must consider how they can monitor employees ’ use of modern technology and ensure they “ do the right thing ”, Armstrong said . In this respect , educating employees and being able to quickly conduct investigations are key .
Armstrong added : “ Globalisation is very important for corporations even if they don ’ t do much business outside of their home jurisdiction . For Portugal and Spain , it ’ s an indication of the direction of travel . We ’ ve seen Spain get tougher on compliance to meet international standards , and Portugal is part of that trend as well .”
Meanwhile , Francisco Patrício , partner at Abreu Advogados said compliance can “ no longer be seen as applicable only to banks and financial companies ”. He added that Portugal can “ learn from other jurisdictions ’ legislation , follow their example , and prepare ourselves for the foreseen changes ”.
Jonathan Armstrong , Cordery
Compliance awareness in Spain increasing , but market still unsophisticated
Large businesses in Spain are now recognising the importance of corporate compliance , though the market is still relatively immature , says Álvaro Gámez Serracarbassa , head of the compliance department at Andersen Tax & Legal .
Though it is still a largely undeveloped market , there are “ many companies requiring the implementation of new regulatory compliance programmes , or a review of any existing ones that are not ISO 19600 and / or ISO 19601 compliant ,” Gámez Serracarbassa says .
He adds that it is important – given the “ large body of rules applicable to companies , and the fact that such rules are subject to constant change ” – that corporate compliance programmes are continuously updated . Despite the fact that many companies in the Spanish market do not yet fully appreciate the importance of implementing compliance programmes , there are signs that awareness is increasing , says Gámez Serracarbassa . He adds that it is predominantly large-sized companies that are “ adding corporate compliance to their corporate policies ”. However , Gámez Serracarbassa also says there has been an increase in the number of midsized businesses requesting compliancerelated advice .
The reasons for this trend are clear , as businesses that fail to meet compliance standards and regulations “ risk facing financial , reputational and even criminal penalties , which are impossible to alleviate or avoid ,” Gámez Serracarbassa says . The assumption that corporate compliance is unnecessary because it is not “ mandated by law ” is a common mistake made by some companies , according to Gámez Serracarbassa . “ This view is too risky .” Practical steps can be taken such as appointing a law firm or a firm of consultants to draw up a compliance programme , he adds .
Álvaro Gámez Serracarbassa
www . iberianlawyer . com May / June 2017 • IBERIAN LAWYER • 47