Looking at the issue of external supplier management, Howard Cooper, managing director and global co-head of the financial investigations practice at Kroll, says: “In today’s complex environment, businesses need to have a tight grasp of their internal data as well as the ability to ‘zoom out’ to the external environment.
"This is only possible if a business is able to look outward and close the gap between internal policies and external developments. If a business can pass on some of its wisdom to one of its long-term suppliers through training or ‘meeting the team’ sessions, for example, that supplier will become less vulnerable, making it a stronger link in the chain. Company culture is a key component of any successful strategy to curb bribery and corruption risk.”
Jeremy Summers, head of business crime at solicitors Osborne Clarke, agrees that the pandemic has had an impact, including on third-party supplier management: “Covid has been a factor. Supply chains have had to change due to the pandemic and the ability to ensure effective oversight of both internal actors and external third parties has been weakened because of the difficulties in achieving face-to-face interaction.”
But leaving Covid and suppliers aside, there is another reason why the world’s biggest corporates are being hit hard by illicit activity despite bolstering their defences, as Summers explains: “Large, multi-national companies operating in high-risk sectors and jurisdictions will always be at increased risk of fraud and corruption due to the sums involved in the contracts that they are involved in, which often acts as a magnet for criminal activity seeking illicit profit.”
To address the issue, he echoes the focus on risk and technology: “Big corporates should continuously conduct and review risk assessments to ensure that risks are understood and mitigated. Where appropriate, data analytics including AI should be used to obtain a detailed picture of the criminal risks faced by a particular business.”
In the meantime, at government level, the UK is taking further steps to tackle corruption.
In a statement to parliament in April, then foreign secretary Dominic Raab announced the UK’s first sanctions under the global anti-corruption sanctions regulations 2021 on 22 people who had been engaging in serious levels of corruption. Referring to other government actions, he said that 4.5m companies were now listed on the public register of company owners, which was established in 2016, to address the issue of anonymous shell companies used to shift corrupt money around.
