A Bribe is a Bribe, No Matter the Size
The U.S. Foreign Corrupt Practices Act permits the making of small bribes for “routine governmental administration” known as facilitating or “grease payments”. While including this exception into the law showed a lot of foresight and a nuanced understanding of the endemic corruption that exists across the world, as a practical matter, explaining in a policy that it is sometimes ok to bribe undercuts the effectiveness of the anti-bribery program and leaves too much to interpretation.
It is far less confusing to state unambiguously: “bribery of any kind is prohibited”. Recently, the FCPA Blog published a benchmarking report of some of the major companies they track and their stance on facilitation payments. Not unexpectedly, most organizations ban them outright. The Walt Disney Company’s Anti-Bribery Policy states in part: “Facilitation payments are prohibited under this policy except in case of duress.” This wording is a little more rooted in reality than most and it reminded me of the time I spent in a Commonwealth of Independent States country investigating a FCPA case. After 8 days interviewing several former foreign government officials who had been implicated in a corruption scandal involving the state-owned oil company, it was time to go home. While there, I was followed everywhere I went from the time my plane first landed and our hotel rooms were equipped with listening devices. The overt nature of the surveillance was almost comical. Almost that is, if it wasn’t so uncomfortable. As I was making my way to the ticket counter at the international airport named after one of the officials I was investigating, an extremely menacing, 6’7″ man who tipped the scales well over 300 pounds and dressed as an airport worker tried to grab my suitcase from my hand while his associate explained in broken English that my bag needed to be shrink-wrapped and that it would be 10 Euro. As I looked into the eyes of the largest and scariest human I had encountered during my stay, my mind began to race. I considered the negative affect of endemic corruption on the state of the country’s healthcare system, specifically, its emergency rooms and whether I wanted to experience those shortcomings firsthand from the perspective of a trauma patient. I contemplated the cost of orthopedic surgery without local health insurance and weighed it against what now seemed like a very reasonable sum of 10 Euro. After having carefully contemplated the state of the country’s health care system and the lingering questions about my lack of local health insurance, I released the handle of my suitcase and let Frankenstein’s monster wrap my suitcase in plastic along with part of my bruised ego. Had I worked for the Walt Disney Company at the time, it would have been easy to explain to the Chief Compliance Officer after the fact that I was under duress. At the time of the incident leading to my duress, my employer’s anti-bribery and corruption policy (which incidentally, I had authored) didn’t enter my thoughts – not even for a second. I had more immediate concerns and departing from policy hadn’t made the list.
There is no question that the only way to go when it comes to how to word an anti-bribery policy is to ban facilitation payments outright. It is far too confusing to do otherwise and it will lead to potentially disastrous outcomes as your employees apply their own interpretations to which bribes are ok. It is however important to understand that, regardless of whether your policy prohibits bribery outright or leaves a little wiggle room, it won’t change behaviors as much as you’d like to think. In many societies including our own, petty bribes to government officials are part of the fabric of our societies and ethnic cultures. People will continue to pay small bribes to get their driver’s licenses faster, their power turned on, to make sure their household trash gets picked up and anything involving threats to their personal safety. These examples are not likely to lead to liability on anyone’s part since there is no unfair business advantage hanging in the balance. Just basic needs that local government functionaries are supposed to be providing to their citizens in the first place.
Policies that include an outright ban of facilitation payments make a lot of sense given how confusing and counterproductive it can be to try to explain that some bribes are ok. It’s hard enough to get people to take compliance training and for any of the content to make enough of an impression for it to make a difference. Policies and procedures are guidelines and expectations. They outline the company’s stance of broad topics of compliance such as bribery, money laundering, conflicts of interest and fraud. They state the obvious, caution against violating the policy and provide information on who to put your questions to. These policies and the programs they represent are a reflection of the collection of legal frameworks that organizations must operate within across their global footprints. These are documents that must be written in black and white terms with the understanding that in much of the world, businesses intersect with governmental oversight in various shades of gray.