In recent years, the fight against bribery and corruption has been the subject of increased focus in Nordic markets. New anti-corruption legislation as well as cases involving alleged bribery and corporate fraud have received extensive law enforcement and media attention.
In the United States the Foreign Corrupt Practices Act (FCPA) has been an important legislative landmark guiding corporations. Enacted in July 2011, the UK’s Bribery Act has helped frame the counter-attack on corporate corruption in Europe, and has highlighted the risks businesses face.
The significance of the UK Bribery Act for European corporations lies in its ability to, in certain circumstances, bring legal action against non-UK corporations and their representatives. Furthermore, not only are intentional acts of corruption sanctioned, but failure to implement adequate measures to prevent bribery and corruption may also lead to serious financial repercussions such as unlimited fines.
Recent developments in Finland and Sweden
Finland has recently seen a rise in high profile cases of alleged bribery and corruption, some of which have led to prosecution. However challenges in securing sufficient evidence have resulted in a rather low conviction rate.
In July 2012, the Swedish legislature introduced revised anti-corruption laws. This included a new offence, “Negligent financing of bribery” (Sw. vårdslös finansiering av mutbrott), which aims to hold corporations and their representatives liable for indirect financing or promotion of bribery, for example by using agents.
In spite of the new legislation in Sweden, and recent media focus on suspected corruption in both countries, a majority of corporations in the two countries lacks clear anti-corruption policies.
Criminal sanctions – far from the only consequences of suspected corruption
Although both Finnish and Swedish law provide for severe criminal sanctions against corporations and their representatives, recent examples have shown that there is a large gap between suspected bribery and securing a criminal conviction.
However, even if criminal sanctions are rare such suspicions may still damage a corporation’s public image. Negative publicity arising from allegations of bribery and corruption – rightful or not – may have a detrimental impact on a corporation’s operations, for example by forcing it to invest extensive time and resources in fielding queries from the media and alleviating investor concerns.
Preventing criminal sanctions and unwanted media attention
It may not be possible to fully insulate corporations and their representatives from the risk of criminal charges and negative publicity from allegations of impropriety. Nevertheless, corporations may mitigate the risk of criminal charges and unwanted media attention by continuously surveying and assessing the specific risks related to their enterprises and industries, and by deploying relevant risk management and remediation processes to navigate potential violations. Ultimately, a comprehensive anti-corruption policy that anticipates business risks and provides a clear script for remedial action in the event of suspected or proven impropriety is indispensable for every Nordic corporation doing business in the global arena.