Organization of internal business processes

24 march, 2023

The establishment of internal business processes and compliance with internal rules in the company is crucial in the effective implementation of compliance. Today we would like to explain how streamlining internal business processes can protect businesses from offences and risks.

1. Setting limits, and restrictions on the direction and control of the company's corporate expenses

The lack of control over the company's corporate expenses can lead not only to abuse (including misappropriation of funds) and fraud by individual employees but also to serious negative consequences of the application of anti-corruption extraterritorial legislation, for example, the UK Anti-Bribery Act (UK Bribery Act/UKBA) or the US Foreign Corrupt Practices Act/FCPA. In particular, the FCPA, a US federal law, prohibits all forms of bribery (regarding public officials around the world), receiving in any possible way a benefit from the abuse of power by relevant officials. So, a company subject to the FCPA, whose employee will provide an illegal benefit to an official with corporate funds, say in Ukraine, can receive a huge fine (tens or even hundreds of millions of dollars) for such a corrupt offence.

2. Implementation of electronic systems for supporting business processes

Electronic support systems for business processes make it possible to systematize, eliminate gaps and better monitor possible violations.

3. Establishment of procedures for approval and accounting of charitable contributions and sponsorship payments

In the absence of appropriate procedures, the implementation of such contributions and payments may be qualified as providing an improper benefit.
By the way, the same FCPA establishes responsibility for the failure to implement a reliable compliance system, as well as the lack of accurate and transparent internal documentation and accounting books of the company.

Which of the following have you implemented in your company?

Detailed instructions for business "Basic principles of risk identification and their minimization" at the link: