Cookies help us to understand you better. Browse on or click to
How harmful is a bribery or corruption scandal to a company
Corruption involves a wide range of activities including bribery and dishonest or fraudulent practices by relatively powerful people.
With the prevalence of corruption globally, the UK Bribery Act 2010 requires companies to mitigate financial penalties and reputational risks associated with these illegal acts within their organisation and third-parties, through adequate preventative measures. However, despite strict regulations, scandals do still emerge and once implicated, companies are exposed to catastrophic consequences.
Offering insight into the potential consequences of bribery and corruption, General Manager of Data Services at LexisNexis, Rudi Kruger said companies embroiled in corruption scandals could face:
- Loss of revenue as a result of being excluded from potential business opportunities or undergoing operational down-time.
- Damage to company’s brand, reputation and overall market value.
- Liability to pay hefty fines and penalties, as per the various local and international regulatory landscape.
- Unexpected costs incurred from the investigation, including expensive legal fees
- Loss of man hours and diversion of significant employees who require time away to manage investigations.
- Loss of investor and shareholder trust as well as subsequent loss of their financial support.
- Loss of customers/clients – both past, existing and potential customers.
- Weakening of team morale, resulting in a decline in performance and productivity.
- Lawsuits from various parties, who may have been negatively impacted by the scandal.
- Closure of the company, as a last resort.
“Very few businesses are prepared or willing to incur the immense costs and consequences of being involved in a scandal,” said Kruger.
“This is why effective implementation of anti-bribery and corruption standards as a risk preventative serves every company well and moves toward safeguarding them from potential scandals. It’s in your organisation’s best interest to have in place comprehensive due diligence policies and procedures, which prove highly effective in mitigating risk,” he added.
Kruger said risk prevention begins with vetting and due diligence, conducted on all parties associated with the business including leaders, suppliers, partners, investors, acquisition targets, contractors, resellers and grant applicants.
Many steps make up an effective due diligence programme but aspects of the task are simplified with Lexis® Diligence, an online solution that provides access to the intelligence needed to carry out due diligence checks on third parties in-house in accordance with The Bribery Act, thus mitigating operational, financial, legal, and reputational risk.
The solution is a highly advanced research tool that highlights the rule of law and provides rules and guidelines to ensure the legality of all client and company procedure. It comprises of a comprehensive database of more than 40 years of global archived news and data, designed to help a company perform the necessary due diligence in the areas of risk, compliance and fraud.
Practically, LexisDilligence enables users to select a prospective third party, perform a company or person check, explore associated entity interests, check against sanctions, check for red flags and politically exposed persons data, search for negative news, check the litigation history, assess country risk and confirm as partner/ supplier/ distributor.
The solution also enables compliance officers to review data from the UK, EU, US and selected Asian jurisdictions. Complementary solutions from LexisNexis Data Services that can assist with due diligence and investigations into Anti Money Laundering (AML) and Counter Terrorist Financing (CTF) include Diligence Spotter and Batch NameCheck.
For more information, visit:
About Rudi Kruger
Rudi Kruger is the General Manager of LexisNexis Data Services. He is responsible for African and International risk solutions. He has 11 years banking experience with strong focus on trade services, risk and compliance. He successfully completed various courses within the banking industry, as well as IOB Certificate in banking and completed a MAP program at WBS in 2014. Rudi is responsible for the execution of new business development, strategy and sustainable growth, by introducing new products offering and enhancements to the Sub Saharan African market.
About LexisNexis Legal & Professional
LexisNexis Legal & Professional is a leading global provider of legal, regulatory and business information and analytics that help customers increase productivity, improve decision-making and outcomes, and advance the rule of law around the world. As a digital pioneer, the company was the first to bring legal and business information online with its Lexis and Nexis services. LexisNexis Legal & Professional, which serves customers in more than 130 countries with 10,000 employees worldwide, is part of RELX Group, a global provider of information and analytics for professional and business customers across industries.
About LexisNexis Data Services
A division of LexisNexis South Africa, LexisNexis Data Services assists corporate and government entities to uncover the information they require to get a complete picture of individuals, businesses and assets. Industry-leading solutions such asLexis ProcureCheck, Lexis Diligence, Lexis RefCheck and LexisWinDeed make it easier for organisations to carry out background screening, access public records and other key data sources to conduct the necessary due diligence required to protect their business and comply with local and global legislation. With the most comprehensive collection of data sources in South Africa, LexisNexis Data Services quickly and efficiently delivers specific, in-depth information to address any industry-specific need.
For more on LexisNexis Data Services visit: