Mitigation and detection of bribery in the supply chain
Bribery poses a significant threat within the supply chain, jeopardizing corporate integrity and potentially leading to severe consequences. Recent cases of bribery in the supply chain highlight the critical need for adopting innovative measures to prevent and detect such occurrences.
Various forms of bribery commonly manifest in supply chains, accompanied by real cases spanning from 2019 to 2023:
- Kickbacks: This involves the prepayment of a sum of money by a company to secure or influence the award of business. In certain instances, this practice undermines the integrity of the tender process.
- Bid Rigging: This occurs when a group of contractors colludes to manipulate bids, ensuring that one of them secures the contract. Consequently, the selection process loses its fairness and efficiency.
- Price Fixing: This entails an agreement among market participants to collectively raise, lower, or stabilize prices to control supply and demand. Such practices can adversely affect consumers and competitors not involved in the agreement, resulting in market unfairness.
Prevention and detection of bribery
To effectively address the threat of bribery in supply chains, companies should strengthen their prevention and detection measures. This involves implementing strategies that ensure supply chain integrity, such as robust anti-bribery policies and the utilization of technology to identify anomalous patterns, crucial for maintaining business sustainability.
- Strong anti-bribery policy. A clear and well-implemented anti-bribery policy is essential, extending from suppliers and distributors to employees. Full commitment from all involved parties is crucial to fostering a culture of integrity.
- Employee training and awareness. Education is paramount in preventing bribery. Regular anti-bribery training for all supply chain employees helps instill an understanding of the legal and business consequences of bribery, emphasizing the importance of maintaining company integrity..
- Auditing and monitoring. Regular audits are vital for identifying potential bribery risks. Companies can establish specialized internal teams or collaborate with independent third parties to conduct thorough assessments.
- Conduct due diligence with technology. Leveraging platforms like Know Your Vendor, aids in monitoring the entire due diligence process for prospective vendors. This platform streamlines questionnaire submission to report reading, providing valuable support with user-friendly features.
- Strict sanctions. Violations should incur strict sanctions, including termination of business relationships and legal action in accordance with applicable laws
Effectiveness of reporting systems
Developing prevention strategies necessitates a strong connection with detection measures. An effective method involves establishing a whistleblowing system to identify potential violations at an early stage, mitigating risks before they escalate.
Integrity Asia introduces the Canary Whistleblowing System, which combines reporting channels centralized on a website application. This enhances accessibility for clients to report while maintaining whistleblower confidentiality. The Canary Mute feature ensures safety by allowing anonymous reporting from employees, suppliers, and the public.
The platform offers multiple reporting channels, including phone calls, SMS, website forms, posts, mobile apps, emails, and online chats. Thus, the Canary Whistleblowing System not only provides convenience for whistleblowers but also strengthens integrity and security in the whistleblowing process.
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