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Bribery and Corruption: Risk assessment - EY - United States

Bribery and Corruption: Navigating the Global Risks

Risk assessment

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Anti-corruption compliance starts with a comprehensive evaluation of an organization's risk exposure.

A keen understanding of an organization's corruption risk exposure is the cornerstone and an essential first step in building an effective anti-corruption compliance program.

Risk-based compliance programs allow organizations to properly design mitigation strategies and strategically deploy resources to combat potential instances of bribery, corruption, and fraud.

Significant advantages can be gained for global organizations that recognize the importance of identifying weaknesses throughout their business in terms of bribery, corruption and fraud prevention. Senior executives that are aggressive in filling gaps in current anti-corruption policies by implementing strong solutions can minimize future costs and improve business operations.

Scope the potential problem

For an anti-corruption compliance program to operate effectively, a sound risk assessment process is key. A company's anti-corruption risk profile changes over time, and as such it is important to review and update the risk assessment on a regular basis.

Two important goals of a thorough and complete risk assessment are:

  1. To educate executives about corruption issues and risks
  2. To obtain organization buy-in for the anti-corruption program

Exposing 'red flags'

In many instances, transaction testing exposes "red flags" indicating high-risk activities or revealing weaknesses in certain anti-corruption compliance controls. Forensic accounting analysis and other approaches can unearth information suggesting corrupt payments or other questionable activities that might have been overlooked in traditional interviews or standard document review processes.

Our perspective – Four basic elements of a risk assessment

  1. A review of the organization's business to identify and understand its most significant corruption risks
  2. A review of the current state of the organization's current anti-corruption program
  3. A "gap analysis" of the current program versus the anti-corruption risks identified
  4. Recommendations for improvement to the program based on common and leading practices but also what is most practicable for the particular organization in terms of achieving compliance

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