Your Questions: Answered - Written by Barry & Richard on Sunday, May 20, 2012 3:55 - 2 Comments
Your questions answered: Peter Lloyd, CEO Mabey Group looks at long supply chains
My business is in the construction industry and we often have long supply chains. The guidance for the Bribery Act says that we should focus on those that we have contracts with. However, it may be that there are people supplying services to us who are other peoples sub-contractors.
Putting aside the government guidance the Bribery Act says that we are on the hook these subcontractors. It’s unwieldy to vet the entire supply chain and can be impossible since we may not know who is in it.
In practice how would you deal with this?
This is not a situation that we have come across to a significant extent as our ‘in-country’ supply chains rarely extend beyond a single level. My immediate view is that we would do a basic risk assessment of the supply chain and look at who might be capable of corrupt actions that could create a risk for Mabey.
For example, if we have a relationship, possibly a partnership, with a main contractor who is tendering to win government contracts, then we would undoubtedly require a rigorous level of due diligence on the main contractor. If after the tender is awarded the contractor chooses a local sub-contractor to do some of the work through an open tender, perhaps erection of the bridge, then the risk that that sub-contractor has been corrupt on behalf of the tender team and Mabey should be small. However, if the sub-contractor is part of the tender team and has a direct interest in winning the government tender, then we would be more concerned and additional due diligence would be required. As always, there is no simple answer, but appropriate risk assessment and due diligence within a solid management system will give you the best protection that you can get.