Among Fortune 500 companies, only 19 of those with public codes of conduct prohibit their employees from making so-called “grease payments” to foreign officials. But a whopping 373 companies deal with the same issue by simply not mentioning it at all in their codes of conduct, according to a new study.
Under the Foreign Corrupt Practices Act, a facilitation or grease payment is legal if made to a foreign official, political party, or party official for “routine government action,” such as processing papers or issuing permits in order to expedite an act that would occur anyway. The payment becomes a bribe, however, if it attempts to influence the outcome of an official’s action—such as approval of a permit—rather than the timing of it.
One of the 19 companies that are explicit about banning this kind of payment is Cincinnati-based Procter & Gamble Company. “At P&G, we strive to do the right thing, and this often means that our policies exceed legal requirements,” said Libby Rutherford, P&G’s vice president and general counsel for global compliance.
Rutherford explained, “We know that bribery harms the company and the communities in which we do business. P&G’s policy is to prohibit facilitating payments worldwide, even though they are permissible under U.S. law. In this regard, we support government efforts around the world in combating bribery, while helping to improve local communities.”
via Many Fortune 500 Policies Unclear on Foreign ‘Grease Payments’.
