Ahead of the Retail Fraud Show on 14th April and with the recently disclosed Bribery Act guidelines, we asked Phil Willsmer, Director of Operational Risk for the Co-Op Group, for his thoughts on the effects of the Bribery Act within the retail sector, challenges for good corporate governance and what we can expect from the Retail Fraud Show on 14th April.
What effect do you anticipate the Bribery Act will have on Co-op and retail as a whole?
With regards to the Co-op Group, the implications of the Bribery Act Adequate Procedures will help to reinforce the excellent levels of corporate governance we currently have in place. A complex organisation like ours needs to have consistent messages and procedures across the differing businesses. Compliance is one of the requirements that has been embraced at the very top of our organisation. The retail sector is no different to other sectors in the UK and whilst each has its own challenges, the requirements of the Act are very generic in their wording. It astonishes me that some organisations appear to be either ignoring the Act or are in the very early stages of building a framework to be compliant to the requirements of this legislation.
Do you think the Bribery Act will have a significant impact on both SMEs and large corporates? If so, how?
There are various challenges for different sizes of business, with more emphasis being placed on large corporations to ensure they have good governance not just within their own organisation but also in their supply chain and intermediaries. This in itself presents a logistical challenge to ensure that all your third party suppliers and contractors implement similar levels of compliance to yourselves. The challenge for regulators is getting the message across effectively to SMEs and there will be a requirement for support to be provided in understanding the legislation at this level. I believe there is a role for large corporations and the regulators to play in determining a wider understanding by all SMEs.
What challenges does good corporate governance present in modern business?
Corporate governance should be embedded in any modern business as it is fundamental to the values and principles of how an organisation should operate. It also reduces the risk of financial and reputation harm to an organisation and provides assurance to the Board about the regulations that are in place. This is why governance needs to be driven from the top down and have exposure and representation through risk committees and the executives of any business.
What made you decide to implement Expolink’s whistleblowing hotline at Co-op?
We conducted a review of the existing whistleblowing requirements of the Group and identified that due to the size of the organisation and the diversity of its businesses, we needed a whistleblowing service that could effectively respond to the unique challenges presented. Expolink was selected as the clear winner on a number of set criteria and the relationship has gone from strength to strength. We also introduced a bespoke data security line service with Expolink and the fact this was implemented with minimum impact and disruption, is a reflection on the relationship that exists between our two organisations.
What aspects of the hotline have you found most beneficial?
There are two main aspects; the first being the proactive way our account is managed. An example of which is when the requirements of the Bribery Act were originally announced in the consultation paper, Expolink approached us and offered to extend the service to all our supplier base which gave us an additional level of compliance and which was tailored to suit our organisation. The second aspect is the contact and support we receive from the Expolink team, across all areas, and the ‘can do’ attitude displayed, to every challenge given to them.
Please would you tell us a bit more about what we can expect at the Retail Fraud Show on 14th April?
Sam Cowburn is the Co-Op Groups’ Bribery Compliance Manager and will reveal the journey we have been on, so far, to ensure the Group is in the best possible shape for compliance to the legislation. Whilst the publication of the adequate procedures has been put on hold by the current Government, it would be naive to take this as an indication that the legislation will not be enacted. I strongly recommend that organisations use the additional time to ensure that their policies and processes are as robust as possible for when the Act does eventually come into force.
What does ethical business practice mean to the Co-op Group?
Simply put, it is at the heart of our culture and influences everything we do as an organisation. We have built a reputation around our values and principles and this is something that we will never compromise on, regardless of the commercial pressures we are exposed to in these difficult economic times.
What are the greatest challenges ethical businesses face in modern society?
The fact that we live in a throwaway society means there is a drive for the most economical goods and produce which can lead to unethical practices in other parts of the world. I think that all large corporations are aware of the damage which these practices can have on their brand reputation if exposed to the wider public, so this acts as a social conscience which is a good thing. There are many organisations that trade responsibly and ethically and this can only be a step forward.
How does Co-op protect itself against retail fraud?
We utilise similar procedures to many other retailers that include analytical tools and measures to reduce all types of fraud, both within our retail environments and also at our corporate centres.
Contact us today to find out how our whistleblowing hotline can help you protect your business. You can also find out what our clients say about our services and read more about how our whistleblowing hotline helped The Co-operative Group in this case study.