30/01/2012 Author: David Beattie

Asset management sector lacks consistent anti-bribery standards finds E&Y survey

Despite seven months passing since the introduction of the UK’s anti-bribery act, asset managers have not yet adopted a consistent approach to the new rules, according to the results of an Ernst and Young compliance survey.

While over 85% of managers reviewed expense claims and kept logs on donations, entertainment, and gifts, the threshold for the latter two varied from £20-500, it found. Meanwhile a number of firms have yet to formalise their reporting procedures or thresholds, it added.

“The survey showed that while progress has been made on implementing the underlying principles of the anti-bribery legislation, managers are acting in silos and are a long way from reaching any kind of consensus on what is appropriate in terms of gifts and entertainment,” said Ernst and Young’s UK head of asset management Gillian Lofts.

“Several respondents also voiced opinions that the new UK measures went beyond any other national ABC practices, including the US Foreign Corrupt Practices Act 2010,” added Lofts.

Anthony Kirby, regulatory reform head at E&Y’s UK asset management division said: “Around 60-70% of the European market seems to have taken the majority of the anti-bribery legislation on board and firms both inside and outside of the UK are making an effort to comply, but there has been little to no benchmarking done and this is reflected in the significant variation between individual managers’ thresholds and reporting procedures.”

“We are not in favour of set thresholds across the market but we will be encouraging managers to speak more openly with their peers. If these large discrepancies continue there is a risk that an unlevel playing field will develop,” he concluded.