Third-Party Relationships Emerge as a Key Bribery Risk for Businesses

Many businesses focus on employee training, codes of conduct and expense policies when assessing bribery risks. However, third parties such as agents, suppliers and intermediaries can also expose organisations to bribery and corruption risks.

Why Third Parties Pose a Bribery Risk

Businesses often rely on third parties to enter new markets and manage local operations. These intermediaries may work with limited supervision, receive commission-based payments or have access to business relationships that the organisation cannot easily monitor.

Customs agents and logistics providers can also pose risks. In some locations, they may face pressure to make unofficial payments to speed up shipments or clear goods.

Key Measures to Control Third-Party Risks

Organisations can reduce these risks by taking the following steps:

• Risk-based due diligence: Conduct background checks based on the level of risk. A sales agent working in a high-risk market may require more scrutiny than a routine stationery supplier.

• Clear business justification: Understand why an intermediary is needed and what services they provide. Unusually high commissions or payments that do not match the work performed should raise concerns.

• Strong contractual terms: Include anti-bribery clauses, audit rights and termination provisions in contracts. Require third parties to follow appropriate anti-bribery controls.

• Payment monitoring: Check for unusual transactions such as payments to unrelated accounts, unexplained cash payments or invoices that do not match the services provided.

• Regular reviews: Do not limit due diligence to the appointment stage. Review third-party relationships periodically to identify new risks.

Businesses Urged to Review Third-Party Relationships

Organisations should examine whether they can clearly explain what their third parties do, why they receive specific payments and whether they use subcontractors.

If a business cannot provide clear answers, it may have gaps in its risk controls. Identifying these gaps is an important part of an effective bribery risk assessment.

How ISO 37001 Supports Bribery Risk Management

ISO 37001 provides a framework for establishing and maintaining an anti-bribery management system. It requires organisations to conduct due diligence on business associates, transactions and projects where the assessed bribery risk is more than low. It also requires due diligence to be reviewed periodically where applicable.

This risk-based approach helps businesses focus their resources on relationships that pose greater risks instead of applying the same level of checks to every supplier.

By implementing appropriate controls and regularly reviewing third-party relationships, organisations can strengthen their anti-bribery measures and reduce their exposure to potential misconduct.