A couple of recent court cases have helped to highlight the changing mood towards institutional wrongdoing. They show just how far attitudes towards those that transgress have intensified and evolved over time.
The first that springs to mind saw consultancy firm Sweett Group ordered to pay £2.25m for breaching the Bribery Act in the United Arab Emirates, the first full-blown corporate prosecution of its kind under the Act.
The Serious Fraud Office, which will often opt for a Deferred Prosecution Agreement (DPA) when parties agree to co-operate with the authorities, chose not to offer a DPA despite the decision to plead guilty.
Without adequate anti-bribery procedures in place firms have little in the way of protection. When instances do occur there is no scope for mitigation. We only need to look at the size of the penalty to see this.
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The other, more recent, case involved Balfour Beatty. For breaching health and safety legislation, the firm was handed a £2.6m fine after a trench collapse in which one employee died.
Some have said that it is wrong to take money out of the industry with fines, and it would be better spent ensuring that training is improved, particularly in smaller firms. The point is missed. The fine is a punishment – and in this instance the firm was not an SME.
The same commentators suggest a smaller fine combined with a court-supervised safety training programme for firms in breach of the law could be the way forward. Again I have to disagree. This shifts responsibility onto the courts and turns something of vital importance into another box-ticking exercise.
Contractors are right to be concerned about the potential scale of fines for breaches in health and safety legislation, but the remedy is in their hands.
What both cases have in common is the fact that neither firm could claim any mitigation. Both failed to demonstrate that the appropriate steps had been taken to prevent either accident.
People do make mistakes. That’s life. On occasion you also get a rogue operator. But it is well-designed policies and procedures that provide the scope for mitigation on the rare occasion when things do go wrong.
So where are the next tripwires likely to be? The transparency in supply chain regulations in S54 of the Modern Slavery Act 2015 is a starting point. While the initial focus is on reporting in supply chains, the only court you will end up in at the very beginning is the court of public opinion. As we know, it’s now this court which can drive the legislative process.
