This section forms part of GIACC’s overall guidance on gifts, hospitality, entertainment, donations and other benefits (“Benefits”). It gives specific guidance on dealing with the corruption risk in relation to where the organisation is considering paying for sponsorship or community benefits.
Separate sections deal with the corruption risk in relation to other categories of Benefit. These other sections can be accessed on the following links:
See Benefits Policy for a sample policy which an organisation can adapt and use.
Sponsorship is where the organisation gives cash or another benefit to an individual or organisation to assist that individual or organisation perform or pay for an act (e.g. an individual running a race, or an organisation holding a sporting or cultural event or a conference, or a sports team rebuilding its pitch).
Community benefits are where the organisation provides a benefit to a community, such as building a school, or providing sports clothing to a team, or books to a school.
Sponsorship or community benefits could be considered to be a bribe if they are given or received with the intention of influencing someone to act improperly, or as a reward for having acted improperly.
The following are examples of where payment by the organisation of sponsorship or community benefits is not likely to be regarded as corrupt:
The following are examples of where payment by the organisation of sponsorship or community benefits is more likely to be regarded as corrupt:
The organisation should implement effective controls over sponsorship and community benefits, so as to minimise the risk that they could be corruptly given, or be perceived to be corruptly given.
The following are recommended controls, and some factors to be taken into account in implementing these controls.
If the funding by the organisation of sponsorship and /or community benefits is wholly or partially prohibited or restricted by the organisation, or by law, then state the prohibition or restriction in the organisation’s policy.
If the sponsorship or community benefit could be intended to influence someone to act improperly, it should not be offered or accepted.
Do not give sponsorship or a community benefit if it could reasonably be perceived to be corrupt. There are two common perception tests:
Before giving sponsorship or a community benefit, ensure that it is allowed by the law of the territory and the regulations of the recipient.
Undertake due diligence on the ultimate beneficiary of the sponsorship or community benefit before any commitment is made. The purpose of this due diligence is to ascertain whether there is any connection between the beneficiary and any business transaction or public official with which the organisation is involved, or is likely to be involved.
Prohibit the organisation’s personnel from requesting inappropriate sponsorship from third parties, such as sponsorship from an organisation over which they have a decision making function. If personnel of the organisation who are responsible for placing contracts with suppliers, or for approving suppliers’ work or payments, request those suppliers to sponsor the personnel or their friends or relatives (e.g. in a charity race), the suppliers may feel obliged to agree to sponsor the personnel as they may feel that failure to do so could adversely affect the personnel’s opinion of them and may prejudice their work prospects. Conversely, the personnel may favour those suppliers who make donations. For the same reasons, suppliers should not be asked to make donations for e.g. the organisation’s Christmas party or prize draw, even if the proceeds go to charity.
In some cases, the law requires sponsorship or community benefits to be disclosed on a public register or in the organisation’s annual accounts. Even if not required, some organisations voluntarily disclose sponsorship or community benefits on the basis that transparency can help avoid the perception of corruption.
Require approval in advance of the sponsorship or community benefit from the compliance manager, (and, if appropriate from an additional senior manager). The reasons for the request and the approval should be documented, and the compliance manager must be satisfied that the sponsorship or community benefit is appropriate, and is not corrupt, and could not reasonably be perceived to be corrupt.
Sponsorship and community benefits given and received should be recorded in a register or other appropriate record.
Updated on 10th April 2020