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Bufete Buades, as part of the ‘Nos queda la palabra’ (‘The words remain’) initiative, joined forces with RSM Spain to hold a seminar on Compliance, ‘When management is held criminally accountable for employee offences’, with the aim of helping to resolve concerns in this area.
A press conference preceded the event, which opened with presentations by Joan Buades, Managing Partner of Bufete Buades; Pedro Horrach, the Balearic Islands Anti-Corruption Prosecutor; Llorenç Salvà, criminal lawyer at Bufete Buades; Julio Capilla, Managing Partner of RSM Spain; and Mario Cepero, partner at RSM Spain.
Joan Buades explained, ‘Those of us that work as consultants to businesses must be aware that this criminalisation affects political parties, trade unions and other organisations as well as limited companies and public limited companies.’ The Chairman of Bufete Buades thanked the public prosecutor, Pedro Horrach, for making time in his busy schedule, and José Luis Roses, President of the Chamber of Commerce, for his active involvement in the impeccable organisation of the event.
Buades continued, ‘It is vital that companies create a culture of regulatory compliance by implementing accountability measures to prevent their employees from committing crimes wherever possible. In the end it comes down to putting mechanisms in place that ensure compliance with a company ethic which is opposed to the commission of crimes.’
During his presentation to the attendees – over a hundred employers and managers, mainly from the Balearic Islands – the Balearic Islands Anti-Corruption Prosecutor placed special emphasis on the following recommendation: ‘My advice to companies is to plough resources into preventing and avoiding the damage to their reputations that will result from a judicial investigation.’
Many Balearic Islands companies currently have no regulatory compliance programme in place to protect their administrators from criminal charges. In reference to the current legislation, Horrach pointed out, ‘Public administrations are criminally accountable, but auxiliary agencies in public administration – foundations, for example – are not, and this needs to change as soon as possible.’ In fact, legal compliance protocols should also be assigned to the Public Administration, according to Horrach, who said ‘Keep a close eye on procurement in any department in your company that has a direct link with the Public Administration. That is where there is the greatest risk of crimes being committed.’
In his presentation, criminal lawyer Llorenç Salvà said, ‘Companies are not obliged to implement crime prevention programmes, but that doesn’t mean it isn’t a good idea to be more competitive with respect to corporate crime prevention, to avoid the subsequent negative legal consequences.’ Salvà went on to contradict the idea that numerous international judicial instruments are calling for a clear criminal justice response for legal persons, though regulatory moves are being made toward changing this, and he affirmed that evolving legislation on Compliance is inevitable.
Rewards for compliant companies
Compliance programmes aim to prevent crimes being committed by natural persons. If a crime is committed in spite of all efforts to the contrary, the programme’s value will become apparent, allowing the company to exonerate itself from criminal accountability.
In this respect the Anti-Corruption Prosecutor said, ‘A regulatory compliance culture is not achieved by punishment alone. It is far more productive to reward companies that do comply with the current legal requirements, in the form of tax concessions, for example. Steps must be taken to promote a culture of respect for legal norms.’
Putting measures in place to prevent employees from committing crimes
Regarding the application of Compliance programmes, Mario Cepero, partner at RSM Spain, warned that 80% of small- and medium-sized companies in Spain are operating without a Compliance programme – an alarming figure in light of the fact that 97% of Spanish companies are small- and medium-sized.
Both Cepero and Julio Capilla, Managing Partner of RSM Spain, agreed that a single generic Compliance model is not possible. Each programme needs to be tailor-made according to company-specific risks which a generic model would neither detect nor mitigate.
The event was concluded with cocktails for all the attendees in the Chamber of Commerce’s facilities.