From law firm Sheppard Mullin, a word of caution about corruption risks in the fashion and beauty industry:
“Based on recent enforcement actions, however, and the unique nature of companies in the fashion and beauty industry, several key anti-bribery basics should be considered by any company in the industry:
Set the Tone at the Top. This is probably the single most important element of a successful FCPA compliance program. This is of particular importance in the fashion and beauty industry given that senior managers may be well known and appear publicly on a regular basis. When senior management consistently demonstrates its commitment to compliance, the commitment tends to permeate the enterprise.
Tailored Compliance Policies. It is a basic truth that an effective compliance program must be appropriately tailored to the organization. It needs to work. For companies in the fashion and beauty industry, especially when operating in China and other parts of the world where many companies are owned or controlled by the government, this means there need to be specific procedures related to entertaining government officials and properly recording for such expenses. It is important that those procedures reflect the fact that even small hospitality expenses, such as private fashion shows, may be enough to create potential FCPA liability.”
Read the full update, FCPA Compliance Considerations for the Fashion and Beauty Industry - Sheppard Mullin Richter & Hampton LLP»