Almost half of all UK businesses have never heard of the Bribery Act, and are unaware of its implications on their activities.
Research conducted by Big Four consultancy Ernst & Young found that just 56 per cent of UK companies have knowledge of the legislation, which came into force over a year ago.
The study revealed larger firms - those with a turnover of more than £50 million - are ahead in terms of their awareness of the Bribery Act, with 76 per cent aware of the law.
Midmarket firms (£5 million to £50 million) still have a long way to go, with a worrying 64 per cent of them lacking understanding of the law.
Of those firms which had heard of the Bribery Act, just over half of them (52 per cent) vet their suppliers to see if they too are compliant.
Nearly three-quarters of firms in the North of England (78 per cent) are still unaware of the legislation, along with 72 per cent on the south and 67 per cent in Scotland.
John Smart, partner at Ernst & Young said the act has been in force since July 2011, so it is "a concern" that so many companies do not know what it is.
They fail to understand its application, and the risks of contravening the legislation, he noted.
"We shouldn’t need to wait for a company to be fined under the act before we are spurred into taking the appropriate precautions to manage bribery risk," he stated.
Mr Smart commented that midmarket firms and those operating in manufacturing "really need to get to grips with their bribery risks without delay".
"If the UK is to export itself back to growth, then this carries with it a whole raft of new risks, including bribery," he stated.
"A robust review of the supply chain should be a key focus for businesses, as proper processes for vetting suppliers are required under the legislation."
Mr Smart said it seems that firms are either underestimating bribery risk, do not feel sufficiently educated to give their staff adequate guidance, or are failing to see the urgency in ensuring that their organisations and their suppliers are Bribery Act-compliant.
"In any case, these results should serve as a stark warning to firms that they should ramp up their compliance procedures," he added.
Companies must ensure that clear anti-bribery policies are in place right across the business and the supply chain, and that relevant staff receive sufficient training, Mr Smart added.
Posted by Dan Smith