Corruption still rife, says report
ILLEGAL and corrupt business practices such as bribery are still being used by organisations to secure or retain business according to a new report.
Despite the rise in international anti-corruption legislation UK businesses are still not doing enough to understand the risks according to the findings of the tenth global fraud survey from Ernst & Young.
The survey, which interviewed 1,186 business leaders in large organisations across 33 countries, showed that almost a quarter of respondents admitted their organisation had been approached to pay a bribe in order to retain or win business in the last two years.
Some 18% said they had lost business to a competitor as a result of them paying a bribe.
Although the UK experiences of illegal business practices are lower than the global average, bribery and corruption still plays a role in the conduct of business.
Around 13% of all UK respondents said that their organisation had experienced at least one incident of bribery or corruption in the last two years, compared to 6% in Germany and 6% in France.
The global average was 24% – highlighting the increased risks of doing business outside Western Europe.
Jonathan Middup, fraud investigation and dispute partner at Ernst & Young, said: “It is worryingly clear from the survey that companies subject to anti bribery legislation do not fully understand the details of their requirements. Companies cannot afford to ignore the obligations associated with the FCPA and other anti-bribery laws. Despite the best efforts of some governments, non-governmental organisations and law enforcement agencies, the risk of bribery and corruption remains prevalent. Awareness, education and control are the most effective methods for dealing with corrupt financial practices. Promoting ethical behaviour in your organisation – making a difference – is not just about staying on the right side of the law. It’s good business.”
High profile investigations into corrupt practices have dominated the headlines in the past two years, as the US authorities’ have taken a more aggressive and extra-territorial approach to enforcing the Foreign Corrupt Practices Act (FCPA).
However despite this 84% of all respondents claimed to know little to nothing about the FCPA, compared with 66% in the UK.
