The EY EMEIA (Europe, the Middle East, India, Africa) Fraud Survey has recently revealed that senior managers in the countries studied are failing to set the right tone on business ethics.
Despite progress in tackling bribery and corruption across Europe, the Middle East, India and Africa (EMEIA), 51% of respondents to the biennial EY EMEIA Fraud Survey still perceive the problem to be widespread in their country.
Moreover, 27% of all respondents stated that it is common practice in their business sector to use bribery to win contracts, including 14% of respondents in Western Europe. The report surveyed 4,100 employees from large businesses in 41 countries.
According to the survey, senior management in these countries are failing to foster a culture of ethical behaviour, with 77% of board directors or senior managers saying they would be willing to justify some form of unethical behaviour to help a business survive and one in three willing to offer cash payments to win or retain business.
Nevertheless, 28% of respondents believe that regulation has had a positive impact on deterring unethical behavior, an increase of 4% from the 2015 survey, and 77% agreed that the prosecution of individuals would help deter fraud, bribery and corruption by executives.
Gérard Zolt, Fraud Investigation & Dispute Services Leader at EY Luxembourg, stated that: “Companies need to take steps to create a culture in which it is in employees’ interests to do the right thing. Training and awareness programs can play a big role in helping individuals understand the consequences of fraud and corruption, and encourage them to come forward if they have concerns over unethical conduct.”
Despite the fact that whistleblowing hotlines are now considered an important part of a company’s compliance program, only 21% of respondents were aware of such a channel in their company, while 73% would consider providing information directly to a third party such as a law enforcement agency or regulator.
Concerning Luxembourg, Gérard Zolt added that: “While Luxembourg is well positioned in an internationally recognized survey on corruption, a recent case in front of the criminal courts demonstrate that even the public service is not immune of corruption.”
