More than 90% of businesses globally believe that, to avoid corruption, they need transparency of ownership of the companies they do business with, according to EY’s 14th Global Fraud Survey.
Half of those surveyed in emerging markets believe bribery and corruption happen widely in their country, and 42% would justify unethical behavior to meet their financial targets or safeguard a company’s economic survival. Eighty-three percent also see enforcement against management as a fraud deterrent.
According to EY, “Our survey indicates that a persistent minority of executives continues to justify certain behaviors, including making corrupt payments, when facing an economic downturn or in an effort to improve the perceived financial performance of their company.”
Many of those ready to justify unethical conduct are CFOs and finance teams leaders, the firm found, noting this is especially worrying given the reliance and trust that boards place on CFOs and finance teams.
The survey recommends that companies adequately resource compliance and investigations functions before regulatory action is taken; establish clear whistleblowing channels and policies that encourage employees to report misconduct; and undertake regular fraud risk assessments that include potential data-driven indicators.