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News < Back Compliance : Sarbanes Oxley : Auditing : Fraud Fortifying Anti-Corruption in Today’s Corporation Majority Supports Internal Investigation and Zero-Tolerance Policy Toward Offenders
The study, titled Fortifying Anti-Corruption in Today’s Corporation, also revealed that despite differing views about disclosure, the vast majority of those surveyed (93 percent) believe that an internal investigation should be conducted if a significant incident of corruption were uncovered, and 75 percent support zero tolerance anti-corruption policies with strong disciplinary measures, including firing those responsible for corrupt acts. “Despite recent events showing that an aggressive response to corruption allegations, including voluntary disclosure to government authorities, can mitigate both financial penalties and the negative impact on their companies’ reputations, nearly half of executives surveyed would rather not disclose significant corruption incidents outside their organizations,” said Ed Rial, leader of the Foreign Corrupt Practices Act Consulting practice at Deloitte. “While they are serious about dealing with corruption, many companies still foster a culture that views these incidents as a private matter, so they continue to balk at airing ‘dirty laundry’ in public. In today’s connected, global business world, keeping these matters private is almost impossible to do and may exacerbate problems in the long run.” The study also revealed the increasing role of internal audit in anti-corruption compliance. When asked to select up to three sources that would likely lead to changes in the respondents’ organizations, advice from internal auditors was identified by 57 percent of respondents as most likely to lead to changes in an anti-corruption program, while compliance and internal audits were selected by 80 percent of respondents as one of the best ways to measure a program’s effectiveness. In addition, 47 percent of those surveyed said that integrating an anti-corruption program into their internal audit system would make detection and prevention of corruption easier, with an additional 33 percent indicating that it is already integrated. “Many of the corruption cases result from an absence or breakdown of anti-corruption controls, allowing instances of fraud and bribery to metastasize out of control. The increasingly sophisticated nature of corrupt practices requires, as part of a company’s overall anti-corruption program, proactive transaction testing of higher risk business operations by personnel trained to spot potentially corrupt activity,” said Rial. Other findings from the study include:
Deloitte contracted the Economist Intelligence Unit to conduct a survey of general management, finance, strategy and business development professionals around the world regarding global corruption. The survey was conducted from June 25 to August 4, 2008 through an online questionnaire. The 329 survey respondents were drawn from the Economist Intelligence Unit's global executive survey panel. Among the executives participating in the survey, 46 percent were board members or members of the C-suite and 50 percent were management level. Respondents were predominantly from the financial services (19 percent), IT/technology (11 percent) and manufacturing (9 percent) industries. Global revenues for participants’ organizations were (in U.S. Dollars): more than $10 billion (35 percent); $5 billion to $10 billion (14 percent); $1 billion to $5 billion (28 percent); and $500 million to $1 billion (23 percent). Respondents were individually located in Asia-Pacific (30 percent), North America (28 percent), Western Europe (25 percent), Middle East and Africa (7 percent), Eastern Europe (6 percent) and Latin America (4 percent). |
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