A survey has found that more than a quarter of Australian employees (27%) believe it is common practice in their industry or sector to use bribery to win contracts while 31% believe Australian companies often report financial performance as being “better than it is”.
Additionally, the Asia Pacific fraud survey from professional services firm EY found that 23% of Australians believed there ware no clear penalties for breaking their firms' anti-bribery/anti-corruption (ABAC) policies.
Many of the Australian businesses believed their organisations would be at increased risk of being a victim of cyber attacks over the next few years and they wanted corporate policies combating fraud, bribery and corruption to be simplified to ensure improved compliance.
The survey found that 51% of Australian respondents saw increased risk of cyber attacks, but more than 9 in 10 (93%) said they wanted to work for a compliant organisation but were confused by inconsistent compliance policies that lacked clarity and were clouded in legal jargon.
{loadposition peter}In fact, 35% of Australian respondents believed their organisation’s current code of conduct had little impact on how employees actually behaved, while 39% said they believed bribery and corrupt practices happened widely in Australia.
And, while only 54% of APAC respondents believed their ABAC policies were relevant and effective, in Australia 26% of respondents said they would shorten their existing policies to ensure key messages did not get lost, and 23% would simplify the language so it wasn’t overly complicated or composed of legal jargon.
Chris Fordham, EY Asia-Pacific Leader, Fraud Investigation and Dispute Services, said the survey highlighted the significant impact ethical conduct has on hiring and retaining employees, with more than three quarters (79%) of Australian respondents stating they would look for a new job if their organisation was involved in a major fraud, bribery or corruption case.
“Employees are demanding absolute clarity and anything short of that impacts morale, hiring, retention and overall business performance. Corporates need to simplify their compliance protocols to ensure employees follow them,” Fordham advised.
He said slow economic growth, coupled with growing pressure to exceed the business bottomline, was taking its toll on Australia’s ethical conduct, with close to a third of Australian respondents (32%) believing bribery and corrupt practices had increased because of tough economic conditions and increased competition.
“What’s most concerning for Australian business is the overwhelming belief that achieving economic targets trumps the need for ethical behaviour,” says EY Oceania managing partner, Fraud Investigation & Dispute Services, Rob Locke.
“Our survey revealed that despite wanting to work for ethical organisations, 17% believe it is justified to deliberately misstate a company’s financial performance to meet financial targets. A further 20% of respondents believe it is justified to amend financial reports to provide a more positive outlook on results.
“CEOs, boards and senior management not only play an integral role in setting compliance policies but have a responsibility to ensure the wider company is following them. With 43% of Australian respondents believing people with questionable ethical practices are seen to be promoted, Australian business leaders need to recognise that perception is reality when it comes to ethical conduct.”
The survey also found that 61% of APAC respondents said they had a whistleblowing hotline within their organisation.
But when it came to reporting unethical acts, employees were reluctant to use the existing internal whistleblower hotlines as they did not trust their organisation would protect their anonymity or follow-up with proper remedial actions. Nearly a third (28%) said they would prefer to use external law-enforcement hotlines and even social media channels to report misconduct instead.
In Australia, the EY survey showed that increased regulatory scrutiny and activity continued to have an impact on employee willingness to use whistleblowing hotlines, with 27% of Australian respondents saying they would be most comfortable reporting misconduct directly to their senior manager.
And despite the growing presence of whistleblowing policies, almost one in five (17%) Australian respondents said they had withheld information or concerns due to internal pressures.
“It’s encouraging that more companies in Asia-Pacific now have whistleblower hotlines. But we’re concerned that employees still don’t have enough faith that their reports will be handled confidentially or that these reporting mechanisms will result in proper follow-up and punishment for the guilty parties,” Fordham noted.
According to Locke, the Asia-Pacific region could no longer afford to be complacent when it came to cyber threats and, while companies often thought of cyber attacks as external threats, they would be well advised not to ignore the very real threats posed internally.
“Current cyber policies are inadequate in safeguarding against rogue employees and criminals who are intent on stealing data, intellectual property and even cash. Given 40% of Australian survey respondents say they do not have a policy in place for using personal devices at work, companies must design and enforce policies that help mitigate the risk of both external and internal cyber attacks,” Locke concluded.