Indians justify bribe for business
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Mumbai: Offering cash payments to win or retain business can be justified according to employees in India; they also say they have compliance requirements and procedures for ethical practices, but these are not followed in spirit.
Sixty-nine per cent believe that bribery and corruption are widespread in the country. These were some of the findings of Ernst &Young’s (EMEIA) Fraud Survey 2013.
The survey covered 3,000 employees in 36 countries across Europe, Middle East, India and Africa (EMEIA) and over 33 per cent of the respondents felt that corruption and bribery to win or retain business could be justified.
This was three times more than their Western Europe counterparts, said Arpinder Singh, India leader of E&Y’s fraud investigation and dispute services practice. The survey found that “performance pressures in difficult times makes way for unethical practices in India.”
Forty-three per cent of the respondents said they were witnessing downward pressure in terms of reduction in remuneration and removal of bonus to be hitting business more in the rapid-growth markets where the battle for talent remains fierce.
Seventy-four per cent agreed that their managers will be under increased pressure to deliver good financial performances over the next year. “This is a risky combination. In some cases it can drive actions that could damage the business such as fraud, bribery,” said the report.
Singh said one of the issues that came through in the survey was that most foreign companies felt that there was no level playing field in India.
Foreign companies are governed by the corrupt practices act of their countries which are strictly implemented, whereas in India whilst there are anti-bribery and anti-corruption (ABAC) rules as good as anywhere in the world, they are not strict on compliance.
The survey results, he said, serve as a warning for MNCs with subsidiaries in India where 54 per cent think that the financial performances is often exaggerated.
Almost half the respondents in the rapid growth markets agree that companies in their countries often misrepresent financial performance, compared with 29 per cent of those with headquarters in Europe.
Singh said the survey also showed a compliance perception gap between management and employees. Nearly half the respondents did not consider ABAC programmes relevant to their roles.
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