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Business corruption still high, companies still ill-equipped

Australian and New Zealand companies are being affected by bribery and corruption, according to results from a Deloitte survey.

The Deloitte Bribery and Corruption Survey 2015 revealed 23 per cent of companies have experienced one or more instances of corruption in the last five years.

Of the 40 per cent of companies that operate in “high-risk jurisdictions”, 35 per cent of respondents said they have experienced instances of bribery and corruption since 2010.

“The risk is actually higher than ever and, for many organisations, it will only be a matter of time before a corrupt offer or demand is made and someone gives in to a temptation and takes advantage of a control gap,” Deloitte Forensic partner Frank O’Toole said.

The findings, sourced from interviews with over 250 Chief Financial Officers, Chief Risk Officers, and others responsible for risk management, revealed that 23 per cent of organisations with offshore operations are not worried about risks resulting from non-compliance with legislation. 77 per cent of those without concern are yet to undertake a risk assessment.

“Our 2015 results show a significant drop, from 49 per cent in 2012 to 5 per cent, in the number of organisations with offshore operations that don’t believe a risk assessment applies to their organisation,” Mr O’Toole said.

“But at the same time, there has been an almost commensurate rise in the number that haven’t undertaken an assessment.”

Mr O’Toole said almost half the respondents said they were dealing with developing countries, with almost 84 per cent of these revealing that their overseas operations took place in high risk jurisdictions.

“Some of Australia’s and New Zealand’s biggest trading partners are considered higher risk countries, and a number of these, particularly China, India and Indonesia, have begun to prioritise and increase their corruption enforcement efforts.”

“That many organisations with offshore operations don’t regard foreign bribery and corruption as a serious future risk is a concern, and there are still too many not giving bribery and corruption the attention it deserves.”