Ernst & Young on Fraud and Corruption in 2017

Fraud and Corruption in the MENA . . .

In a report of Ernst & Young on fraud and corruption in 2017 it is said in its Executive summary that “Today’s businesses are operating in an uncertain economic environment. Popular discontent with globalization, political instability and slower growth in emerging markets is placing pressure on companies as they seek alternative ways to meet ambitious revenue targets.”

It is also advocating that “Restoring confidence through enforcement as “Bribery and corruption remains a challenge and business conduct is under greater scrutiny from both regulators and the public than ever before. The majority of our respondents support the strong stance taken by regulators, particularly respondents in emerging markets.”

The report, titled ‘Human instinct or machine logic – which do you trust most in the fight against fraud and corruption?’ is the synthesis of a survey of 4,100 employees of large businesses in 41 countries across EMEIA.

It was already highlighted back in 2015 in similar report of EY that generally “The cost of unethical behaviour has never been higher” than that of that year.

Although sporadic progress were acknowledged to have taken place in the struggle against bribery and corruption in most countries of Europe, the Middle East, India and Africa (EMEIA), almost half of the surveyed by EY of the MENA region reported their concern and still feeling that it is a rampant problem in their own country. In other words good morality is definitely not there in business.

Whistle-blowing when things get eventually out of hand might be a way out but how to do would be crutial as to how.  Hotlines are now considered an important part of a company’s compliance program in the MENA and only few respondents were aware of such a channel in their company, whilst half would not allow themselves as if to salvage their career first and foremost.

In our view and in so far as the North African half of the MENA region is concerned, we would like to think that it is widely acknowledged that the domestic business informal sphere of these countries’ account for no less than 50% of their respective economies.  Can we therefore assume that a sizable portion of that informal sphere being carried out outside any radar coverage is of doubtful nature, meaning possibly tainted with burrs for most close to the ground and lots of well-known politico-economic blunders for the different leaderships.  These were found at 57% of MENA’s respondents not believing that business management do not emphasize enough high ethcal standards.

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