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US regulators investigate Australian subsidiaries
The adequacy of local anti-corruption measures has been put under the spotlightAt least two Australian subsidiaries of US companies have undergone significant reviews by US investigators into…
Lawyers Weekly
The adequacy of local anti-corruption measures has been put under the spotlight
Of late, breaches have resulted in significant fines: a recent example by an electrical engineering multinational resulted in up to US$2.4 billion. Locally, investigations into possible breaches in one Australian subsidiary resulted in up to 60 interviews within that company relating to transactions spanning more than a decade.
Alarmingly, however, the Deloitte survey shows that one in five (22 per cent) of senior executives of large corporations around the world have serious doubts about whether their own anti-corruption program adequately addresses the risk of corruption in their industry.
Further, analysis of the results of Fortifying Anti-Corruption throughout Today's Corporation reveals that Asia Pacific respondents are even less confident than their US and Western European counterparts about the adequacy of their anti-corruption practices (23.2 per cent in Asia Pacific, compared to 18.7 per cent in the US and 16.9 per cent in Western Europe respectively). By far, however, the most doubtful are Eastern European respondents (42.1 per cent).
According to Deloitte Asia Pacific Leader of Forensics, Tim Phillipps, the findings must ring a bell with the many Australian corporates doing business in Asia and beyond.
"Current economic conditions increase the risk of fraud, bribery and corruption and will often create conditions in which corruption is more readily identified, and yet tends to get lessening levels of attention due to more pressing and urgent business matters," he said. "However, managing corruption risk is a paramount business concern in these volatile times."
Asia Pacific participants in the survey, who represented 30 per cent of the 329 respondents, were also significantly less confident in whether the programs address risk according to the geographic areas in which they do business (30.3 per cent in Asia Pacific compared to 15.2 per cent in North America and 21.7 per cent in Western Europe).
"This reveals that Asia Pacific respondents are particularly aware of the influence of culture and geography when it comes to corruption risk in the region," Phillipps said.
The survey goes on to reveal that considering the risk, roughly one-third of all respondents (32.1 per cent), no matter where the location, believe that more should be spent on anti-corruption programs.
- Mark Phillips
