Survey: Senior managers failing to foster a culture of ethical behaviour

Business Reporter -

MUSCAT, MAY 3 -

Despite sporadic progress in tackling bribery and corruption across Europe, the Middle East, India and Africa (EMEIA), 43 per cent of MENA respondents to the biennial EY EMEIA Fraud Survey still perceive it to be a problem in their country.

The report, ‘Human instinct or machine logic — which do you trust most in the fight against fraud and corruption?’ surveyed 4,100 employees from large businesses in 41 countries across EMEIA.

Senior management are failing to foster a culture of ethical behaviour finds the survey: 57 per cent of MENA respondents do not believe that management has emphasised the importance of high ethical standards. Nevertheless, 48 per cent of respondents believe that regulation has had a positive impact on deterring unethical behaviour, a significantly higher percentage than global respondents (28 per cent), with 83 per cent of MENA respondents agreeing that the prosecution of individuals would help deter fraud, bribery and corruption by executives.

Globally, the Generation Y cohort (25 to 34 year olds), who constitute 32 per cent of respondents, demonstrate more relaxed attitudes toward unethical behaviour the survey finds. Seventy-three per cent state that such behaviour is justified to help a business survive, compared with 49 per cent of 45 to 54 year olds (Generation X) surveyed who hold this view. Furthermore, 68 per cent of Generation Y respondents believe their management would engage in unethical behaviour to help a business survive, and 25 per cent of this age group would offer cash payments to win or retain business.

Generation Y also show a heightened distrust of their co-workers, with 49 per cent believing that their colleagues would be prepared to act unethically to improve their own career progression, compared with 40 per cent across all age groups.

Despite the fact that whistleblowing hotlines are now considered an important part of a company’s compliance programme, only 21 per cent of MENA respondents were aware of such a channel in their company, while 50 per cent would refrain from reporting an incident due to concerns about career progression.

Michael Adlem, EY MENA Fraud Investigation & Dispute Services Leader says: “Reporting incidents of unethical behaviour still remains an issue. Employees are either unaware of the correct channels, or more worryingly, are apprehensive to highlight wrongdoing, which shows a lack of leadership from senior management to tackle the issue. Companies need create more awareness about their whistleblowing channels and communicate appropriate processes to ensure employees know where to go when they encounter unethical practices.”