European fraud survey 2009: Is integrity a casualty of the downturn?
As the recession in Europe deepens, the ever-present threat of fraud grows stronger. The Ernst & Young 2009 European fraud survey reflects the views of over 2,200 individuals – from the shop floor to the boardroom – in major companies in 22 countries across Europe.
Their insights show that there is an alarmingly high tolerance of unethical business behaviour within organizations. The survey reveals that many employees would tolerate unethical behavior, including bribery by their company, in order to survive the current economic storm. Indeed, senior management are even more likely than rank and file to condone activities such as cash bribes and financial statement fraud.
The research also suggests that employees expect regulators to do more to protect them from wayward management and to ensure their business leaders are compelled to conduct business in an ethical manner.
Other key findings:
- Our survey respondents believe the likelihood of fraud and corruption is set to rise further still. 55% of the respondents expect corporate fraud to increase over the next few years.
- Corporate responses to the downturn can create new opportunities for fraudsters if staff redundancies open gaps in financial controls. 36% of our respondents believe that normal policies and procedures are likely to be overlooked as staff redundancies are made.
- The trend of consolidation during an economic downturn can also disrupt ongoing efforts by corporates to prevent fraud. Almost half of our respondents believe that the differing standards of behavior that are held by two merging companies poses a major challenge to anti-fraud efforts.
Download "European fraud survey 2009: Is integrity a casualty of the downturn?" (pfd, 1mb) to read more about these issues and how benefits from taking action now will be long lasting.
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