Deloitte corruption survey 2017: “Tip-offs are still the most common method of detection”

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“Organisations need to be proactive and vigilant” says Deloitte forensic leader…

According to Deloitte’s 2017 survey, while Kiwi organisations appreciate the risks associated with bribery and corruption, their response is too slow.

Deloitte New Zealand Forensic leader Barry Jordan says: “Organisations need to be proactive and vigilant if they have any realistic chance of combating bribery and corruption, otherwise they will simply fall behind.”

“Although we are getting much better at identifying the symptoms of commercial and public sector bribery and corruption, whether that is through traditional or social media channels, we have still a lot to learn.”

The improvements in awareness around bribery and corruption are being driven in part by increased requirements from Anti-Bribery and Corruption (ABC) regulation, as well, in some cases, by using advanced detection and training systems.

“Global uncertainty is also increasing this focus,” says Australian Forensic leader Chris Noble. “Our cross Tasman regulators are actively enforcing agendas to minimise money laundering, terrorist financing, corporate misconduct and fraud. There is also greater international cooperation, collaboration and benchmarking between law enforcement agencies to facilitate cross-jurisdictional investigations.”

“This awareness is brought out in our 2017 survey by the fact that tip-offs are still the most common method of detection,” says Jordan. “This supports our experience at Deloitte that an organisation’s staff members are the first and best line of defense in the fight against bribery and corruption….Boards and executives need to set the tone (14%), but what is very important is that middle management have to effectively execute ABC (anti-bribery and corruption) programs on the ground.”

Jordan says that in such volatile and uncertain times, companies cannot afford to be overconfident when it comes to preventing, detecting and responding to foreign and domestic bribery and corruption.

“The message from law makers is clear – bribery and corruption is the focus, and cutting corners to save time is not an acceptable way of doing business. Businesses and the regulators in Australia and New Zealand recognise the risk and will simply not tolerate bribery and corruption,” concludes Jordan.

“The reality is whether you choose to adapt to developing expectations, or deploy the bare minimum to remain compliant in a regulatory sense, will determine whether you stay one step ahead of the ABC edge.”

Forty five per cent of respondents expect to implement or upgrade their ABC framework in the next five years. The International Organisation for Standardisation (ISO) is releasing a global standard for the design and management of ABC programs, ISO 37001:2016.

Read the full Deloitte Bribery and Corruption Survey 2017 at www.deloitte.com/nz/bribery-corruption-survey.

Other facts from the 2017 survey include:

New Zealand has an international reputation to maintain:

  • In 2016 Transparency International’s Corruption Perceptions Index, ranked New Zealand and Denmark jointly as being perceived to have the least corrupt public institutions in the world
  • Despite this, New Zealand had its biggest ever bribery prosecution, ‘Borlase and Noone’, in 2016. This was the first prosecution where the judgement included specific guidance for organisations looking at what should and should not be offered (or accepted) by New Zealand public officials.
  • New Zealand clarifying penalties for foreign corruption and setting circumstances in relation to the liability for companies.

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