Fraud culture starts at the top
21 May 09
A new survey on employees’ attitudes to fraud and unethical behaviour throws some disturbing light on the state of business throughout Europe
Difficult economic conditions create extra pressure on staff at all levels in business. It’s not surprising, then, that the latest European Fraud Survey from Ernst & Young shows that people across Europe expect to see fraud levels rising over the next few years (see News, 21 March).
Over half (55 per cent) of those surveyed expect corporate fraud to increase over the next few years, with the UK taking a slightly more pessimistic view (63 per cent). Only 8 per cent of all respondents think that corporate fraud will decline.
What’s more disturbing is that the survey also reveals that staff generally have low expectations when it comes to the ethical behaviour of their own management. Nearly seven out of ten say they have cause to doubt the integrity of their company’s management.
In the UK, only 23 per cent believe their management “always operates with a high level of personal integrity”. In France and Italy this figure falls to just 12 per cent. There may be an element of truth in the employees’ view, but even if they are underestimating their bosses’ integrity, the very fact that they think this way is a matter for concern.
One of the key factors that allows a culture of unethical behaviour and fraud to flourish is the belief that such behaviour is in fact the norm in your community or organisation. Senior managers must be seen to be above reproach themselves, and they must work hard to make sure that message is understood, if they want to see better standards of behaviour from their staff.