Anecdotal stories plus growing media focus point to corruption being on the rise. Have you considered what this can do to your business? A fourteen country survey of companies by Price Waterhouse Coopers pointed to growing fear of corruption. What the survey said
- 63% of companies have experienced some form of corruption
- 55% say the biggest fallout from corruption is damage to the company’s reputation
- 39% have lost a bid due to corruption
- 70% think an understanding of corruption will enable their business to make better decisions, become more competitive and enter new markets
What is happening locally? Major legislation has been passed. The Prevention and Combating of Corrupt Activities Act was passed in 2004. Regulation 43 of the new Companies Act, 2008 instructs state owned companies, listed public companies and other companies with a public interest score of more than 500 points in any two of the past five years (i.e. medium to large companies) to set up Social and Ethics Committees. Part of this committee’s mandate is to implement the Organisation for Economic Co-operation and Development’s (OECD) anti-corruption guidelines. These guidelines require implementing controls to prevent corruption. Where does that leave you? It makes sense to, at least:
- Review your customers and suppliers and categorise them by risk of potential corrupt dealings.
- Audit your controls over procurement
- Impress on your staff and stakeholders that corruption is not acceptable in your business
You have no more valuable asset than your reputation – take steps to protect it!