Corruption, fraud link to doing business

PETALING JAYA (Jan 13, 2014): As a survey showed scores of senior officials of public-listed companies feeling that fraud, bribery and corruption are inevitable costs in doing business, Malaysian Anti-Corruption Commission (MACC) chief Tan Sri Abu Kassim Mohamed stoutly denied the charge.
The survey by KPMG Malaysia as part of its “Fraud, Bribery and Corruption Survey Report 2013” also revealed that 64% of respondents, mostly management heads from 100 public-listed companies, believed that business in Malaysia would not be able to proceed without the paying of bribes.
They felt that the three negative elements are part of business costs in Malaysia.
Nearly 80% of the respondents believed that bribery and corruption has increased over the past three years with 61% indicating that their companies lack adequate monitoring procedures on bribery and corruption.
In addition, 33% of respondents believed that influencing business decisions through bribery and/or corruption occurred in more than 10% of the cases.
The survey revealed that 33% of the respondents are also largely unfamiliar with the Malaysian Anti-Corruption Commission (MACC) Act 2009 with not a single respondent claiming to be “very familiar” with the Act.
KPMG managing partner Johan Idris said the mindset that fraud, including bribery and corruption, is part and parcel of doing business is rather dangerous.
“It could result in the cultivation of a somewhat lenient and tolerant attitude towards the occurrence of fraud, with organisations merely reacting to fraud instead of taking proactive steps to nip it in the bud,” he said.
The survey, conducted between January 2010 and December 2012, also found an increase in the perception of fraud with 89% of respondents feeling that the quantum of fraud had increased over the past three years while 94% thought that fraud had become more sophisticated.
Meanwhile, Abu Kassim, who launched the report, felt that the outcome of the survey contradicted the fact that Malaysia is ranked sixth in the world in terms of the ease in doing business.
“There is also the issue of corruption (based on the survey). These are two different things and I look at it contradicting one another.
“How can you easily do business when at the same time, you have big problems of corruption or a perceived problem of corruption?” he said.
Abu Kassim added that the assessment made through the survey is a perspective from the private sector, adding that it will be looked at objectively.
“Addressing corruption in the private sector is going to be more and more important in our way of shifting our role in fighting corruption in this country,” he said.
He said the main factors behind bribery include the nature of business, the behaviour of the company or those in the company and the awareness in society.
He acknowledged that education could be the answer to fighting bribery and corruption.