Most employees are aware of unethical business conduct in their organisations,but feel the onus of handling corruption lies with the senior management,a report by industry body FICCI said today. The report titled ‘Bribery and Corruption: Ground Reality in India’ also said sectors that are most vulnerable to corruption include government & public sector,real estate,infrastructure,metals & mining,aerospace & defence,and power & utilities.
Corruption,real or perceived,is having a detrimental impact on the country’s economy,the report prepared by FICCI in association with Ernst & Young added.
According to 73 per cent of respondents from private equity firms,a company operating in a sector that is perceived as highly corrupt may lose when it comes to a fair valuation of business,as the cost of corruption in the sector will be factored in a transaction.
However,the report states that majority of respondents were optimistic that new regulations such as the Companies Bill 2012 will make a difference and help in reducing fraud,bribery and corruption in the country.
It said multinational organisations are under increasing pressure to improve their anti-bribery and anti-corruption compliance programs as jurisdictions around the world increase their enforcement of laws and regulations to combat bribery and corruption.
Corruption invariably increases transaction costs and uncertainty in an economy while lowering efficiency by forcing entrepreneurs to divert their scarce time and money to bribery rather than production,” FICCI President Naina Lal Kidwai said. The report was compiled on the basis of a survey conducted from March to May 2013 via an online questionnaire. The respondents include a mix of Indian enterprises with domestic operations,as well as Indian and foreign multi-nationals in the US and the UK.