GLOBAL RESPONSE TO FRAUD AND CORRUPTION
RC: Could you provide an overview of how fraud and corruption continue to corrode the global economy?
Anjum: Organisations worldwide lose more than 5 percent of their total revenues to fraud, according to a study last year by the Association of Certified Fraud Examiners. When applied to the gross world product, that is a staggering $6.3bn in losses. Companies need to think about that in terms of their own investments and financial health. Can any business leader afford to just write off 5 percent of their earnings? The worst part is that when the money is siphoned off through fraud, it is almost impossible to get those funds back after the fact. It is gone, having already been spent or distributed among a shady network that is difficult or impossible to track. That is why prevention is so important, and so much more effective, than trying to stop fraud after it has occurred.
RC: What do you see as being the main weaknesses of anti-bribery and anti-corruption efforts currently deployed by multinationals? Do more companies need to elevate anti-fraud and anti-corruption initiatives to the boardroom agenda?
Anjum: Many companies are still being reactionary, changing their policies and practices when regulations mandate it. And even then, they become focused on the details of compliance rather than taking a broader look at risks and challenges facing their organisation. For example, many companies still fail to undertake a full-scale fraud risk assessment before any international engagement.
Jul-Sep 2017 Issue
Corporate Research and Investigations Limited