Impact of Covid-19: Standards of corporate integrity on the decline around the world, including India, says a study
CHENNAI: India Inc is staring at an "integrity crisis" in the second year of the pandemic, a PTI report, quoting a global survey conducted by the consultancy firm EY, says.
The survey reveals that more than half (55 per cent) of employees and leaders from companies around the world, including India, believe that standards of corporate integrity have stayed the same or worsened over the last 18 months
While a record (97 per cent) respondents to the survey agree that integrity is important within their organizations, 41 per cent say that the COVID-19 pandemic is making it more difficult to act with integrity in business dealings.
The survey, which canvassed the views of more than 4,700 employees, managers and board directors from 54 countries and territories, found that leaders are struggling to create and communicate a strong and effective culture of integrity within their business.
In a statement issued relating to the survey, Andrew Gordon, EY Global Forensic & Integrity Services leader, says: “The COVID-19 pandemic has had a serious impact on integrity standards for companies around the world. The change to ways of working throughout the COVID-19 pandemic has created a heightened risk of fraud and unethical behavior. Hybrid working makes it difficult to undertake effective compliance monitoring, and fraud risk factors typically increase at a time of crisis because companies and individuals face more financial pressures.”
There is also a gap between the views of board members and employees in relation to awareness of policies on working from home (80% vs. 51%) and awareness of training on data privacy regulations (52% vs. 35%), the survey shows.
The survey highlights a further disconnect when it comes to behavior. There appears to be a willingness among the most senior executives to act outside the compliance rules. Board members who were questioned as part of the research were five times as likely as employees to falsify financial records (15% vs. 3%) and six times as likely to say they would be willing to mislead external third parties such as auditors (18% vs. 3%).
Gordon says: “A progressive integrity agenda goes beyond frameworks and policy – businesses must look beyond box ticking and focus on creating an integrity culture at all levels within their organizations. Leaders should be under no illusion that integrity is an easy fix; however, the first step is setting the right tone from the top.”