A new report from the Association of Chartered Accountants (ACCA), Bribery and corruption: The hidden social evil on your doorstep, delves into the true extent of how bribery and corruption impact small and medium sized enterprises (SMEs) across the world, highlighting the pressing need for enhanced transparency and robust regulatory frameworks.
The research shows a high prevalence and deep concern about the damaging impact of bribery and corruption on SMEs, with more than half (59%) of SMEs and their advisers believing that standing up to bribery and corruption will cost them business trade or opportunities. The UK appeared more relaxed, with 46% thinking taking a stand would cost them.
Yet the survey also reveals a strong understanding of the benefits of standing up to bribery and corruption. 77% of global respondents, and 67% of UK respondents, agree that having a strong anti-bribery policy boosts customer confidence in their business. Furthermore, 68% globally and 68% in the UK say it increases their chances of getting lucrative contracts with big businesses and public sector bodies.
Commenting on this, ACCA head of tax and business law, Jason Piper, said: “Corruption is a poison; it distorts markets, stunts economic growth, and deters investment.
“Many very small businesses don’t have the bargaining power to refuse when small bribes are demanded of them. Entrepreneurs have to choose between paying the bribe or losing the business – and often that is no choice at all for someone trying to support a family.
“Our report aims to arm businesses and regulators with the necessary insights and tools to root out corruption and foster an environment of transparency and trust. This could include the use of the latest digital tools. Just as technology is being used by criminals, so regulators and enforcement agencies should embrace it in the battle to detect, prevent and respond to them.”
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By GlobalDataDrawing from a broad spectrum of global data, expert opinions, and real-world case studies, the report explores the multifaceted impacts of corrupt practices on SMEs and economic development. It highlights the severe consequences that businesses can face, including legal penalties and damage to their reputations.
The report also considers the effectiveness of current anti-corruption laws and policies across different countries, suggesting that while some progress has been made, much remains to be done to align international efforts.
Piper added: “As global markets become increasingly interconnected, the imperative for accountability and ethical business practices becomes more pronounced.”
ACCA head of technical and strategic engagement, Glenn Collins, added: “Bribery and corruption are global issues, but it is encouraging to see SMEs agreeing stringent anti-bribery policies in fact boost business prospects. Our latest report will help educate readers about the threat and extent of modern-day corruption, and how best to tackle it.”
ACCA as noted that it hopes this report will serve as a catalyst for change, encouraging entities across all sectors to evaluate their practices and align with the best standards of business conduct. The report is recommended for business leaders, policymakers, and regulatory bodies worldwide committed to uprooting corruption and fostering a fairer business environment.
The full report can be accessed here.
