Having a strong anti-bribery policy boosts customer confidence and can help small businesses win large contracts, new research claims.
A new report from the Association of Chartered Certified 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.
Jason Piper, ACCA’s head of tax and business law, 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.”
Drawing from a broad spectrum of global data, expert opinions, and real-world case studies, the report explores the 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.
Jason added:
“As global markets become increasingly interconnected, the imperative for accountability and ethical business practices becomes more pronounced.”
Lloyd Powell, head of ACCA Cymru/Wales, added:
“The threat of bribery and corruption is something that businesses across Wales face on a daily basis. The fact our members are reporting improved prosperity through having anti-corruption policies in place is a good start, but there is more we can do to help them moving forward. How best to address modern-day corruption can be confusing, but we hope our latest report will provide some clear advice on how members can identify and prevent such activity.”
The full report can be accessed here.
