Asian firms lag in fighting corruption, survey finds

Even as Beijing steps up its crackdown on corruption, companies in China and the rest of the Asia-Pacific region are inadequately prepared for the risk of corruption investigations, said Chris Fordham, a managing partner at Ernst & Young.

The recent investigations of companies including GlaxoSmithKline and China National Petroleum Corp demonstrated the increased level of enforcement in China, Fordham said. "The disconnect is, we are seeing greater enforcement by governments, yet companies are lagging behind. This is going to put companies at risk in Asia-Pacific."

An E&Y survey earlier this year found 40 per cent of the respondents had anti-bribery policies in place at their companies, compared with a global average of 81 per cent last year.

This year's survey polled 681 executives in China, Singapore, Australia, New Zealand, Indonesia, Vietnam, Malaysia and South Korea.

It found 48 per cent said their companies' anti-bribery policies were good in principle but not in practice. For example, 81 per cent said they were willing to use whistle-blowers to expose corruption, but only 32 per cent said their companies had an apparatus to support whistle-blowers.

In China, 19 per cent said fraud and bribery had increased due to difficult economic times and greater competition, while 34 per cent said their managements were likely to take short cuts in tough times. About 21 per cent said corruption was widespread, higher than the global average of 14 per cent.