Risk of unethical conduct in corporate India magnifies due to COVID-19 disruptions: Survey

New Delhi, Jun 25 () As businesses face severe and widespread disruption in operations, supply chains and workforce due to the coronavirus pandemic, the risk of unethical conduct in corporate India has magnified, according to a survey by consultancy firm EY.

Some of the greatest risks to ethical business conduct because of the pandemic include declining financial performance, disruption to traditional working patterns, reduced focus on ethical behaviour from senior management and weakening compliance processes and controls, according to the EY survey titled 'Global Integrity Survey 2020, Is this the moment of truth for corporate integrity?'

The survey found that a significant number of employees in India remained willing to act unethically for personal financial gain, and the global pandemic is only exacerbating this by increasing the incentives and opening new avenues for them to do so.

"Senior employees are more likely to justify unethical behaviour such as ignoring misconduct in their team, misleading external parties or offering/accepting a bribe to boost their own career progression or remuneration," it said.

The EY survey said 69 per cent of respondents believed that there are managers in the organisation who would sacrifice integrity for short term financial gain. This was higher than the global figure which stood at 43 per cent.

Further, 57 per cent would be prepared to act unethically to improve their career progression or remuneration package. 32 per cent would be willing to falsify customer records, 31 per cent would ignore unethical conduct by third parties and 29 per cent would provide false information to management, it added.

The survey also found that 64 per cent believed that unethical behaviour is often tolerated when involving seniors or high performers.

However, 77 per cent stated that integrity standards have improved in their organisations in the last two years, and 90 per cent said it is important to be able to demonstrate that their organisation operates with integrity.

Yet, 92 per cent say they would be concerned if information about decisions taken by management were subject to public scrutiny, much higher that global at 54 per cent, the EY survey stated.

Commenting on the findings, EY Partner and Head – India and Emerging Markets, Forensic & Integrity Services Arpinder Singh said, "The COVID-19 pandemic struck the business ecosystem to its core, propelling management to deal with operational distress and business continuity with urgency.

"As tough decisions are being taken amid the crisis, the risk of unethical behaviour and compliance infractions has increased and can weigh heavily on organisations."

Turbulent times like these can have corporate integrity becoming a true differentiator as organisations concentrate on encouraging ethical conduct, building trust in third party partnerships, protecting data and circumnavigating the risks present now, next and beyond, he added.

EY said survey research reveals insights from business leaders on the myriad of ethical challenges facing organisations, both in the lead-up to and at the height of the COVID-19 crisis.

Global market research agency Ipsos MORI conducted the survey for EY between January and February 2020, taking response from 2,948 people, including board members, senior managers, managers and employees in the local language, in a sample of the largest organizations and public bodies in 33 countries and territories worldwide.

Further, 600 interviews in total were conducted in April 2020 using the same respondent profile across China, Germany, India, Italy, the UK and the US during the COVID-19 pandemic, EY said. RKL MR MR