Survey ‘highlights a marked increase in bribery and corruption in SA’

South Africa is one of eight bribery and corruption hotspots on the continent with a steep increase in incidents in the past 24 months‚ law firm ENSafrica's 2016 anti-bribery and corruption survey has found.

The survey reveals a significant increase in incidents of bribery and corruption in Africa‚ with 79% of incidents reported in South Africa.

Eighty percent of the survey's 132 respondents are situated in South Africa. Most respondents came from the financial services‚ manufacturing‚ retail and wholesale sectors.

“The survey results show that 39% of respondents experienced incidents of bribery or corruption in the last 24 months‚ and highlight a marked increase in bribery and corruption in South Africa in particular‚” ENSafrica said.

Other countries on the hotspot list are Mozambique‚ with 12% of the reported incidents‚ Kenya‚ with 9%‚ Namibia‚ 7%‚ Ghana‚ 7%‚ Tanzania‚ 5%‚ Democratic Republic of Congo‚ with 5% and Uganda‚ with 5%.

The survey’s key findings relating to perceived bribery and corruption risks included:

- 27% of respondents said they were highly exposed to bribery in Africa - up from 17% in 2015 - while 57% said they were moderately exposed;

- 76% said that “the use of third parties” posed a significant risk to their company - up from 68% in 2015 and 65% in 2014;

- 52% said they were exposed to the risk of bribes and 48% to the facilitation of payments. The exposure of employing government officials or their relatives jumped from 8% in 2015 to 21% in 2016;

- 92% of respondents indicated bribery or corruption would impact most on their “corporate reputation”‚ followed by financial loss‚ possible debarment from government contracts or trading and a negative impact on share price; and

- 53% of respondents believed they were “somewhat prepared” to respond to an anti-bribery and corruption compliance investigation by a regulator‚ while 10% believed they were “not well prepared”;

ENSafrica's head of forensics‚ Steven Powell‚ warned firms of the dangers of non-compliance with anti-bribery and corruption policies relating to the reporting of incidents.

“The importance of whistleblower hotlines cannot be over-emphasised‚ as they provide employees and third parties with a vital channel to report suspected incidents of bribery and corruption to senior management.

“Of concern is that 20% of respondents indicated that their companies did not have a whistleblower hotline in place. For companies without such a system‚ it is highly advisable that a robust whistleblower reporting channel is implemented.”

ENSAfria also reminded companies that corrupt activities may be brought to book on foreign shores.

“With a global intolerance to bribery and corruption‚ corporates in Africa may incorrectly believe that they can escape the reach of foreign regulators.

“United States regulators are monitoring the corruption landscape in Africa‚ as evidenced by the FBI’s arrest of the son (Samuel Mebiame) of a former Gabonese prime minister‚ for allegedly paying bribes on behalf of a United States company in‚ among others‚ Zimbabwe‚ the Congo and Libya."

The criminal complaint against Mebiame‚ filed in New York‚ alleges he “routinely (paid) bribes to foreign government officials” to get mineral rights companies‚ including Cape Town multimillionaire Walter Hennig's Palladino Holdings.

– TMG Digital