News release
Michael Wiget
Media Relations
Phone: +41 (0) 58 286 43 07
[email protected]
“EMEIA Fraud Survey 2017” by EY
Corruption, fraud and bribery: almost one-fifth of Swiss workers
think they are becoming more widespread

For the second time running, there is a greater perception of corruption in
Switzerland: 18% of those asked think corrupt practices are widespread.

In Switzerland, paying in cash is a matter for discussion: 14% of those asked
think it is a legitimate way of propping up your own business.

Major challenge: 25–34 year-olds are more corrupt than other age groups and
assume that management is also corrupt.

People working in the financial industry are more open-minded about supervision
and think regulation has a positive role to play in combating fraud.
ZURICH, 16 APRIL 2017 – Switzerland’s hands are getting visibly dirtier: for the second time
running, there is a greater perception of unethical conduct going on. Nearly one out of every
five workers in Switzerland now thinks bribery and corruption are widespread in the country,
according to a new survey of larger firms conducted by the advisory company EY. This figure,
though, is still well below the 33% average for Western Europe. Across all 41 countries in
Europe, Africa, the Middle East and India in which the survey was conducted, 51% of
managers take it as read that corruption and bribery are widespread in their country. At the top
of this inglorious league are Ukraine, Cyprus, Greece and Slovakia. Only Scandinavian
countries perform better than Switzerland. Only 6% of respondents in Denmark think improper
business practices are widespread there. That Germany’s figure – now 43% – has increased
sharply gives cause for concern.
Moreover, over a third of Swiss respondents said they had evidence of unethical practices in
their own company, compared with 45% in Western Europe as a whole. The most corruption, it
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appears, is to be found in Turkish and Indian firms, where over three-quarters of respondents
said they had seen people behaving unethically.
Polished financial results suspected in 20% of companies
Every fifth person in Switzerland taking part in the survey assumes that Swiss companies often
make their financial results look better than they actually are. Half the respondents in Austria
took this view, and the figure in Germany was 42% – well above the overall average of 39%.
Switzerland came off less well when it came to using cash as a means of bribery. This is seen
as justified by 14% of respondents in Switzerland where the object is to help your own
company come out of a downturn unscathed. That figure is 4% higher than in Western Europe
as a whole.
“Despite the constantly growing awareness of corruption and bribery in Switzerland, the
country hasn’t generally become more corrupt. The results can be explained by three factors in
particular: the many public scandals have made people more aware of corruption; people quite
simply notice unethical behavior more readily; the law is also better enforced, so that more time
and effort are put into prosecuting and punishing white-collar crime. It should also be borne in
mind that Switzerland is an exporting country that comes into frequent contact with corruption
through subsidiaries, suppliers and customers,” says Michael Faske, Partner and Head of AntiFraud at EY Switzerland, summing up the most important findings about Switzerland.
Future leaders act unethically
Young professionals prefer collaborative working, do not get tied up in the details, value a
work-life balance and evidently often display unethical behavior: among the 25–34 year-olds, a
higher proportion of individuals compared with all other age groups are prepared to justify
unethical behavior in order to save the company or to boost their own career. One in four of the
young survey respondents justify offering bribes in order to win a new order or make progress
with existing ones. No more than one in ten of the 45+ age group said they would act in such a
way.
Besides greater willingness to offer bribes, the young generation is also less trusting of
colleagues. They believe more strongly than any other age group that they would act
unethically in order to climb up the career ladder more quickly or to earn more money. And
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more than two-thirds of young employees believe that their management would behave
unethically if it meant saving the company.
Companies and trainers required
“The results are alarming. These young people are tomorrow’s leaders. If no steps are taken to
put in place high ethical standards and address problematic behavior at all levels, unethical
behavior will continue to increase in the future. Companies need programs to motivate all the
employees to act ethically. Gaps between the generations must be identified and overcome.
Training and targeted awareness raising are also important in order to encourage employees to
report their concerns. However, universities and training companies are also encouraged to
respond to these results,” explains Michael Faske.
Unethical behavior never pays off
The business practices at large international companies are being monitored more closely than
ever. The public is increasingly demanding that companies be held accountable. The G20
states, the OECD and the World Bank are leading this development, with internationally
networked regulatory authorities also contributing. Most respondents to the survey appear to
be happy about this approach; 77% of them are in favor of managers specifically being held
accountable for misconduct. The study also shows that 28% of respondents – 8% more than in
2015 – take the view that regulations have a positive impact on the ethical standards in their
companies. This applies above all to emerging markets.
“Around the world, many countries are reverting to protectionism, growth in hopeful emerging
countries remains below expectations, military conflicts are slowing down many companies and
uncertainty is generally on the rise. Some managers are therefore evidently tempted to resort
to unfair means. However, this is a very dangerous strategy and is by no means sustainable.
Violations can result in financial consequences that threaten the existence of the company and
damage its reputation in the long term. By contrast, the aim for a company that is modern and
successful in the long term must be to build up trust and to make long-term investments in loyal
employees and stable customer relations,” says Michael Faske following the survey results.
Financial industry takes more favorable view of regulation
The survey also reveals differences between sectors. For example, the 646 respondents in
total from the financial industry are more firmly convinced than people in any other sector that
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what the regulators do has had a beneficial influence in promoting proper conduct; 41% of
them agreed that that was the case. People working for banks and insurance companies are
much more likely than average to be familiar with whistleblowing hotlines, with one-third of
them saying their firm offered one, compared with one-fifth in all sectors overall. People
working in the financial industry would also be much more likely to report well-founded
suspicions to the regulatory authority than to the police. Generally speaking, the tendency is
the other way round.
People working in the financial industry also take a less critical view of being monitored. Not
only do they show more understanding for the need for staff to be supervised and for the use of
research tools, but they are also less likely to feel that their privacy has been violated if the
company monitors their own communications. Indeed, 19% of all respondents say firms need
to monitor their employees’ emails in order to reduce the risk of corruption, bribery and fraud,
compared to 28% in the financial industry. And while 58% of financial industry employees see
this as a breach of privacy, 65% of respondents overall do so.
“There’s been a lot of new regulation since the global financial crisis, with financial institutions
working hard to bring about a change of culture, and these are evidently having an effect.
Although banks and insurers have more new rules to comply with than do other sectors, there
is a recognition that this does help to promote ethically unobjectionable conduct. And there’s a
more sympathetic attitude toward the monitoring of staff: bankers have certainly learned some
lessons over the past ten years,” says Michael Faske.
About the study:
Between November 2016 and January 2017, we conducted a total of 4,100 interviews with employees in
41 countries in Western Europe (1,500, of whom 100 were in Switzerland), Eastern Europe (1,700), the
Middle East (500), India (100) and Africa (300). A selection of the largest companies in each country was
taken into consideration for the survey. The surveyed employees included top management, middle
management and other employees. The interviews were held anonymously in the local language.
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