Lax Kiwi systems 'open to bribery'
The Canterbury rebuild is creating an environment ripe for bribery and corruption, thanks to New Zealand organisations' almost complete lack of systems for mitigating the risk.
This is the view of corruption experts, as accountants Deloitte publishes a survey of Australasian businesses showing they are ill-prepared to deal with the issue.
Increasingly New Zealand and Australian companies are trading with, and have operations in, countries where corruption is rife, but few have formal bribery and corruption processes, Deloitte says.
Of the 390 firms surveyed - about half of them Kiwi - 34 per cent have operations in high-risk jurisdictions. Of these, one in five had had a bribery and corruption incident in the past five years.
However, nearly half have no formal policy or compliance programme to deal with it, and 80 per cent do not regard bribery and corruption as one of the top five risks to their business.
The world is a different place from the 1970s when nearly all of New Zealand's trade was with countries such as Britain, the United States and Australia, said Lorinda Kelly, associate director of Deloitte Forensic. "But we've still got that mindset of corruption's not really a big deal and it's not something we have to be concerned about."
Nick Paterson, general manager of fraud and corruption at the Serious Fraud Office, said the Christchurch situation was of concern, because of the amount of money being spent. "Fraudsters generally follow the money.
"We are currently working with other agencies to see what we can do in terms of more of a prevention and protection role."
The Government-appointed Canterbury Earthquake Recovery Authority (Cera) said it was working with other agencies on the management of the risk of potential bribery and corruption.
The annual reviews of the Canterbury Earthquake Recovery Act, select committee processes, Office of the Auditor-General, Office of the Ombudsman and Official Information Act provided additional layers of oversight and transparency for Cera's work, a spokesman said.
Suzanne Snively, executive chair of Transparency International New Zealand, said Kiwi companies were complacent.
When her organisation had done surveys it had found "a complete absence" of processes or systems to deal with corruption.
- © Fairfax NZ News
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