Small change
July 20, 2011
Germany isn't a country with a reputation for being corrupt. But every so often, sensational cases emerge: Siemens, Volkswagen, Deutsche Telekom, Ergo insurance and the public-sector bank BayernLB have all been hit with allegations recently.
However, a new study conducted by London-based professional services group Ernst & Young shows a shifting mentality. In 2009, one in four German businesspeople said bribes were a legitimate way of expanding a business. Nowadays only 3 percent of top German managers and 12 percent of other employees share that opinion.
Not all European countries have witnessed similar developments, however. This year's European Fraud Survey, which gathered data from 2,300 respondents in 25 nations, found that 18 percent of Europe's top managers and 17 percent of other employees still see bribery as a legitimate business tool
Direct correlation
The management consultants at Ernst & Young suspect there is a correlation between tolerance for corruption and the pain companies in various countries felt during the global financial crisis.
The results from Germany underpin the theory; German companies have weathered the crisis better than firm in many other EU nations.
While a consistent 27 percent of those surveyed in Europe said they were worried about the financial stability of companies in their countries, only 4 percent of Germans shared their fears.
"Less pressure has visibly led to higher moral standards in German companies," wrote Stefan Heissner, the head of Fraud Investigations & Dispute Services at Ernst & Young. In other words: Companies with fewer financial problems can afford to concern themselves with ethics and morality.
Spread it around
Throughout Europe, however, two-thirds of the survey's respondents said corruption continues to be practiced in their countries.
Nearly every fifth person surveyed said bribes, presents and "entertainment programs" are acceptable methods of increasing turnover.
Businesses in Greece and Russia are particularly susceptible to bribery, while those in France and Norway are the most honest, according to Ernst & Young.
In Germany, 45 percent of employees said they believe corruption is commonplace in business life. Some 60 percent said that executives may sacrifice ethics to meet their business goals during tough times - an opinion shared by 78 percent of top managers themselves.
That's not to say they take corruption lightly, however. While bribery and corruption were once regarded as rather trivial offenses in Germany, today 90 percent of employees are convinced such crimes will be seriously investigated by public prosecutors.
"It's not to be overlooked that a great deal has taken place in Germany," Heissner wrote.
Ernst & Young's study ranked Sweden and Switzerland as the two most legally-aware nations in Europe respectively. Germany and Norway shared third place, ahead of Great Britain. Russia, the Czech Republic, Croatia, Ukraine and Ireland were at the bottom of the list.
Author: Rolf Wenkel (gps)
Editor: Sam Edmonds