Although four out of five companies have taken measures toaddress bribery and corruption risks, they're not making muchprogress in eliminating these dangers to their business. That's thekey takeaway from the “13thGlobal Fraud Survey” that EY released last week. The poll wasconducted from November 2013 to February 2014; it entailedinterviews by a global research firm with 2,719 seniordecision-makers in large companies across 59 countries andterritories. Respondents were primarily CFOs, chief complianceofficers (CCOs), general counsel, and heads of internal audit.

Among these respondents, 82 percent said their company has ananti-bribery and corruption (ABAC) policy and code of conduct. Evenmore (83 percent) said senior management has “stronglycommunicated” its commitment to ABAC policies. Almostthree-quarters (73 percent) said there are clear penalties forviolating their company's ABAC policies, and 35 percent said peoplehave been penalized for breaching the company's policies.

Nevertheless, 39 percent of all respondents—and 54 percent ofthose who work in emerging markets—said bribery and/or corruptpractices happen widely in business in their country. Thisperception is virtually unchanged from the 2012 EY survey, in which38 percent of all respondents, and 56 percent in emerging markets,said bribery and corruption are widespread in their country.

Ten percent of C-suite survey participants said they have beenasked to pay a bribe in a business situation, and twice that manyCEOs have faced pressure to engage in bribery. The corruptionproblem is biggest in Egypt, Kenya, and Nigeria. But 40 percent ofthe countries included in the survey were fingered by more thanhalf of their residents as having widespread corruption.

Bribery is not the only ethics challenge that companies face.Six percent of all respondents said that misstating financialperformance can be justifiable if doing so helps the businesssurvive an economic downturn. In certain locales, that proportionis much higher: 28 percent in Singapore, 24 percent in India, and10 percent in South Africa. Not only that, but 7 percent of CFOsand other finance professionals think performance misstatements canbe justified—as do 11 percent of CEOs.

Ten percent of CFOs think back-dating a contract can bejustified if it helps the company meet financial targets. Elevenpercent are OK with extending the monthly reporting period, 17percent with changing assumptions used to determine valuations orreserves, and 31 percent with increasing the flexibility ofproduct-return policies. Only half of CFOs (51 percent) don't thinkany of these actions are justifiable when the company is fallingshort of performance goals. (See Figure 1, below.)

“While boards often set a zero-tolerance tone and encouragemanagement to build teams to address the risks of bribery andcorruption, our experience tells us that ongoing oversight from theboard is essential if the risks are to be more effectivelymitigated,” EY states in the survey write-up. “Our results showthat in companies where the leadership is most engaged anddemanding, there is a higher level of compliance activity acrossthe firm. It is essential that the board sets a challenging plan,continues to ask tough questions, and actively holds seniormanagement accountable for the results.”