Actually, that’s not what EY said. I wonder if the person writing the following actually read the report (excerpt):
Malaysia has been ranked as one of the most corrupt nations and listed as a country which is most likely to take shortcuts to meet targets when economic times are tough, according to a recent survey by Ernst & Young, signalling that the government's Performance Management and Delivery Unit (Pemandu) has failed in its role to transform the economy.
Malaysia, along with China, has the highest levels of bribery and corruption anywhere in the world, according to the latest report, Asia-Pacific Fraud Survey Report Series 2013.
This year's survey polled 681 executives in China, Singapore, Australia, New Zealand, Indonesia, Vietnam, Malaysia and South Korea.
About half of the 681 executives polled on their perception of fraud felt that China, Indonesia, Malaysia and Vietnam were the worst in bribery and corruption…
…About 39% of respondents said that bribery or corrupt practices happened widely in Malaysia, a figure which is nearly double the Asia-Pacific average of 21%.
In addition, 29% of respondents said that bribery or corrupt practices here have increased due to tough economic times and increased competition, which is the third highest among the countries surveyed…
A couple of things here:
- It’s a survey of eight countries – not the world. The headline (and content) is grossly misleading.
- The survey really focuses on the internal propensity and incentive to commit fraud and bribery, not the level of corruption in the environment. While the environment is certainly an enabler, they’re not quite the same thing.
For example, the line about “most likely to take shortcuts” actually refers to a survey question on company managements, not on the country per se. So its a bit of a stretch to go from the conclusions of the report to “…one of the most corrupt nations…”, and “…(Pemandu) has failed…”
There are survey questions on corruption in the environment, which are worth actually quoting in full, because the results are pretty interesting:
- “Bribery/corrupt practices happen widely in the country where you are based”; 39% agreed, Rank: 2 (highest: Indonesia 79%)
- “In your industry, it is common practice to use bribery to win contracts”; 15% agreed, Rank: 3 (highest: Indonesia 36%)
- “Bribery/corrupt practices have increased because of tough economic times and increased competition”; 29% agreed, Rank: 3 (highest: Vietnam 39%)
- “Government efforts against bribery have had a substantial impact on the level of bribery in the country you are based”; 56% agreed, Rank: 1
I found the dichotomy between the answers to Q1 and Q2 really interesting. What, who me? And then there’s Q4…
Nevertheless, the fact of corruption is undeniable, but then that’s not something we don’t know. On the other hand, the level of corruption here isn’t as bad as some have portrayed – Transparency International’s Corruption Perception Index 2012 report for instance ranks Malaysia 54th out of 176th countries, i.e. in the top third least corrupt. We’re nowhere near ANZAC or Singapore levels, but then, we’re not exactly Zimbabwe (163), Venezuela (165), or Somalia (174) either.
Finally, government efforts against corruption appear to have had an effect, based on response to that last survey question. EY had some survey questions on internal compliance policies, in which Malaysia scores quite well.
You can download a copy of the report from the EY website. And while we’re on the subject of corporate ethics, we might really need a survey on journalistic ethics (and that goes for mainstream media too).