Corruption Hurting Businesses - KPMG

AllAfrica |

CORRUPTION in the private and public sector has increased due to the lack of a proper anti bribery and corruption framework in the local companies, according to a survey by audit firm KPMG.

In a survey titled 'Business Against Corruption: A case study of anti-bribery and corruption practices among Kenyan companies', it said corruption has increased the cost of investing in Kenya since the structures for handling ethics and integrity in companies are in the early stages of formation.

The firm said the companies which were surveyed include Safaricom, East African Breweries Limited, Kapa Oils and AAR adding that the sample cited bribery and corruption as a vital aspect of risk management.

"Companies are still developing mechanisms to combat bribery and corruption risks. They carry out investigations on corrupt behavior within the company or call for external investigative services from independent consultants," KPMG noted.

The study was commissioned by the Kenya Association of Manufacturers. KAM chief executive officer Betty Maina said companies should understand that risks associated with corruption can undermine business objectives. She said companies should evaluate the design and operational effectiveness of anti-bribery and corruption compliance programs.

"The company boards should attain high levels of ethics through sound corporate governance, internal control and transparency," she said during the launch of the report in Nairobi yesterday.

Maina said the anti bribery and corruption framework demands for an effective corporate governance structure, risk assessment and proportionate polices and procedures, saying, "the commercial organization should: train the staff on corruption prevention policies, communicate to clients on due diligence procedures, monitor and review persons, and act swiftly to correct the harm caused by corruption."

"There is need for concerted effort by all sectors to fight corruption. Public and private sector collaboration is needed to seal the loopholes that arise as a result of interaction of the two sectors," she said.

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