New Delhi: A large number of companies exaggerate profits and indulge in corrupt practices to achieve higher growth, says a survey by global accountancy firm EY.
According to the EY EMEIA Fraud Survey, 80 percent of Indian respondents believe that bribery and corrupt practices happen widely in relation to business.
EY, formerly known as Ernst & Young, found that manipulation of financial results is prevalent as 40 percent of the respondents believe companies in their market often exaggerate financial performance.
"59 percent opine that companies often report their financial performance as better than it is," the survey said.
"Businesses are operating in an exceptionally challenging environment," it said, adding management is under increased pressure to find new ways to grow their business.
EY Partner (Fraud Investigation & Dispute Services) Arpinder Singh said: "The survey does indicate that there is enhanced awareness about ethical business practices and that acceptance seems to be setting in, though it may take time."
Around 67 percent of respondents felt that India has been achieving economic growth which is slower than expected and economic sanctions are more complex and require greater effort for businesses to comply, it said.
Nearly 81 percent said that managers are under increased pressure to identify new revenue opportunities, and 66 percent believe that the pressure to venture into higher risk markets is high.
It further said that 59 percent of the respondents deem offering personal gifts, cash payments or entertainment as acceptable.
Singh said the overall sentiment which the survey brings about, borders on the reluctance to change old ways, traditionally thought of as acceptable ways of doing business.
"We have been witnessing a spurt of change being driven by regulators and this has undoubtedly made a positive impact on the Indian business environment," he said.
The survey was conducted in Europe, Middle East, India and Africa.
