1. With the global chemical industry expected to grow to over $5.5 trillion in revenue by the end
of 2020 driven by expansion in international markets,1
managing fraud risk and compliance
exposure is a critical business priority. Law enforcement agencies, including the United States
Department of Justice (DOJ) and the United States Securities and Exchange Commission
(SEC), are increasingly focused on individual misconduct and have heightened the pressure
on companies to mitigate fraud, bribery and corruption. In this context, executives need to be
confident that their businesses comply with rapidly changing laws and regulations wherever
they operate. While many businesses have made progress in tackling these issues, there
remains a persistent level of unethical conduct.
EY’s Global Fraud Survey 2016 represents the views of nearly 3,000 decision makers in 62
countries and territories, and provides compelling insight into perceptions of fraud, bribery
and corruption across the globe. The following summarizes the insights of the 363 survey
respondents from the chemical industry.
EY’s Global Fraud Survey
2016
Chemical industry results
Download our Global Fraud Survey 2016 report: ey.com/globalfraudsurvey2016
13%
indicated that they would be
willing to provide personal gifts in
order to win or retain business
Key findings
23%
indicated that they would be
willing to provide entertainment
to officials in order to win or retain
business
indicated that they do not include
country-specific risks in due
diligence procedures
33%
37%
indicated that they
believe bribery and
corruption practices
happen widely in the
industry
18%
indicated that they do not
include identification of third
parties such as vendors or
distributors in due diligence
procedures
27%
indicated that they do not
include an assessment of
anti-corruption policies in
due diligence procedures
31%
indicated that they believe
regulators appear willing
to prosecute cases of
bribery and corruption and
seem effective in securing
convictions
Efforts to minimize the risk of corruption
Compliance
Execute a comprehensive compliance
program that incorporates anti-bribery/
anti-corruption (ABAC) policies, travel
and entertainment procedures and
localized training
Cybercrime
Develop a cyber breach response plan
that brings all parts of the business
together in a centralized response
structure
Anti-corruption due diligence
Undertake due diligence during
M&A and of high-risk third parties
such as distributors, sales agents,
exclusive-use tollers, consultants
and custom brokers
Fraud risk assessments
Per COSO’s 2016 Fraud Risk
Management Guide, perform
comprehensive fraud risk assessments
to identify specific schemes, assess the
likelihood and significance, evaluate
fraud control activities and implement
actions to mitigate fraud risks
Whistleblowing
Establish clear whistleblowing channels
and policies (in local language)
that not only raise awareness of
reporting mechanisms, but encourage
employees to report misconduct
Finance
Adequately resource compliance
and investigations functions so that
they can proactively engage before
regulatory action
1. MarketLine, Industry Profile - Global Chemicals, June 2016.