RiskOperational RiskFinance and Retail Sectors Most Scrutinised on Ethics

Finance and Retail Sectors Most Scrutinised on Ethics

The finance sector again attracted most media attention for ethical issues – and lapses – last year, but there were more ethics-related stores on the technology, travel/tourism and utilities sectors in 2014 than previously, the Institute of Business Ethics (IBE) reports.

The IBE found that the finance sector accounted for 38% of stories about ethical concerns and lapses last year, a total of 181 and a figure consistent with previous years. With 60 reported ethical lapses and concerns, retail was the second most covered industry.

Price-fixing was the most commonly reported issue for the finance sector in 2014, with 28 separate stories relating to controversies such as London Interbank Offered Rate (Libor) rigging as well as alleged rigging of other benchmarks. Allegations of mis-selling of financial products and services closely followed, with 18 stories reported.

Of the 60 stories relating to the retail sector, eight concerned alleged mistreatment of employees, seven to supply chain issues, while marketing/advertising practices and misleading information each provided six.

A total of 27 stories published last year on ethical lapses and concerns related to the technology sector, which made it the third most reported sector against fifth in 2012-13. Stories relating to data protection and privacy accounted for nearly one in three.

“Security of information, especially information collected online, is becoming an increasingly prominent issue for organisations,” the IBE noted.

Other findings from the 2014 survey included fewer stories relating to bribery and corruption, which was the most reported on business ethics issue in 2012-13. Reporting on ethical issues in the supply chain also showed a reduction – 16 incidents were reported, making it the 13th most reported issue last year against 52 incidents and sixth position in the previous survey.

Figure 1: Allegations of Misconduct by Sector

IBE ethics stories 2014 fig1

Source: IBE

Figure 2: Business Ethics Issues

IBE ethics stories 2014 fig2

Source: IBE

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