The current global environment is ripe with opportunities for developing countries. Bangladesh’s economic scorecard is well-aligned with this trend, as it showcases significant growth in line with other markets especially in the Asia Pacific region. The current Gross Domestic Product of the country stands at 6.8%, and has consistently been above 6% over the last three years. This progress is led by the country’s thriving ready-made garment and telecom sectors that is backed by strong private investments, substantial export figures and large remittances in infrastructure and services. In 2015, the country achieved a new milestone with foreign direct investment surpassing $2 billion; this was a 44% increase from the previous year.
However, emerging markets on the path of success have can face many roadblocks. As Bangladesh strives to capitalize on opportunities and cultivate a positive business environment, combating fraud risks has risen as a key priority for organizations operating in the region. To discuss and debate the potential of this fast growing economy and good governance practices, our Fraud Investigation & Dispute Services (FIDS) team recently organized an exclusive session on ‘Exploring and combating fraud risks in Bangladesh’. Held at Dhaka, the session covered aspects of global trends in forensic, corporate governance and integrity challenges and leading practices to overcome risks.
Mr. Aftabul Islam FCA, Member, Board of the Bangladesh Bank and Past President, American Chamber and Dhaka Chamber of Commerce & Industries shared his views about Bangladesh being an attractive destination for investments, with flexible and friendly policies for investors, great economic potential, rich natural resources and untapped human resource potential. He added that all these factors have led the nation steadily march on the path of economic growth and development.
Mr. Masud Ahmed, Comptroller & Auditor General of Bangladesh was the Chief Guest and threw light on the importance of stricter enforcement to penalize fraudsters, thereby maintaining compliance within organizations. He stressed on the fact that the Government and organizations in Bangladesh have to work in sync with each other to successfully reprimand fraudsters.
The FIDS India team has identified Bangladesh as a strategic market, having worked on a number of engagements over the last one year. Our discussions with the companies show an increased understanding to be at par with global standards, ramp up internal controls and foresee future risks. Globally, areas such as financial misconduct, insider threats, cybercrime, money laundering and product recalls have been areas of concern. Other emerging risks around workplace safety, data security, modern slavery and prevention of sexual harassment at the workplace will need to be addressed. Hiring skilled personnel with vast experience in their respective fields will help to combat fraud.
Rupali Chowdhury, President, FICCI stressed on the importance of corporate governance. She highlighted from experience on the existence of several external factors that might influence an employee to commit crime. Continuous training and awareness programs in line with the organization’s vision and values could be beneficial in communicating a strong tone at the top and conveying the repercussions of non-compliance to them early on.
A thought provoking panel discussion ensued on emerging fraud risks and leading practices that can be adopted to tackle threats in Bangladesh. Setting up robust whistle-blowing policies, strengthening internal controls, proactive fraud risk assessment, delegation of duties than a centralized approach were some key methods to tackle insider threats. In addition, Know Your Customer (KYC) and increased focus on investments in IT emerged crucial to fight risks.
Global businesses have realized that the deployment of technology can turn out to be a catalyst in curbing fraud and corruption risks. In Bangladesh too, companies will have to invest in ramping up their technological play and driving compliance. Innovations in technology, the use of dashboards and adopting IT infrastructures can be key components in organizations’ battle against corporate as well as individual misconduct.