Industry News
SupplierBusiness.com ethics survey: corruption is a serious issue in automotive sector
10th October 2006
Yesterday’s (7th) issue of the UK-based ‘SupplierBusiness Insight’ newsletter includes an ethics survey which suggests that although the industry is mostly managing its purchasing relations in an ethical manner, suppliers are unsure about what the guidelines of many of their customers really are. And a significant minority of suppliers believe that the kind of corruption that has come to light recently (e.g. with the resignation of Faurecia’s CEO Pierre Levi) is ‘fairly’ or ‘very’ typical of the industry.
Suppliers were divided about how typical such corruption is in the automotive industry. Fifty two percent of respondents said that bribery is not common, but the remainder thought that improper inducements do play a significant role. Indeed, 20% of those surveyed thought that bribery was either typical or very typical. Our respondents thought that the challenge was one for the whole industry. Despite the marked variation in opinion concerning the extent of bribery, there was a consensus (76%) that this issue should be addressed by both suppliers and carmakers.
So far, four carmakers and six suppliers have been questioned in the current investigations conducted by German authorities into allegations of corruption and bribery. The first conviction was that of Günther Link, a former BMW purchasing manager, who was sentenced to three years imprisonment, having admitted taking money from suppliers for providing inside information and influencing the decision-making process on new projects.
It has also been revealed that at least thirty individuals, across four OEMs and six suppliers, have been questioned in connection with these and other charges. The four manufacturers are Volkswagen, Audi, SEAT and BMW. The six suppliers are Lear, Intier, Dräxlmaier, Grammer, M&H (Automotive Interior World, as of December 05) and Faurecia. During the investigation, prosecutors questioned two other former BMW managers, together with more than 20 current and former supplier employees and their representatives. Up to nine people have been taken into custody and released. The allegations are currently centred on two separate cases of bribery and corruption in Frankfurt and Munich.
(www.supplierbusiness.com, 9 October)
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