Illicit and Corruption Mitigation Strategy in the Financial Sector: A Study with a Hybrid Methodological Approach

Eleni Zafeiriou, Alexandros Garefalakis, Ioannis Passas and Konstantina Ragazou ()
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Eleni Zafeiriou: Department of Agricultural Development, Democritus University of Thrace, GR50100 Orestiada, Greece
Alexandros Garefalakis: Department of Business Administration and Tourism, Hellenic Mediterranean University, GR71410 Heraklion, Greece
Ioannis Passas: Department of Business Administration and Tourism, Hellenic Mediterranean University, GR71410 Heraklion, Greece
Konstantina Ragazou: Department of Business Administration, Neapolis University Pafos, Pafos 8042, Cyprus

Sustainability, 2023, vol. 15, issue 2, 1-16

Abstract: In recent decades, experts from all around the world have been increasingly interested in illegal conduct and corruption in financial organizations. Utilizing the illegal and corruption hypothesis, we investigate the core traits and trends of this phenomenon in European financial institutions. We also examined how specific aspects are incorporated into financial firms’ anti-corruption strategies. The current study makes an effort to comprehend the afore-mentioned challenges using the tools of scientometrics and data analysis. More precisely, our empirical analysis was based on 336 European financial institutions for the years of 2018–2020, and our study also employed bibliographic data from 687 scientific documents indexed in the Scopus database in 2010–2021. The R language’s Bibliometrix tool was applied to analyze the body of the existing literature. A binary logistic regression approach was used to analyze the data. While the goal of our empirical study is to unveil the factors causing or mitigating illegal activity and corruption in the financial sector, the bibliographic analysis revealed the determinants validated in previous work. Our results highlight the need of policy makers to implement measures to limit illegal activity and reduce corruption in financial institutions to improve reputations and customers’ fidelity, which are necessary for the achievement of the sustainable development goals concerning financial institutions. Another conclusion is the emergence of a new source of corruption, which South Africa’s experience has confirmed. Our findings also support two components of the contemporary approach for reducing corruption and illicit activity, namely, the usage of new technology specialists and the incorporation of ESG factors.

Keywords: anti-corruption strategy; efficiency; emerging technologies; Europe; finance; illicit; sustainability; tax (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
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