Corporate culture and managers fraud tendency perception: testing of fraud hexagon theory

This study aims to examine the fraud tendency in the perception of managers triggered by six components of the fraud hexagon: pressure (P), capability (C), collusion (Co), opportunity (O), rationalization (R), and ego (E). In addition, corporate culture (CC) is placed as a moderating variable in this relationship to test how much it can weaken it. This is a quantitative study with a survey of managers at Indonesian multinational companies. A total of 130 respondents participated in this study. A moderation model for a research framework was developed to investigate the moderating role of corporate culture. The findings have shown that the six components of the fraud hexagon theory are not fully proven as triggers of fraud. P, O, and R have a significant value in influencing the perception of fraud tendency (PFT). Other findings also provide evidence that CC moderates the relationship between P, O, and R and PFT. This shows that CC can be used as an anti-fraud strategy in managers’ workplaces. The originality of this paper is that it is one of the first studies that examines the fraud hexagon theory in behavioral accounting. In addition, this paper contributes to the integration of corporate cultures as an anti-fraud strategy in managers’ workplaces.