Australia needs tougher laws to tackle foreign bribery and company directors should be held responsible for serious corporate crime, a federal inquiry has heard.

On Monday the Senate economics references committee, which is holding an inquiry into foreign bribery, heard that Australia's enforcement efforts were failing, with just two corporate convictions achieved since 1999 when foreign bribery laws were enacted.

Labor senator Chris Ketter said he was concerned by evidence that Australia was seen as a "soft touch" when it came foreign bribery.

"Almost all witnesses acknowledged that Australia lags behind the US and UK when it comes to preventing foreign bribery," he said.