Corruption: Transparency Indicts Emerging Economic Giants
* Says Construction, Real Estate, Oil and Gas Sectors Most Prone To Graft
COMPANIES based in emerging economic giants, such as China, India and Russia, are perceived to routinely engage in
bribery when doing business abroad, according to Transparency International ’s 2008 Bribe Payers Index (BPI), that was
released yesterday and made available on-line to our correspondent.
Belgiumand Canada shared first place in the 2008 BPI with a score of 8.8 out of a very clean 10, indicating that Belgian
and Canadian firms are seen as least likely to bribe abroad. The Netherlands and Switzerland shared third place on the
index, each with a score of 8.7. At the other end of the spectrum, Russia ranked last with a score of 59, just below
China (6.5), Mexico (6.6) and India (6.8).
The BPI also shows public works and construction companies to be the most corruption-prone when dealing with the public
sector, and most likely to exert undue influence on the policies, decisions and practices of governments.
“The BPI provides evidence that a number of companies from major exporting countries still use bribery to win business
abroad, despite awareness of its damaging impact on corporate reputations and ordinary communities,” said Transparency
International Chair, Huguette Labelle .
“The inequity and injustice that corruption causes makes it vital for governments to redouble their efforts to enforce
existing laws and regulations on foreign bribery and for companies to adopt effective anti-bribery programmes. In this
spirit, all major exporting countries should commit to the provisions of the OECD Anti-Bribery Convention.”
TI’s 2008 BPI ranks 22 leading international and regional exporting countries by the tendency of their firms to bribe
abroad. The combined global exports of goods and services and outflows of foreign direct investment of these 22
countries represented 75 percent of the world total in 2006. The 2008 BPI is based on the responses of 2,742 senior
business executives from companies in 26 developed and developing countries, chosen by the volume of their imports and
inflows of foreign direct investment.
The Bribe Payers Survey, which serves as the basis for the BPI, also looks at the likelihood of firms in 19 specific
sectors to engage in bribery. In the first of two new sectoral rankings, companies in public works contracts and
construction; real estate and property development; oil and gas; heavy manufacturing; and mining were seen to bribe
officials most frequently. The cleanest sectors, in terms of bribery of public officials, were identified as information
technology, fisheries, and banking and finance
A second sectoral ranking evaluates the likelihood of companies from the 19 sectors to engage in state capture, whereby
parties attempt to wield undue influence on government rules, regulations and decision-making through private payments
to public officials.
Public works contracts and construction; oil and gas; mining; and real estate and property development were seen as the
sectors whose companies were most likely to use legal or illegal payments to influence the state. The banking and
finance sector is seen to perform considerably worse in terms of state capture than in willingness to bribe public
officials, meaning that its companies may exert considerable undue influence on regulators, a significant finding in
light of the ongoing global financial crisis.
The sectors where companies are seen as least likely to exert undue pressure on the public policy process are
agriculture, fisheries and light manufacturing.
While most of the world’s wealthiest countries already subscribe to a ban on foreign bribery, under the OECD
Anti-Bribery Convention, there is little awareness of the convention among the senior business executives interviewed in
the Bribe Payers Survey. Governments have a key role to play in ensuring that foreign bribery is stopped at the source –
and by making good on commitments to prevent and prosecute such practices.
“The unfolding financial crisis has shown us just how integrated the world’s markets have become. Accountability must be
guaranteed across borders, include improved risk management and reach all the way down a company’s supply chain,” said
Cobus de Swardt , TI Managing Director. “Businesses face a complex challenge, but efforts to improve labour practices,
for instance, by working with intermediaries, suppliers and affiliates, show that there is no excuse to not extend
anti-bribery standards globally in a similar fashion.”