Transparency International Registers Alarming Rate of Bribery Propensity among Companies in 2011

World | November 2, 2011, Wednesday // 14:39|  views

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Inter-company corruption is as popular as the practice of offering bribes to civil servants, according to Transparency International's 2011 Bribe Payers Index (BPI).

These findings indicate that corruption is not only a problem of the public sector but also of private companies because it exposes them to financial and reputational risks, the authors of the survey warn, as cited by Capital Daily.

The Index released by the global NGO late on Tuesday ranks the likelihood of companies from 28 leading export countries and territories to bribe abroad and measures the perceived propensity of firms from 19 business sectors to engage in corrupt practices.

It scores and ranks countries on a scale of 0 to 10, where a maximum score of 10 corresponds with a view that companies from that country never engage in bribery when doing business abroad.

The Netherlands and Switzerland top TI's 2011 ranking with scores of 8.8, with Belgium, Germany and Japan following closely behind.

Companies from Russia and China, which invested US 0 billion overseas in 2010 and are increasingly active in global business, are seen as most likely to pay bribes abroad.

Leaders of international companies confess that they keep offering bribes to public officials to win public procurement contracts, sidestep regulatory regimes, fast-track managerial processes or secure influence over decision making.

This year's survey is the first which takes stock of inter-company corruption, establishing the same degree of willingness of company owners to pay bribes to peers abroad to facilitate business.

The 2011 edition of the ranking is based on the views of over 3000 business executives worldwide on the extent to which companies from 28 of the world's leading economies engage in bribery when doing business abroad.

The score for each country reflects the views of the business people who had come into contact with companies from that country.

Of the 28 countries included in the 2011 Bribe Payers Index, 22 were also ranked in the previous edition, published in 2008.

The six new entries for 2011 are Argentina, Indonesia, Malaysia, Saudi Arabia, Turkey and the United Arab Emirates, all of them occupying slots in the bottom half of the table.

Bulgaria is not part of the ranking.

According to the index for 2011, India's score posts the biggest improvement with an increase of 0.7, although the country remains near the bottom of the list, while Canada and the United Kingdom register the steepest deterioration in their scores with a drop of -0.3, which drags them five and three places down, respectively.

Of the 19 business sectors studied, TI ranks public works contracts and construction as the most bribery-prone sectors, while agriculture and light manufacturing are seen as the sectors with the lowest potential for corruption.

Other sectors characterized by significant opportunities and incentives for corruption include utilities; real estate, property, legal and business services; oil and gas; and mining.

In its concluding observations, TI urges both governments and companies to take steps to ensure effective implementation of anti-bribery policies and procedures.

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Tags: Transparency International, corruption, bribe, governments, construction, public works, public procurement


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