Transparency International calls on the United Nations to make governance a global commitment post 2015
- Transparency International has published its recommendations to the United Nations to adopt a goal on governance as part of new global commitments to succeed the Millennium Development Goals (MDGs).
The Global Corruption Report 2004 provides an overview of the state of corruption around the world. It covers national and international developments, institutional and legal change and activities within both the private sector and civil society for the period from July 2002 to June 2003. This year the Global Corruption Report focuses on political corruption. It presents 34 country reports and the latest research on corruption.
Political corruption is the abuse of entrusted power by political leaders for private gain. The scale of the problem can be vast. One of the world’s most corrupt leaders, Mohamed Suharto of Indonesia, allegedly embezzled up to US $35 billion in a country with a GDP of less than US $700 per capita.
Corruption in political finance takes many forms, ranging from vote buying and the use of illicit funds to the sale of appointments and the abuse of state resources. Not all are illegal. Legal donations to political parties often result in policy changes, for example. A 2003 World Economic Forum survey finds that in 89 per cent of the 102 countries surveyed the direct influence of legal political donations on specific policy outcomes is moderate or high.
Anti-corruption reporting: the first line of defence for companies
The European Commission recently announced a proposal that would require 18,000 European companies to be more transparent about their efforts to combat corruption and bribery by publishing details of how they go about this. This is good news. Anti-corruption programmes constitute a company’s first line of defence against corruption.
Full and transparent disclosure of anti-corruption programmes underscores a company’s commitment to countering corruption and enhances ethical conduct among management, employees, partners, agents and other relevant parties up and down the value chain.
Transparency International has long advocated for greater transparency in corporate reporting as part of a company’s dedication to fighting corruption. That’s why we have developed a way to measure how well companies are positioned to carry on that fight. We have identified three areas where companies can demonstrate the strength of their position to combat corruption. The first is reporting on their anti-corruption programmes. The other two are reporting on their organisational structure and their key financial data on a country-by-country basis.
Transparency in Corporate Reporting
In 2009, when Transparency International published its first report on the anti-corruption programme reporting practices of 500 major multinationals, they scored an average of 47 per cent.
In the July 2012 report Transparency in Corporate Reporting: Assessing the World’s Largest Companies, the score for the anti-corruption dimension had risen to 68 per cent – a marked improvement over the 2009 numbers. That study analysed the publicly available information from the company websites of the world’s 105 largest publicly traded multinationals.
While some multinational companies now report on certain aspects of their anti-corruption programmes, there is still significant room for improvement. For example, few indicate that facilitation payments are prohibited and reporting on monitoring procedures tends to be weak. The study found that three of the companies published all the prescribed information while three published none.
We encourage all businesses, both large and small, both listed and unlisted, to have comprehensive anti-corruption programmes in place and to make them publicly available. By adopting greater corporate transparency, companies provide the necessary information for investors, journalists, citizens and civil society to monitor their behaviour and hold them accountable.
Transparency International published in 2009 its Business Principles for Countering Bribery, which provided a blueprint for establishing anti-corruption systems. These principles, which form the basis for other similar codes and guidelines, show companies what the key components of a robust anti-corruption programme should be. The Business Principles are the product of a multi-stakeholder effort, including input from the business community.
Formalised and consistent reporting on anti-corruption activities, integrated into already established reporting processes (e.g., accounting), ensures reliable and measurable internal operations. It shows employees that the fight against corruption is taken very seriously (“What gets measured gets done”). This results in the following benefits:
- strengthening anti-corruption behaviour, including better risk management and compliance
- encouraging and supporting employees in resisting corruption
- providing management with a foundation for analysis of progress
- planning and continuous improvement
- motivating employees to be proud of their organisation.
Transparency International has updated the Business Principles and is currently seeking comments on the revised draft. The deadline for contributions is 27 May this year.
Press contact(s):Chris Sanders
Manager, Media and Public Relations
+49 30 3438 20 666
Global Corruption Report 2004: Political Corruption
The 2004 edition of the Global Corruption Report focuses on corruption in the political process and on the insidious impact of corrupt politics on public life in societies across the globe. It includes a special section on political corruption with expert reports on the regulation of political finance worldwide, the practice of vote buying, barriers to transparency in the arms and oil sectors as well as efforts to repatriate wealth looted by politicians.
Download the report | View online | Translations: ESFRRU