The world’s nations aren’t doing enough to address and prevent corrupt influences from taking root, according to an international observer focused on eradicating corruption.
Transparency International’s Corruption Perceptions Index “reveals a staggering number of countries are showing little to no improvement in tackling corruption”, according to the group’s most recent report, which was released in January.
The drops in confidence were attributed by the anti-corruption coalition to growing concerns across the globe about undue influence through political campaign financing, decreasing trust in institutions, and public dissatisfaction with existing anti-corruption efforts.
Transparency International, which has been tracking public sentiments around global corruption since 1995, called on government leaders to limit the influence of money in politics and seeking broader input to decision-making.
The group gauges sentiments around corruption in 180 of the world’s 195 nations, by seeking out perceptions from trusted groups of observers in each nation. The rankings come on a scale of 1 to 100, with lower scores given to countries largely seen as allowing or fostering corrupt forces while nations with scores on the high end work to discourage and address money laundering, bribery, and political corruption.
More than two-thirds of the countries ranked below 50, with the average score 43, a sign of concern for the group.
The report offers insight into the locales where business may be more likely to face worrisome scenarios, such as requests for bribes from government officials.
Management accountants can use the annual analysis to gauge the level of business risk in more troubled countries and decide what additional measures could be put in place to ensure corporate reputations are kept intact.
Here are some of the highlights from this year’s report:
- At the top: Denmark, New Zealand, Finland, Singapore, Sweden, and Switzerland held the top slots for countries largely recognised for fostering public and private standards that steer away from corrupt influences.
- At the bottom: The most troubled nations were Somalia, South Sudan, Syria, Yemen, Venezuela, and Sudan, according to the index. All of these nations have been ravaged by war and societal instability in recent years (or longer).
- Trouble for the G7: This year’s report found the world’s biggest economies are not improving their anti-corruption efforts. Four G7 nations saw their scores drop in the last year: Canada, France, the UK, and the US, which also had its lowest score in the last eight years. Germany and Japan remained the same, and Italy saw its score improve by a point.
- Getting better: Twenty-two nations had their scores improve over the last eight years. Greece, Guyana, and Estonia experienced the greatest strides over the last eight years, according to the Transparency International report.
- Sliding scores: But nations like Canada, Nicaragua, and Australia were among the 21 countries experiencing a decline in this year’s corruption perceptions.
- Nordic businesses questioned: Largely perceived as “clean” countries were the Nordic nations of Denmark, Finland, Sweden, Norway, and Iceland, all of which made it in the top dozen slots. But major scandals from companies headquartered there over the last year cast shadows on those accolades, according to Transparency International. The scandals included reports of bribery and money laundering by the Icelandic fishing conglomerate Samherji; telecoms giant Ericsson paying more than $1 billion to settle a foreign bribery case with US authorities; and a money-laundering scandal from Denmark’s largest bank, Danske Bank.
To read the report in its entirety, click here.
— Sarah Ovaska is a freelance journalist based in the US. To comment on this article or to suggest an idea for another article, contact Chris Baysden, an FM magazine associate director, at Chris.Baysden@aicpa-cima.com.