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Indian firms best, China worst on transparency: Survey
Agencies | Jul 11, 2016, 12.17 PM IST
HIGHLIGHTS
HONG KONG/LONDON: India has the most transparent companies while Chinese firms are the most opaque, according to a Transparency International survey.
The survey, released by the Transparency International on Monday, covered 100 companies in 15 emerging market countries that also included Brazil, Mexico and Russia.
India led the way, with all 19 of its companies in the study achieving a score of 75 percent of more in being open about their company structures and holdings which was attributed to the country's Companies Act.
The study found Chinese companies fared worst, with an average score of 1.6 out of 10 in the tests, due to having weak or non-existent anti-corruption policies and procedures.
Thirty-seven Chinese companies were evaluated, making them the survey's biggest group, but they had the weakest overall performance. The three companies that scored zero out of 10 were all Chinese: automaker Chery, appliance maker Galanz and auto parts maker Wanxiang Group. The list's bottom 25 spots were also dominated by Chinese companies.
"The very weak Chinese results stem from weak or non-existent anti-corruption policies and procedures, or a clear failure to disclose them in line with international practice," Transparency International said in a press release accompanying its report.
Indian firms, on the other hand, dominated the top spots, in part because of strict government requirements for financial dislosures, including subsidiaries operating in different countries. Telecom company Bharti Airtel took first place with a score of 7.3 out of 10, followed by six units of conglomerate Tata and technology company Wipro.
Only one Chinese company, telecom gear maker ZTE, was placed in the top 25.
The overall score slipped since the last Transparency In Corporate Reporting survey in 2013, falling a fraction to 3.4 out of 10, with three quarters of companies scored less than half.
MNCs need to do more to fight corruption
Transparency International said the report's findings were "pathetic" and highlighted the urgent need for big multinational companies to do more to fight corruption.
The Berlin-based watchdog warned that the failure of a vast majority of companies surveyed to operate transparently risks creating an environment for corruption to thrive both in their businesses and the countries where they operate.
Emerging markets
According to the IMF, emerging markets account for over 70 percent of global growth, with concerns that corruption will hamper growth and limit socio-economic progress.
The report follows the "Panama Papers" leaks which exposed the use of shell companies and offshore tax havens, often for illegal purposes such as tax evasion and money-laundering.
This put tax avoidance and corporate secrecy at the top of the global agenda.
The Transparency International study took into account three different ways in which companies can address corruption.
These included the reporting of anti-corruption programmes such as policies to ban bribes or "facilitation payments", the disclosure of company structures and holdings, and the disclosure of key financial information in each individual country where they operate, such as tax payments.
Transparency International researchers said this information was gathered from corporate websites and other publicly available sources.
On average the companies scored 3.4 out of 10, which was a drop of 0.2 compared to the last similar survey in 2013.
Researchers said one explanation for this worse result could be the emergence of more stringent legal requirements.
But this score was also lower than a survey of 124 of the world's largest multinational companies by Transparency International in 2014 which led to an average score of 3.8.
"Across emerging markets all companies need to do much more to pursue comprehensive public reporting to address corruption and provide the transparency that is the basis for robust and accountable governance," the group said in its report.
http://timesofindia.indiatimes.com/...-transparency-Survey/articleshow/53150245.cms
Agencies | Jul 11, 2016, 12.17 PM IST
HIGHLIGHTS
- India has the most transparent companies among 15 emerging market countries.
- Chinese firms fared worst in the survey.
- 100 companies were covered in Transparency International's survey.
- 3 Chinese firms scored 0 out of 10.
HONG KONG/LONDON: India has the most transparent companies while Chinese firms are the most opaque, according to a Transparency International survey.
The survey, released by the Transparency International on Monday, covered 100 companies in 15 emerging market countries that also included Brazil, Mexico and Russia.
India led the way, with all 19 of its companies in the study achieving a score of 75 percent of more in being open about their company structures and holdings which was attributed to the country's Companies Act.
The study found Chinese companies fared worst, with an average score of 1.6 out of 10 in the tests, due to having weak or non-existent anti-corruption policies and procedures.
Thirty-seven Chinese companies were evaluated, making them the survey's biggest group, but they had the weakest overall performance. The three companies that scored zero out of 10 were all Chinese: automaker Chery, appliance maker Galanz and auto parts maker Wanxiang Group. The list's bottom 25 spots were also dominated by Chinese companies.
"The very weak Chinese results stem from weak or non-existent anti-corruption policies and procedures, or a clear failure to disclose them in line with international practice," Transparency International said in a press release accompanying its report.
Indian firms, on the other hand, dominated the top spots, in part because of strict government requirements for financial dislosures, including subsidiaries operating in different countries. Telecom company Bharti Airtel took first place with a score of 7.3 out of 10, followed by six units of conglomerate Tata and technology company Wipro.
Only one Chinese company, telecom gear maker ZTE, was placed in the top 25.
The overall score slipped since the last Transparency In Corporate Reporting survey in 2013, falling a fraction to 3.4 out of 10, with three quarters of companies scored less than half.
MNCs need to do more to fight corruption
Transparency International said the report's findings were "pathetic" and highlighted the urgent need for big multinational companies to do more to fight corruption.
The Berlin-based watchdog warned that the failure of a vast majority of companies surveyed to operate transparently risks creating an environment for corruption to thrive both in their businesses and the countries where they operate.
Emerging markets
According to the IMF, emerging markets account for over 70 percent of global growth, with concerns that corruption will hamper growth and limit socio-economic progress.
The report follows the "Panama Papers" leaks which exposed the use of shell companies and offshore tax havens, often for illegal purposes such as tax evasion and money-laundering.
This put tax avoidance and corporate secrecy at the top of the global agenda.
The Transparency International study took into account three different ways in which companies can address corruption.
These included the reporting of anti-corruption programmes such as policies to ban bribes or "facilitation payments", the disclosure of company structures and holdings, and the disclosure of key financial information in each individual country where they operate, such as tax payments.
Transparency International researchers said this information was gathered from corporate websites and other publicly available sources.
On average the companies scored 3.4 out of 10, which was a drop of 0.2 compared to the last similar survey in 2013.
Researchers said one explanation for this worse result could be the emergence of more stringent legal requirements.
But this score was also lower than a survey of 124 of the world's largest multinational companies by Transparency International in 2014 which led to an average score of 3.8.
"Across emerging markets all companies need to do much more to pursue comprehensive public reporting to address corruption and provide the transparency that is the basis for robust and accountable governance," the group said in its report.
http://timesofindia.indiatimes.com/...-transparency-Survey/articleshow/53150245.cms
