Transparency International

http://www.transparency.org


Surveys/ Indices

http://www.transparency.org/policy_research/surveys_indices/about

Transparency International (TI) seeks to provide reliable quantitative diagnostic tools regarding levels of transparency and corruption, both at global and local levels.

The annual TI Corruption Perceptions Index (CPI), first released in 1995, is the best known of TI’s tools. It has been widely credited for putting TI and the issue of corruption on the international policy agenda. The CPI ranks more than 150 countries in terms of perceived levels of corruption, as determined by expert assessments and opinion surveys.

In recent years, TI has sought to develop other corruption measurement tools to complement the CPI. The Bribe Payers’ Index (BPI) assesses the supply side of corruption and ranks corruption by source country and industry sector. The Global Corruption Barometer (GCB) is a public opinion survey that assesses the general public’s perception and experience of corruption in more than 60 countries around the world.

Transparency International is funded by various governmental agencies, international foundations and corporations, whose financial support makes the CPI possible. Additional support for TI’s measurement tools comes from Ernst & Young. TI does not endorse a company’s policies by accepting its financial support, and does not involve any of its supporters in the management of its projects. For more on Transparency International’s sources of funding, please see www.transparency.org/support_us.

Corruption Perceptions Index (CPI)


http://www.transparency.org/policy_research/surveys_indices/cpi


The annual Corruption Perceptions Index (CPI), first released in 1995, is the best known of TI’s tools. It has been widely credited with putting TI and the issue of corruption on the international policy agenda. The CPI ranks 180 countries by their perceived levels of corruption, as determined by expert assessments and opinion surveys.


http://www.transparency.org/content/download/23972/358236

Persistent corruption in low-income
countries requires global action
Concerted efforts needed in rich and poor countries to stem flow of
corrupt monies and make justice work for the poorest

London/Berlin, 26 September 2007 -- The divide in perceived levels of corruption in rich and
poor countries remains as sharp as ever, according to the 2007 Corruption Perceptions Index
(CPI), released today by Transparency International, the global coalition against corruption.
Developed and developing countries must share responsibility for reducing corruption, in
tackling both the supply and demand sides.

“Despite some gains, corruption remains an enormous drain on resources sorely needed for
education, health and infrastructure,” said Huguette Labelle, Chair of Transparency
International. “Low scoring countries need to take these results seriously and act now to
strengthen accountability in public institutions. But action from top scoring countries is just as
important, particularly in cracking down on corrupt activity in the private sector.”

The 2007 results

The 2007 Corruption Perceptions Index looks at perceptions of public sector corruption in 180
countries and territories - the greatest country coverage of any CPI to date – and is a
composite index that draws on 14 expert opinion surveys. It scores countries on a scale from
zero to ten, with zero indicating high levels of perceived corruption and ten indicating low
levels of perceived corruption.

A strong correlation between corruption and poverty continues to be evident. Forty percent of
those scoring below three, indicating that corruption is perceived as rampant, are classified by
the World Bank as low income countries. Somalia and Myanmar share the lowest score of
1.4, while Denmark has edged up to share the top score of 9.4 with perennial high-flyers
Finland and New Zealand.

Scores are significantly higher in several African countries in the 2007 CPI. These include
Namibia, Seychelles, South Africa and Swaziland. These results reflect the positive progress
of anti-corruption efforts in Africa and show that genuine political will and reform can lower
perceived levels of corruption.

Other countries with a significant improvement include Costa Rica, Croatia, Cuba, Czech
Republic, Dominica, Italy, FYR Macedonia, Romania and Suriname. Countries with a
significant worsening in perceived levels of corruption in 2007 include Austria, Bahrain,
Belize, Bhutan, Jordan, Laos, Macao, Malta, Mauritius, Oman, Papua New Guinea and
Thailand.

The concentration of gainers in South East and Eastern Europe testifies to the galvanising
effect of the European Union accession process on the fight against corruption.
At the same time, deeply troubled states such as Afghanistan, Iraq, Myanmar, Somalia, and
Sudan remain at the very bottom of the index. “Countries torn apart by conflict pay a huge toll
in their capacity to govern. With public institutions crippled or non-existent, mercenary
individuals help themselves to public resources and corruption thrives,” said Labelle.

Good governance begins at home

The poorest countries suffer most under the yoke of corruption. And it is ultimately their
responsibility to tackle the problem. Low scores in the CPI indicate that public institutions are
heavily compromised. The first order of business is to improve transparency in financial
management, from revenue collection to expenditure, as well as strengthening oversight and
putting an end to the impunity of corrupt officials.

An independent and professional judicial system is critical to ending impunity and enforcing
the impartial rule of law, to promoting public, donor and investor confidence. If courts cannot
be relied upon to pursue corrupt officials or to assist in tracing and returning illicit wealth,
progress against corruption is unlikely.

“Partnering with civil society and citizens is another essential strategy for developing countries
seeking to strengthen the accountability of government. Civil society organisations play a vital
watchdog role, can help stimulate demand for reform and also bring in expertise on technical
issues,” said Cobus de Swardt, Managing Director of Transparency International. “But,
increasingly, many governments are moving to restrict the operating space of civil society.”
In addition, many countries are unable to shoulder the burden of reform alone. In countries
where public sector institutions were historically based on patronage and nepotism rather
than merit, reform takes time and can require a substantial investment of resources, as well
as technical assistance. As significant development assistance donors, top scoring countries
play a special role in supporting greater accountability and institutional integrity in countries
plagued by the highest levels of public sector corruption. Technical assistance is a key
requirement of the landmark United Nations Convention against Corruption (UNCAC).

Corruption is a problem with global roots

The top scores of wealthy countries and territories, largely in Europe, East Asia and North
America, reflect their relatively clean public sectors, enabled by political stability, wellestablished
conflict of interest and freedom of information regulations and a civil society free
to exercise oversight.

But corruption by high-level public officials in poor countries has an international dimension
that implicates the CPI’s top scorers. Bribe money often stems from multinationals based in
the world’s richest countries. It can no longer be acceptable for these companies to regard
bribery in export markets as a legitimate business strategy.

In addition, global financial centres play a pivotal role in allowing corrupt officials to move,
hide and invest their illicitly gained wealth. Offshore financing, for example, played a crucial
role in the looting of millions from developing countries such as Nigeria and the Philippines,
facilitating the misdeeds of corrupt leaders and impoverishing those they governed.
Akere Muna, Vice Chair of Transparency International, pointed to the recovery of stolen
assets as another area ripe for enhanced action by developed nations, noting, “Criticism by
rich countries of corruption in poor ones has little credibility while their financial institutions sit
on wealth stolen from the world’s poorest people.”

In many cases, asset tracing and recovery are hindered by the laundering of funds through
offshore banks in jurisdictions where banking secrecy remains the norm. Through the
UNCAC, priority should be given to improving international cooperation and mutual legal
assistance, expediting action to recover assets, and developing legal and technical expertise
in nations requesting the return of looted assets.

For many countries, repatriation of funds will mean long and extensive litigation. “In addition
to ensuring adequate legal funding, simplifying recovery procedures and provisions for third
party institutions to act as escrows during litigation must be a high priority,” Muna added.

Act now: urgent steps

As a problem of global scale, with global roots, fighting corruption demands action on a broad
front.

· Developing countries should use aid money to strengthen their governance
institutions, guided by national assessments and development strategies, and to
incorporate strengthened integrity and corruption prevention as an integral part of
poverty reduction programmes.

· Judicial independence, integrity and accountability must be enhanced to improve the
credibility of justice systems in poorer countries. Not only must judicial proceedings
be freed of political influence, judges themselves must subject to disciplinary rules,
limited immunity and a code of judicial conduct to help ensure that justice is served. A
clean and capable judiciary is essential if developing countries are to manage
requests for assistance in the recovery of stolen assets from abroad.

· Governments must introduce anti-money laundering measures to eradicate safe
havens for stolen assets, as prescribed by the UNCAC. Leading banking centres
should explore the development of uniform expedited procedures for the
identification, freezing and repatriation of the proceeds of corruption. Clear escrow
provisions for disputed funds are essential.

· Wealthy countries must regulate their financial centres more strictly. Focusing on the
roles of trusts, demanding knowledge of beneficial ownership and strengthening antimoney
laundering provisions are just a few of the ways that rich governments can
tackle the facilitators of corruption.

· The world’s wealthiest governments must strictly enforce the OECD Anti-Bribery
Convention, which criminalises the bribery of foreign public officials. Lack of
compliance with the convention’s provisions continues to hinder corruption
investigations and prosecutions.

· The boards of multinational companies must not only introduce but implement
effective anti-bribery codes, and ensure that they are adhered to by subsidiaries and
foreign offices.

###

Transparency International is the global civil society organisation leading the fight against corruption.
Note to editors:
The CPI is carried out for Transparency International by Prof. Johann Graf Lambsdorff of the
University of Passau in Germany.
Transparency International’s Global Corruption Report 2007, with a special focus on
corruption in judicial systems, was published in May 2007 and is available at
http://www.transparency.org/publications/gcr.


2007 Transparency International Corruption Perceptions Index

A country or territory’s CPI Score indicates the degree of public sector corruption as
perceived by business people and country analysts, and ranges between 10 (highly
clean) and 0 (highly corrupt)

USA rank:  20
USA CPI Score 2007:  7.2


What is the Corruption Perceptions Index (CPI)?
The Transparency International Corruption Perceptions Index ranks countries in
terms of the degree to which corruption is perceived to exist among public officials
and politicians. It is a composite index, a poll of polls, drawing on corruption-related
data from expert and business surveys carried out by a variety of independent and
reputable institutions. The CPI reflects views from around the world, including those
of experts who are living in the countries evaluated. Transparency International
commissions the CPI from Johann Graf Lambsdorff, a university professor based in
Passau, Germany.

For the purpose of the CPI, how is corruption defined?
The TI CPI focuses on corruption in the public sector and defines corruption as the
abuse of public office for private gain. The surveys used in compiling the CPI ask
questions that relate to the misuse of public power for private benefit, for example
bribery of public officials, kickbacks in public procurement, embezzlement of public
funds or questions that probe the strength of anti-corruption policies, thereby
encompassing both administrative and political corruption.

How should the CPI scores be interpreted?
The CPI should be interpreted as a ranking of countries with scores ranging from 0
(highly corrupt) to 10 (highly clean).

Which matters more, a country’s rank or its score?
While ranking countries enables TI to build an index, a country’s score is a much
more important indication of the perceived level of corruption in a country. A country's
rank can change simply because new countries enter the index or others drop out.

Global Corruption Barometer (GCB)


http://www.transparency.org/policy_research/surveys_indices/gcb

The Global Corruption Barometer is a survey that assesses general public attitudes toward and experience of corruption in dozens of countries around the world. 


http://www.transparency.org/policy_research/surveys_indices/gcb/2007


http://www.transparency.org/news_room/latest_news/press_releases/2007/2007_12_06_gcb_2007_en

Poor families are hit hardest by demands for bribes in developed as well as developing countries, according to Transparency international’s Global Corruption Barometer 2007. The public opinion survey, published today ahead of International Anti-Corruption Day on 9 December, also found that citizens in countries across the globe continue to see political parties and parliaments as the institutions most compromised by corruption.

The Barometer, which surveys 63,199 respondents in 60 countries, offers a broad spectrum of data on common experiences of corruption, including which institutions most frequently demand bribes, where citizens see the greatest degree of corruption, and how they see both the future development of corruption and their governments' efforts to eradicate it.

“This year’s Global Corruption Barometer has made it clear that too often, people must part with their hard-earned money to pay for services that should be free”, said Transparency International Chair Huguette Labelle. “And they do not see enough commitment when they look to their governments and leaders. We are heartened though, that the public is increasingly demanding the accountability of the very institutions that most affect their lives, as this is a powerful driver of change.”

Bribery: A tax on poor families everywhere

The TI Global Corruption Barometer 2007 finds that it is the poor who are most often confronted with requests for bribes, in wealthy and poor countries alike. Extortion hits low-income households with a regressive tax that saps scarce household resources.

More than one in ten respondents reported having to pay a bribe in the past year for access to a service. The countries with the highest level of petty bribery are Albania, Cambodia, Cameroon, FYR Macedonia, Kosovo, Nigeria, Pakistan, Philippines, Romania and Senegal, where at least 30 per cent of respondents reported having paid bribes.

When asked about dealing with services, telephone and natural gas utilities were the least likely to demand bribes, while law enforcement was the most frequent source (25 per cent of respondents who came in contact with the police were asked to pay a bribe) with courts the second most frequent source worldwide.

Corrupt police and judiciary mean rights denied

“The Barometer reveals that the police and the judiciary in many countries around the world are part of a cycle of corruption, demanding bribes from citizens,” said Transparency International Managing Director, Cobus de Swardt. “This troubling finding means that corruption is interfering with the basic right to equal treatment before the law.”

Transparency International has been campaigning strongly this year against corruption in the judiciary, based on its Global Corruption Report 2007. This report details how bribery affects the courts – judges and other judicial personnel accept bribes to delay or accelerate cases, to allow or deny an appeal, or to decide a case in a certain way. The Global Corruption Report 2007 also includes data from a 2002 survey showing, for instance, that 96 per cent of respondents in Pakistan who had contact with the lower courts encountered corrupt practices, while in Russia, an estimated US $210 million in bribes is thought to be paid in courts each year.

Bribes by sector: A regional perspective

Although globally the police are the institution most frequently reported to demand bribes, there are important differences across regions. In the countries of the greater EU region, medical services stand out as the most common source of bribe demands. In Latin America, Asia-Pacific and North America, petty bribery in the judiciary is a serious problem. In Africa and the Newly Independent States (Russia, Moldova and Ukraine), however, bribery was most prevalent in the education and health sectors, both vitally important to human development.

Petty bribery increased from 2006 to 2007 in some of the regions, such as Asia-Pacific (22 per cent of respondents reported paying a bribe to receive a service, up from 15 per cent) and South-East Europe (12 per cent, up from 8 per cent). Africa registered a slight decrease (42 per cent, down from 47 per cent).

“These sober figures underlie frightening real-world scenarios where money is extorted from innocent citizens in very vulnerable situations, such as during medical emergencies or when they are the victims of a crime,” said Huguette Labelle. “Entrenched bribery inflicts deep and lasting wounds on a society, destroying belief in those who govern.”

Political parties remain most affected by corruption

The Barometer also asks citizens which institutions they see as most affected by corruption. Year after year, political parties and parliaments – the very institutions entrusted to represent the public interest in political decision-making – take in first place.

“Our experience has shown that it is commitment at the top that will make or break efforts to fight corruption,” said de Swardt. “These troubling numbers show that government faces a crisis of legitimacy, with the potential to undermine democratisation, stability and the protection of human rights.”

The institutions which fared best in the eyes of ordinary citizens were religious bodies and non-governmental organisations (NGOs). Although still relatively clean, the perception of NGOs has worsened globally in comparison to 2004 survey results, as did the perception of private enterprises, indicating that these two sectors are under increasing public pressure to demonstrate transparency and accountability.

Public ready for a change

Public expectations about the extent of corruption in the future have become gloomier when compared to the Barometer 2003, with 54 per cent of respondents feeling that corruption would increase in the coming years – up from 43 per cent four years ago. In 2007, only one in every five respondents expected the level of corruption to decrease in the near future.

The Philippines and India stood out as the most pessimistic countries, with more than 79 per cent of respondents expecting an increase in corruption. Among the most pessimistic countries are Germany, Senegal, South Africa, Netherlands and the United Kingdom. But the negative outlook was not universal: interviewees in Bulgaria, Ghana, FYR Macedonia, Nigeria and Singapore were decidedly optimistic, believing that future levels of corruption will fall.

Governments not doing enough

Attitudes towards government anti-corruption efforts were similar to future expectations of corruption, with over half of all respondents rating their government as ineffective. Only one in three of those polled felt that their government was effective in battling corruption.

The general public was most sceptical, on average, in North and Latin America, the greater EU region and Asia-Pacific. That North Americans and Europeans see government efforts so negatively (with 19 and 28 per cent average approval ratings respectively), despite low levels of petty bribery, suggests that they are concerned about problems of grand corruption and the gap between the major graft that has been exposed and commitments to do something about it. The lack of an explicit approach to tackling corruption in the countries of the north may further aggravate this public uneasiness.

Notably, some of the African countries surveyed showed evidence of far greater optimism than that seen in the countries of North America and Europe. Wealthy countries in particular need to listen to what their citizens are saying and adopt the kind of comprehensive approaches to anti-corruption at home that they have demanded from aid recipient countries for years.

Women more pessimistic

Detailed analysis reveals that women are slightly more pessimistic than men about future levels of corruption. This contrasts with another finding of the 2007 Barometer, namely that women were less likely to pay a bribe than men, although this may be attributable to gender-based differences in the frequency and type of institutional contact.

The Barometer v. the Corruption Perceptions Index

The findings of the 2007 Global Corruption Barometer show a strong correlation (0.66) between the experience of bribery among ordinary citizens and the perceptions of corruption by experts, which are the basis for the Corruption Perceptions Index, TI’s flagship measurement tool. Those countries where business people, country analysts and experts perceive corruption to be widespread are the same ones where, on average, a higher proportion of citizens pay bribes for access to services

Conclusion: It is not just government that must work harder

“Turning promises into action is essential if anti-corruption efforts are to have an impact on the lives of ordinary people. Governments are key to making good on commitments to fighting corruption. But governments are not alone in their responsibility. We need to see concerted action from civil society and the private sector too,” concluded TI Chair Labelle. “People are punished by bribery and disgruntled by the corruption they believe plagues key public institutions and services. They deserve a future without corruption. The Global Corruption Barometer 2007 is a wake-up call – a reminder that people around the world are increasingly demanding an end to corruption and its terrible cost.”

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Note to editors:

The Global Corruption Barometer reflects the findings of a public opinion survey that looks at perceptions and experience of corruption. This year 63,199 people in 60 countries and territories were interviewed for the survey between June and September 2007. The Barometer survey has been carried out on an annual basis since 2003 on behalf of Transparency International by Gallup International Association as part of its Voice of the People Survey.

The full Barometer report and Frequently Asked Questions are available online at: http://www.transparency.org/policy_research/surveys_indices/gcb/2007

Bribe Payers Index (BPI)


http://www.transparency.org/policy_research/surveys_indices/bpi

The TI Bribe Payers Surveys evaluate the supply side of corruption - the propensity of firms from industrialised countries to bribe abroad. 

Foreign bribery by emerging export powers "disconcertingly high"

Overseas bribery by companies from the world’s export giants is still common, despite the existence of international anti-bribery laws criminalising this practice, according to the Transparency International 2006 Bribe Payers Index (BPI), the most comprehensive survey of its kind to date.

Overseas bribery by companies from the world’s export giants is still common, despite the existence of international anti-bribery laws criminalising this practice, according to the Transparency International 2006 Bribe Payers Index (BPI), the most comprehensive survey of its kind to date.

The BPI looks at the propensity of companies from 30 leading exporting countries to bribe abroad. Companies from the wealthiest countries generally rank in the top half of the Index, but still routinely pay bribes, particularly in developing economies. Companies from emerging export powers India, China and Russia rank among the worst. In the case of China and other emerging export powers, efforts to strengthen domestic anti-corruption activities have failed to extend abroad.

“Bribing companies are actively undermining the best efforts of governments in developing nations to improve governance, and thereby driving the vicious cycle of poverty,” said Transparency International Chair Huguette Labelle.

Respondents from lower income countries in Africa, for example, identified French and Italian companies as among the worst perpetrators.

“It is hypocritical that OECD-based companies continue to bribe across the globe, while their governments pay lip-service to enforcing the law. TI’s Bribe Payers Index indicates that they are not doing enough to clamp down on overseas bribery,” said David Nussbaum, Chief Executive of Transparency International. “The enforcement record on international anti-bribery laws makes for short and disheartening reading.”

“The rules and tools for governments and companies do exist,” said Nussbaum. ”Domestic legislation has been introduced in many countries following the adoption of the UN and OECD anti-corruption conventions, but there are still major problems of implementation and enforcement.”

USA BPI rank:  9 (tie)

USA BPI average score:  7.2

USA percentage of global exports (2005):  8.9

USA ratification of OECD Convention?  Yes

USA ratification of UNCAC?  No

Source: IMF, international finance statistics, 2005.

The results draw from the responses of more than 11,000 business people in 125 countries polled in the World Economic Forum’s Executive Opinion Survey 2006. A score of 10 indicates a perception of no corruption, while zero means corruption is seen as rampant. Leading the ranking is Switzerland, but even its score of 7.8 is far from perfect. The message: there may be variations here but there are no real winners.


Even high scorers are in major need of improvement. The behaviour of the Australian Wheat Board in the UN Oil-for-Food programme is just one example. In March of this year, German-US motor company DaimlerChrysler admitted that an internal probe confirmed allegations of 'improper payments' made by their staff in Africa, Asia and Eastern Europe.

The United States, which blazed new trails with its Foreign Corrupt Practices Act of 1977, ought to be leading the way, but ranks behind many OECD countries. The United Kingdom has demonstrated minimal enforcement of the Convention, despite scandals implicating firms such as British Aerospace. Transparency International has published periodic reports on Convention enforcement that show progress lagging across the OECD.


Following the supply chain

It is the subsidiary companies of multinationals that are being ranked by many of the respondents of this survey. But "companies must be ready to take responsibility for actions along their supply chains,” said Transparency International Board Member, Jermyn Brooks. "Multinationals cannot be absolved of the corrupt activities of their foreign branches, subsidiaries or agents, and they must conduct due diligence before engaging with joint venture or alliance partners. The purchasing, export, and marketing and sales departments remain the business functions most vulnerable to bribery and corruption."

The cost of a tarnished image ‘back home’ can be immense. And companies with a culture of bribery overseas face a heightened risk of being undermined by the unethical acts of their own employees. In the long run, it pays for companies to take proper measures to end corrupt practices.

Global standards for global justice

There is an active and growing international framework to address corruption in an increasingly globalised world. Progress has been made, particularly in the adoption of the OECD Anti-Bribery Convention, but its monitoring and enforcement must be more rigorous. Moreover, this progress will be undermined as long as major players such as China, India and Russia remain outside the framework. Major free riders outside the system are a strong disincentive for OECD-based companies and OECD countries to play by the rules. If the system breaks down, everyone will lose. Voluntary adoption of the provisions of the OECD Anti-Bribery Convention will show that countries take the problem of foreign bribery seriously and could potentially serve as a prelude to full OECD membership.