BERLIN: July 11, 2016. A report from corruption watchdog Transparency International (TI) says the lack of transparency by many of the world’s biggest emerging market companies is creating an environment for corruption to thrive.
TI says 100 of the fastest-growing companies based in 15 emerging markets, and operating in 185 countries around the world, scored an average of 3.4 out of 10 on its new index - with 0 being the least transparent.
As in the 2013 edition of the study, no company achieved a 100 percent in reporting its anti-corruption program. However Turkey’s Sabanci Holding - owner of fast-growing Pegasus Airlines – tops the list with a score of 96 percent (12.5 out of 13 points).
TI notes that 51 out of the 100 companies achieved results of 50 percent or more, while seven companies didn’t get above zero: Charoen Pokphand, Chery, Galanz, Indofood, Shunfeng, Wanxiang, and Zoomlion.
Among the BRICS economies, companies from India and South Africa both scored 64 percent, those from Russia 62 percent, and firms from Brazil, 55 percent. Chinese companies averaged 26 percent on the index although some achieved high scores: ZTE, 88 percent, Lenovo, 69 percent, and Li & Fung and Sinohydro 65 percent each.
“Pathetic levels of transparency in big emerging market companies raises the question of just how much the private sector cares about stopping corruption, stopping poverty where they do business and reducing inequality said TI chairman José Ugaz. “Time and again we see huge corruption scandals involving multinationals, such as Odebrecht Group or China Communications Construction Company, doing immense damage to local economies.”
TI says anti-corruption programs that keep a company from using bribery as a tool or provide ways for whistleblowers to report corruption must be made publicly available to send a clear message to their customers, staff and partners: “Customers should demand the companies they patronize live up to the highest anti-corruption standards or risk losing their business,” Ugaz added.
So far this year Pegasus has added Amman and Gabala in Azerbaijan to its network, bringing the number of destinations it serves to 103 in 41 countries.