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Russian and Chinese companies 'most likely to bribe'

2011-11-02 10:34:47

Companies from Russia and China are most likely to pay bribes when doing

business abroad, a survey suggests.

The two scored worst out of 28 countries in a poll of 3,000 business executives

conducted by anti-corruption group Transparency International (TI).

The Netherlands and Switzerland came top, while the UK ranked eighth, just

ahead of the US and France.

Bribery was reportedly most common to win public sector works and construction

contracts.

'No integrity'

"It is of particular concern that China and Russia are at the bottom of the

index," said TI in its report.

"Given the increasing global presence of businesses from the countries, bribery

and corruption are likely to have a substantial impact on societies in which

they operate and on the ability of companies to compete fairly in these

markets."

Other major developing economies came much higher up the rankings. India was

19th, while Brazil, in 14th place, was one spot ahead of Italy.

The report called for more international action to outlaw companies from paying

bribes in foreign countries.

Bribe Rankings - worst offenders last

1. Netherlands, Switzerland

3. Belgium

4. Germany, Japan

6. Australia, Canada

8. Singapore, UK

10. US

11. France, Spain

13. South Korea

14. Brazil

15. Hong Kong, Italy, Malaysia, South Africa

19. India, Turkey

22. Saudi Arabia

23. Argentina, UAE

25. Indonesia

26. Mexico

27. China

28. Russia

"G20 governments must tackle foreign bribery as a matter of urgency," said

Huguette Labelle, chair of TI, who said that more resources must be dedicated

to investigations and prosecutions.

Russia, which came bottom of the league, was seen by TI as a particularly

challenging case.

"Unfortunately... there are no islands of integrity in Russian public and

business life," said TI Russian director, Elena Panfilova.

'Cheating taxpayers'

Survey respondents were asked to say how likely companies from each of the

foreign countries were to offer back-handers.

Bribe-paying was seen as much more common by businessmen from countries whose

governments were also considered to have the least integrity, according to a

separate "corruption perceptions" survey carried out by TI last year.

The sector most affected by bribery was public procurement - where companies

compete to win contracts from governments for everything from waste collection

to road building.

TI noted that the nature of public sector contracts - which are usually large,

complex and involve many sub-contractors - makes it much easier to inflate

costs and hide inappropriate payments.

However, TI said that paying bribes to win major infrastructure and housing

projects "effectively cheats taxpayers out of their money" and can undermine

safety standards.

The survey indicated that companies paid bribes almost as routinely to other

businesses as they do to government officials.

The mining and the oil and gas sectors - in which Russia and China are most

active - also scored low in the poll.

Agriculture was considered the least bribe-prone, while banking ranked the

fourth least-corrupt out of 19 industries.