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Bribe Payers Index

November 2, 2011

In many parts of the world, bribery is just a part of doing business. A new study by Transparency International shows Russian and Chinese companies pay kickbacks regularly, while German firms are cleaning up their acts.

Symbolic graphic of one man palming cash to another
Bribery affects some nations more than othersImage: Fotolia/Natalia D.

German engineering conglomerate Siemens saw its corporate reputation crumble at the end of 2006, when state prosecutors in Munich raided company offices to secure evidence of corrupt practices. Documents seized showed the Bavarian company had been manipulating its books to hide billions of euros worth of bribes paid to secure major contracts around the world.

The scandal marked a new low in corporate responsibility "made in Germany." But it may have also been a turning point that changed the way many of the nation's top managers think.

A new study by anti-corruption group Transparency International ranked Germany fourth in terms of corporate integrity, up from fifth place in 2008. The only countries considered less corrupt were the Netherlands, Switzerland and Belgium.

The worst of the 28 nations reviewed in the 2011 Bribe Payers Index (BPI) were Russia, China and Mexico.

Graphic element
Europe rated fairly well in the index

G20 support needed

To compile the 2011 BPI, researchers surveyed 3,000 top managers around the world about their attitudes towards bribery. They found illegal payments were most often used to secure major public contracts, remove regulatory obstacles and influence politicians.

The head of Transparency International, Huguette Labelle, said she hoped members of the G20 group of industrialized and emerging economies would lead by example and promote corporate integrity.

Transparency International Logo
Transparency International wants German lawmakers to disclose all sources of income

The G20 nations pledged to draft an anti-corruption action plan in 2010. Their initial progress is due to be evaluated at the upcoming summit in Cannes.

Labelle said China, India, Indonesia and Russia urgently need to intensify their anti-bribery measures. She added that if G20 nations strengthened their legal frameworks to combat corruption, they would not only help make the global economy fairer and more transparent but would also create economic conditions conducive to financial recovery and sustainable growth.

Mines and other gold diggers

In addition to the national BPI rankings, Transparency International conducted 19 studies of corrupt behavior in various public and private sectors of the economy.

Researchers confirmed previous findings that showed bribery is particularly widespread in the construction, energy and extractive industries.

For example: Corrupt civil servants in oil-rich Nigeria pocketed some $3.2 billion (2.3 billion euros) in bribes in the 2010/11 financial year alone.

Start at home

The chair of the German chapter of Transparency International, Edda Müller, criticized politicians in Berlin for not yet ratifying the United Nations Convention Against Corruption, which came into force in 2005.

German head of Transparency International, Edda Müller
Müller wants Berlin to ratify the United Nations Convention against CorruptionImage: picture-alliance/dpa

More than 150 countries have ratified the agreement, but Germany still lacks the legal framework to support the document. Under German law, bribes paid to parliamentarians are only considered illegal if they are used literally to buy their vote to achieve a specific goal.

Müller said the law should be broadened to prohibit any payments that allow companies or individuals to exercise "undue influence" over a lawmaker.

For years, Transparency International has been demanding that German politicians publicly disclose all sources of income, regardless of their value, to show they have nothing to hide. But parliamentarians are not required to do so.

Author: Marcel Fürstenau / sje

Editor: Sean Sinico