International - Written by on Tuesday, January 17, 2012 16:06 - 1 Comment

Global anti-corruption enforcement – TRACE: statistics you *should* read

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Since 1977 the UK is the second most aggressive law enforcer worldwide when it comes to enforcement of overseas corruption violations.

Confounding popular belief the TRACE report records that between 1977 and July 2011 the UK was the world’s second most active enforcer of overseas corruption with 32 cases accounting for 5% of the total.

Continuing our theme on statistics the TRACE Global Enforcement Report 2011, published in 2011, is choc full of statistics.

While the Transparency International Corruption Perception Index is to some extent based on perception the TRACE report looks at actual enforcement statistics from court documents public company filings and the like.  In doing so it is arguably a more accurate (and useful?) overview of the historic position.

Unsurprisingly, according to the TRACE report, the US wins the prize with a massive 74.1% of the enforcement activity and 468 cases.

While these statistics are anecdotally interesting of key interest to Directors and Officers should be the answer to two key questions:

Where is bribery happening and in what industry is it most prevalent?

The TRACE report offers answers for both.

Where does the misconduct occur?

According to the report China tops the list with Iraq, Nigeria India and Mexico together in the top 5.

Surprisingly Russia does not make it into the top 5 (it is in the top 10).   The same is true for a number of former USSR countries.

This could be because the sample period begins in 1977 when the USSR was effectively closed to foreign investment only opening up under Perestroika in the early ‘90’s.

We expect Russia and some others to climb in the rankings.

Which Industries are targeted?

The report charts 13 industries.

In a stark statistic the top five account for 60% of the enforcement activity.

Extractive industries top the list with nearly 20% of the enforcement activity with aerospace defence & security, manufacturing and service providers, healthcare, engineering & construction and healthcare also appearing in the top 5 and each accounting for 10%.

TIP

If you are conducting a risk assessment the TRACE Global Enforcement Report should be a key starting point to be considered alongside the Transparency International Corruption Perception Index.

For those whose industries feature in the top 5 for enforcement the message is clear: ensure that there are clear and effectively implemented anti-bribery measures in place.

 

 

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Robert Barrington
Feb 6, 2012 5:17

I’d like to draw your readers’ attention to two othersets of data, both based on opinion surveys:

1. The TI Bribe Payers’ Index, a poll of 3,000 global executives, giving their opinions of which countries’ companies are most likely to pay bribes, and the sectors in which bribe-paying is most prevalent
2. The TI Global Corruption Barometer, an opinion survey of about 90,000 people in 80 countries, asking them how frequently they have paid a bribe in the past year, how much, who to, etc.

Robert Barrignton
Director of External Affairs
Transparency International UK

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