On January 27, 2016, Transparency International published its Corruption Perceptions Index (CPI) for 2015. The 2015 edition ranks 168 countries based on the perceived level of corruption in the country’s public sector. Overall, two-thirds of the countries on the 2015 index scored below 50, on a scale where zero is highly corrupt and 100 is very clean. Canada ranked in the top 10 least corrupt countries, with a score of 83. Denmark placed first, with a score of 91. The 2015 CPI is available for download here.

Canada’s 2015 CPI rank improved from 10th to 9th since 2014; and its score improved by two points. Canada has strengthened the robustness of its anti-corruption mechanisms including more active enforcement of the Corruption of Foreign Public Officials Act, which makes it a criminal offence in Canada for persons or companies to bribe foreign public officials in order to obtain or retain an advantage in the course of international business. 

The United States also climbed a rank in 2015 (to 16th), improving its score by two points (to 76). The U.S. Department of Justice (DOJ) has recently announced plans to intensify foreign corruption enforcement, in three key ways. First, in an October 2015 memo offering guidance on how government attorneys will target corruption, the DOJ adopted a strict approach towards eligibility for cooperation credit when corporations are under investigation. Second, the DOJ intends to prioritize prosecution of individuals. Third, the Foreign Corrupt Practices Act Unit is adding 10 new prosecutors in order to pursue high impact cases. 

China made a big leap in its CPI rank this year, rising from 100th in 2014 to 83rd although its actual score only improved by one point (to 37). Over the past three years, President of the People's Republic of China Xi Jinping has made the eradication of corruption a top priority — and a well-publicized one. China’s anti-corruption cases have quadrupled since 2013. Foreign companies are not immune to China’s anti-corruption campaign. Many foreign multinational firms have been investigated and fined for price fixing activities or bribery.

Also of interest to Canadian corporations with operations abroad:

  • The U.K. made significant improvements in its score, rising from 74 to 81 between 2012 and 2015, and earning a tie for 10th place this year.
  • Mexico rose eight ranks to 95th; although its score remained steady at 35, below China’s. 
  • Brazil was called out in the 2015 CPI report as a major regional decliner. It fell in the ranks from 69 to 76, and saw a five-point drop in its score, to 38. 
  • India showed no change in its score, tying Brazil with 38 points, despite India’s Prime Minister Narendra Modi’s stated attempts to make India a more transparent and predictable business environment for foreign investors. 
  • Russia made a big climb in the ranks, from 136th place in 2014 to 119th in 2015. Yet its score improved only two points. 

IMPLICATIONS

Given the international trend towards greater enforcement of anti-corruption rules, companies need to make corruption issues a top priority. Companies should develop and implement robust anti-corruption practices and continuously review them to deter and detect improper conduct.