In brief

Transparency International (TI) released its 2020 Corruption Perception Index (CPI) on 28 January 2021.1 TI has reported that with an average score of 45, the Asia Pacific region struggles to combat corruption and tackle the health and economic impact of COVID-19. 

Our alert discusses some of the highlights of the 2020 CPI and what it means for companies doing business in China and the region.


Key takeaways

TI's CPI continues to be an important gauge for assessing corruption risk and is a helpful tool when doing business in the region. The 2020 CPI ranks 180 countries and territories by their perceived levels of public sector corruption, according to experts and business people. The CPI uses a scale from zero (highly corrupt) to 100 (very clean). Companies should pay close attention to those countries and regions that score poorly on the index, and identify any compliance risks that may be previously undetected.

TI's latest report highlights the impact of corruption on government responses to COVID-19, comparing countries’ performance in the index to their investment in healthcare and the extent to which democratic norms and institutions have been weakened during the pandemic. TI's research shows that corruption is more pervasive in countries least equipped to handle the COVID-19 pandemic and other global crises. TI's research also looked at foreign bribery in the global export space and found that many countries that export goods and services heavily are failing to investigate and prosecute companies that pay bribes to win business abroad.

In China and the region generally, given the shifting sands of the business environment brought about by increasing economic pressures and geo-political tensions, companies need to remain vigilant against risks arising from government touch-points and business models that rely upon third-party relationships, such as those with agents or intermediaries. As outlined in our recent alert, China introduced into its legislation the concept of compliance management on 1 January 2021. This means that compliance policies, robust internal controls and on-the-ground implementation measures remain at the forefront of 2021 priorities.

Highlights of TI's 2020 CPI scores

  • Asia Pacific has an average score of 45 on the CPI and ranked above other regions such as the Americas (43), Middle East & North Africa (39), Eastern Europe & Central Asia (36) and Sub-Saharan Africa (32).
  • With a score of 88, New Zealand is consistently one of the top performers on the CPI, both in the region and around the world.
  • Singapore, Australia, Hong Kong and Japan follow New Zealand closely in the Asia Pacific region.
  • China improved steadily on the CPI, increasing by six points, from a score of 36 in 2014 to 42 in 2020.
  • Myanmar is a significant improver on the CPI, increasing by 13 points since 2012 to a score of 28 in 2020.
  • The table below sets out some key jurisdictions in Asia Pacific, showing their 2020 CPI rankings and scores against their 2019 position.

Jurisdiction

CPI score 2020

Rank 2020

CPI score 2019

Rank 2019

New Zealand

88

1

87

1

Singapore

85

3

85

4

Australia

77

11

77

12

Hong Kong

77

11

76

16

Japan

74

19

73

20

Taiwan

65

28

65

28

Korea, South

61

33

59

39

Malaysia

51

57

53

51

China

42

78

41

80

India

40

86

41

80

Indonesia

37

102

40

85

Thailand

36

104

36

101

Vietnam

36

104

37

96

Philippines

34

115

34

113

Myanmar

28

137

29

130

Cambodia

21

160

20

162