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NZ country perceived to have least corruption

NZ retains top spot as country perceived to have least corruption

NZ shares top spot with Singapore and Denmark

NZ’s has a composite score of 9.3 out of 10 Only 44%of NZX50 companies have policies prohibiting bribery & corruption Somalia occupies bottom spot with a composite score of 1.1

New Zealand has retained its top spot as the country perceived to have the lowest level of domestic, public sector corruption according to Transparency International’s 2010 Corruption Perceptions Index (CPI). In 2009 New Zealand remained alone at number 1. This year we shared the top spot with Denmark and Singapore.

NZ achieved a score of 9.3 out of a maximum of 10, compared with a score of 9.4 last year.

Somalia (1.1), Myanmar (1.4), Afghanistan (1.4) and Iraq (1.5) occupy the bottom four places.

Alex Tan, Transparency International NZ director says “Whilst the result is pleasing, there is no room for complacency.

The CPI measures perception of corruption and not hard data. We note that in April this year the Serious Fraud Office announced an investigation into serious allegations of corruption at a public entity”

The CPI only measures the degree to which corruption is perceived to exist among public officials and politicians in New Zealand. It does not take into account the attitudes of the private sector when conducting business here and overseas.

Transparency International NZ is very concerned about the apparent lack of awareness about issues of corruption amongst the private sector in New Zealand. In February 2010 we released a study into NZ private sector attitudes towards corruption. Key findings of the survey were:

Only 44% of companies on the NZX50 have policies prohibiting bribery & corruption (this compares with 72% in the UK and 68% in the US) Only 14% of companies listed on the NZX 50 have sought to control the way in which facilitation payments are made by adding restrictions into their codes of conduct Only 10% prohibit facilitation payments altogether.

Mr Tan says “When we look at the study results for the NZX50 and then factor in the 2010 CPI results of some of our major trading partners, for example China is 78th with a composite score of 3.5, we believe there is a real risk that New Zealand organisations do not take the risks of bribery and corruption seriously when operating offshore.”

We also call upon the government to do more to strengthen our regulatory and legislative environment in respect of combating bribery and corruption. Although NZ signed the United Nations Convention Against Corruption (UNCAC) in 2003, we are one of only 18 countries not to have ratified it. 122 countries have both signed and ratified UNCAC.

Mr Tan says “For a country that consistently tops the CPI, the fact that seven years after signing UNCAC we still have not ratified it is somewhat hard to fathom”.

Whilst the Crimes Act 1961 makes it an offence for NZ entities, citizens or residents to bribe a foreign official, New Zealand has never recorded a conviction for such an offence. This has drawn adverse comment from the OECD.

Mr Tan adds “We know that New Zealand organisations operating overseas are sometimes under pressure to make inappropriate payments in order to obtain or retain business. The use of overseas agents also presents a significant risk which is often overlooked. The clear trend overseas is to enact and enforce legislation to strictly control both domestic and foreign corruption, including the use of agents. The UK has just passed the Bribery Act 2010 which has very strict provisions especially in terms of corporate governance and America rigorously enforces the Foreign Corrupt Practices Act. It is time for New Zealand to follow suit.”

Whilst we can be justifiable proud about remaining at the top of the CPI, there is still much work to do especially amongst the private sector.

ENDS

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