Telecommunications is one of seven sectors selected as higher risk, based on findings from Transparency International’s Bribe Payers Index and on expert opinion gathered researchers.
These sectors are Oil and Gas Operations, Basic Materials (including Forestry and Mining), Aerospace and Defence, Capital Goods (including Engineering), Construction, Telecommunication Services, and Utilities.
The findings are contained in a report titled “2009 Transparency in Reporting on Anti-Corruption: A Report on Corporate Practices.’
Five hundred of the world’s largest publicly-traded companies were analysed. The choice to assess listed companies rather than state-owned or privately owned companies reflects the need of these companies to adhere to the extensive regulatory and reporting standards prescribed by financial authorities, thereby ensuring a greater commonality of reporting criteria.
Companies are thought to be at higher risk when their operations involve them in regular licensing or contracts from, or regulation by, the public sector and/or where the company operates in multiple countries, including those where corruption is widespread, and/or where there is significant use of agents and other business intermediaries.
On average, the 225 companies in these seven higher risk sectors overall scored almost identically to companies in the remaining sectors. However, the relatively high average TRAC scores achieved by a minority of companies in some high risk sectors boosts the overall average and masks the fact that these sectors also include some of the poorest performers.
Two high risk sectors—Oil and Gas Operations and Basic Materials—have a significant number of major companies reporting that they have more advanced systems in place.
However, in both sectors, there are major players who appear to be doing little or nothing on the issue, based on the information they communicate publicly.
Reporting practices in these sectors appear especially polarised between leaders and laggards.
There has traditionally been an emphasis, for obvious reasons, on examining the Oil and Gas and Aerospace and Defence sectors. The study suggests that other high risk sectors may not be getting the attention they deserve—in particular the Construction and Capital Goods sectors.
In sectors such as these, the number of leaders is few and the number of laggards many.
These results reflect the findings of several editions of the TI Bribe Payers Index, which shows that business experts view corruption as a very real risk in the Construction and Engineering sectors.
A surprisingly large number of major players in the Capital Goods industry, many associated with major global engineering projects, disclose little or no information on their policies and systems to combat bribery.
Northern American companies in higher risk sectors are more inclined to report that they have some policies and systems in place, probably for regulatory reasons. This suggests that a strong regulatory environment is helpful in raising the overall minimum standards in a country.
Chinese, Indian and Russian companies in higher risk sectors are disproportionately rated as laggards.

---