“Corruption not only affects business relationships but poses a considerable risk inside an enterprise. This report documents many cases of managers, majority shareholders and other actors inside corporations who abuse their entrusted powers for personal gain, to the detriment of owners, investors, employees and society at large. Executives, for example, may focus opportunistically on securing generous payouts to themselves, rather than on long-term profi tability and sustainability – a phenomenon that has been identifi ed as an important factor in the current fi nancial crisis. Majority owners may try to leverage their infl uence on corporate strategy to expropriate smaller shareholders through ’self-dealing’ and similar practices. The benefits of majority control are estimated to exceed 30 per cent of equity value in countries such as Austria, Italy, Mexico and Turkey. They amount to as much as 60 per cent or so of equity value in the Czech Republic and Brazil, raising serious concerns about checks on the powers of these actors.”
“Countries such as Brazil, China and India already boast some of the world’s largest markets, and their companies play an increasingly active and important role in global business. As this report documents, encouraging efforts are under way to update many aspects of regulatory and governance standards in these countries. Nevertheless, these efforts need to be deepened and extended beyond the ‘first in class’ companies. Firms from India, China and Brazil are regarded by their peers as among the most corrupt when doing business abroad.“
Would you like to increase your awareness about corruption in the world ? Access Transparency International – the global coalition against corruption.
Check out the Integrity Awards Winners from past years.
Read the Global Corruption Barometer 2009.
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