By Mini vandePol, and Vivian W. Wu
China’s ranking on Transparency International’s (TI) 2016 Corruption Perception Index (CPI) continues to improve, moving up four places to 79.
Significance of the CPI
The CPI was originally introduced in 1995 as a composite indicator used to measure perceptions of corruption in the public sector in countries around the world. Since then, it has been used as an important gauge by companies in managing corruption risks when conducting businesses in foreign countries. The 2016 CPI was published January 25, 2017.
A country or territory’s score indicates the perceived level of public sector corruption on a scale of 0 (highly corrupt) to 100 (very clean). A country or territory’s rank indicates its position relative to the other countries and territories in the index.
Highlights of the 2016 CPI
TI said this year’s results “highlight the connection between corruption and inequality, which feed off each other to create a vicious circle between corruption, unequal distribution of power in society, and unequal distribution of wealth.” The latest CPI is a reminder for companies that rely on its rankings to review their global compliance programs and make regional adjustments. Companies should pay attention to those countries and regions that have dropped significantly in the their rankings and scores, and identify compliance risks that were previously undetected.
Some highlights of the 2016 CPI include:
- More than two-thirds of the 176 countries and territories in this year’s CPI scored below 50 on the index scale of 0 to 100.
- More countries declined than improved, and a majority of Asia Pacific countries are in the bottom half of the CPI.
- China’s rank has continued to improve, moving up four places to 79 from 83, and its CPI score increased by three points.
- Hong Kong also improved, moving up…