Published annually, the chapter-based international movement's Corruption Perceptions Index (CPI) measures perceptions of public sector corruption in 180 countries and territories through expert assessments and surveys of business executives, giving each country a score from zero (highly corrupt) to 100 (very clean).This year’s CPI shows the US dropping four points on its 2017 score, removing it from the top 20 countries on the CPI for the first time since 2011, as well as faltering progress globally. The findings may prompt companies operating globally to review their anti-corruption policies and processes, especially as increasing economic protectionism and trade wars heighten national governments' focus on regulatory infringements and to ensure employers are doing enough to guide, protect and support expatriate and mobile workers.

Fall a 'red flag'

Explaining what the decline means according to the NGO's analysis, Zoe Reiter, acting representative to the US at Transparency International, said: “A four-point drop in the CPI score is a red flag and comes at a time when the US is experiencing threats to its system of checks and balances, as well as an erosion of ethical norms at the highest levels of power.“If this trend continues, it would indicate a serious corruption problem in a country that has taken a lead on the issue globally." 

The overall picture – a global corruption crisis?

The study further reports that more than two-thirds of countries scores below 50 in the 2018 CPI. The global average is 43, comprising regional averages of 66 for Western Europe and the European Union, the Americas (44) and Asia Pacific.That these scores have remained fairly static leads Transparency International to conclude progress towards eradicating corruption has faltered, with potential consequences for global growth.Since 2012, only 20 countries have significantly improved their scores, including Côte D’Ivoire.Sixteen have significantly declined, including, Australia, Chile and Malta.Somalia, Syria and South Sudan – all current war zones – are at the bottom of the index, with 10, 13 and 13 points respectively.

Safe havens from corruption 'correspond with strong democracy'

Denmark and New Zealand top the Index with 88 and 87 points, respectively. The UK slips to 11 from eighth place last year because of what the authors call a statistically not significant drop in the overall score of two points.Cross analysis with global democracy data reveals a link between corruption and the health of democracies, which former UK foreign secretary Sir Malcolm Rifkind talked about from the perspective of economic growth, the rule of law and global mobility at the 2016 Worldwide ERC® EMEA Talent Mobility Summit. “Corruption chips away at democracy to produce a vicious cycle, where corruption undermines democratic institutions, and in turn, weak institutions are less able to control corruption,” said Patricia Moreira, managing director of Transparency International.“Around the world, we need to do more to strengthen checks and balances and protect citizens’ rights, and the US is no exception.”Full democracies score an average of 75 on the CPI, with no full democracy scoring less than 50. Shedding further light on the US’s declining CPI ranking, the US was in 2016 downgraded from a full to a flawed democracy in the Democracy Index, a gradual downward trend which started in 2008.The new assessment of perceptions comes as President Trump is at loggerheads with the Senate over the budget needed to enact his campaign pledge to build a wall between the US and its neighbour, Mexico, precipitating over four weeks of partial federal government service shutdowns and some civil servants left unpaid.

What is happening to democracy in the US?

In 2018, the US received its lowest Freedom in the World Index score for political rights since 1972 when measurement began.In 2017, a public opinion survey published by Transparency International showed that the US government is losing citizens’ trust. According to the survey, nearly six in ten Americans believed that the US was more corrupt than the previous year, with the White House considered the most corrupt institution in the US.“The expert opinion captured by the CPI supports the deep concern over corruption in government reported by Americans in our 2017 survey," added Zoe Reiter.

Four steps for fighting corruption

Transparency International emphasises the following as essential pre-requisites for fighting corruption:

1. A robust system of checks and balances on political power.
2. Effective controls against conflicts of interest and private influence over government decisions.
3. Citizen participation in politics and protections against voter suppression and other forms of disenfranchisement.
4. A free, diverse and pluralistic media with regular and equal access to those in power. 

Head to our Enterprise section for more news and insight.  

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