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2015 Defence Companies Anti-Corruption Index Event

Written by Jameela Raymond on Monday, 4 May 2015

The second iteration of the Defence Companies Anti-Corruption Index (CI) from Transparency International’s Defence and Security Programme, was launched on Monday 27 April. Last Thursday, we held an event to discuss the index findings and some of the broader issues surrounding corruption in the defence sector.


 

The second iteration of the Defence Companies Anti-Corruption Index (CI) from Transparency International’s Defence and Security Programme, was launched on Monday 27 April. Last Thursday, we held an event to discuss the index findings and some of the broader issues surrounding corruption in the defence sector.

Mark Pyman, Programme Director, spoke to the history of the Programme, the rationale behind the creation of the index in 2012 and the importance of continuing it in the future. Katie Fish, Project Manager for the index, discussed the research methodology and key findings. This included a focus on the corruption risks surrounding offset contracting. Jan Pie, Secretary General of the AeroSpace and Defence Industries Association of Europe, offered an industry perspective on corruption and the impact of the CI on the problem.

The CI assesses the transparency and quality of defence companies’ ethics and anti-corruption programmes using publicly available information. Based on the extent of public evidence, companies are placed into one of six bands from A (highest scoring) to F (lowest scoring). A questionnaire based around five ‘pillars’ – leadership, governance and organisation; risk management; company policies and codes; training, and; personnel and helplines – is used to assess company ethics and anti-corruption programmes.

The CI assesses 163 companies, compared to 129 in 2012, and spans 47 countries. Some of the key findings that Pyman touched upon include:

  • The majority of the companies show little evidence of ethics and anti-corruption programmes – a quarter of the companies had no evidence of them whatsoever
  • Two-thirds of the companies are in bands D to F – the lower half of the index
  • Agents: Only 13 companies provide evidence of regular due diligence on agents
  • Whistleblowing: Only 8 companies provide evidence of whistleblowing programmes that encourage and support whistleblowers
  • Offsets: Only 3 companies provide evidence of good anti-corruption procedures for offsets

Some improvements have taken place since the index’s debut in 2012:

  • A number of defence companies now address corruption risks more systematically
  • 60% of companies score better and one-third have improved by one band or more
  • 17% of companies are in bands A and B, compared with 8% in 2012
  • Improvement is evident in all regions of the world

However, there is still much more to be done to tackle corruption in the defence sector. We recommend that companies encourage and support whistleblowing, and implement stringent regulations around offsets and the use of agents or third parties. Governments should seek to improve their own procedures and require that contractors have robust ethics and anti-corruption programmes. A nationalised survey or index of defence corruption would offer further insights into the quality of companies’ anti-corruption efforts.

At TI-UK, we will be launching the second iteration of our Government Defence Anti-Corruption Index (GI) later this year. Along with the CI, these indices will assess both supply and demand sides of corruption risk in the defence sector, and identify where improvements need to be made.

The 2015 Defence Companies Anti-Corruption Index can be found at companies.defenceindex.org and you can read the report online here.

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Read 2507 times Last modified on Tuesday, 24 November 2015 11:48
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Jameela Raymond

Jameela is Transparency International UK's Senior Policy Officer. You can follow her on Twitter @jameelaraymond

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