Transparency International: Global firms silent on local deals, states report
Claims British companies best, Chinese worst performers on transparency
The world’s biggest companies disclose little or no financial details about their operations outside their home country, a new report from Transparency International revealed.
Ninety of the 124 companies assessed do not disclose the taxes they pay in foreign countries, while 54 disclose no information on their revenues in other countries, the report said, according to the Pakistan chapter of Transparency International.
The report, Transparency in Corporate Reporting, analysed 124 companies from the Forbes list of the world’s biggest publicly-traded companies.
The companies, whose combined market value is more than $14 trillion, are ranked based on their reporting of the measures they take to prevent corruption, information about subsidiaries and holdings, and key financial information about overseas operations, said the report.
According to these criteria, UK companies are the best performers and Chinese companies the worst, the report published by Transparency International Pakistan said.
“We need more transparency from multinational companies, whose power in the world economy closely rivals the biggest countries,” said Transparency International Chair, José Ugaz. “With greater economic power comes greater responsibility. Bad corporate behaviour creates the corruption that causes poverty and instability. By not responding to people’s demands for greater transparency and accountability, companies risk harming their brand and losing customers,” Ugaz said.
New rules for EU
The report shows that the world’s biggest oil, gas and mining companies are not ready for the kind of transparency rules that will enter into force across the EU from July 2015.
Of the 24 extractive companies in the report who would fall under the new EU and US rules, 19 disclose tax payments and revenue in less than half the countries where they operate.
“Companies have to provide more information on financial operations. Transparency allows citizens to find out the extent of a company’s operations in their country. It is also essential to follow money flows between governments and companies that can be subject to corruption,” said Ugaz.
Published in The Express Tribune, November 6th, 2014.