Business Perspectives on Corruption : Perception and Recommendations 2014 Survey Results.

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Presentation transcript:

Business Perspectives on Corruption : Perception and Recommendations 2014 Survey Results

Goals Create awareness against corruption Expose business perception of the corruption Discuss policy recommendations

Methodology A survey is conducted in Istanbul over a sample of 801 respondents, representative of the business community. The survey is based on nine in depth interviews in Istanbul and three focus group meetings in Denizli, Gaziantep and Antalya; the opinions of 36 business people in total are taken into consideration.

Corporate demographics Business line SmallMediumLargeTotal Other services Construction Wholesale & retail Accommodation Transport & communication Manufacturing Total

Top three problems Total Macro Problems Input PricesLaborPublic sphere problems Econ. Stability Political StabilityInf. Exch. Rates Int. Rates Gen. InputEnergy RentCostQualityTax Public Regul. Unre- corded Bribery and Corrupt

Corruption is frequent and large scale Frequency Scale

The perception of frequency and scale is lower in large companies

Highest perception is in construction; Lowest perception is in retail business

Corruption is on the rise

…and will keep rising

Unfairness or corruption? Business community is a bit confused

Top three causes of corruption: Inequality, power seeking and lack of enforcement

The cost of corruption is higher for small companies %0%1-5%6-10%11-15%16-20%21-25Average Small Medium Large

Economic impact: Unfair competition and shaken investor confidence Social impact : Insecurity

Corruption is a part of a whole What is to be done? Improving income distribution and reducing economic inequalities Education Judiciary independence and effective enforcement of the current legislation

Private sector still has its own to do list … 46% of the companies don’t have an ethical guidelines document. I wouldn’t report a corruption (%60) because There is no legal reporting procedure (%30) It wouldn’t yield a result (%12) I don’t want to wear myself out (%5) The system won’t reward me (%7) I am afraid that my identity will be revealed. (%6) I think today it's me, tomorrow it will be you (%1) Education

Goal: to create equal conditions in the market for all Examples: 1)Anti-Corruption declaration 2)Honesty agreement 3)Principle-oriented enterprises 4) Coalitions of certified companies A solution proposal: Collective Action

The participants supports Collective Action 67-77% of the participants state that the four kind of collective action may curtail corruption or raise awareness of its ill effects. HOWEVER Legal enforcement, auditing and clear sanctions are required. (%54)

Policy recommendations… Public Authorities NGO Private Sector

Thank you…