1. 1 THE LEVEL OF PERCEPTION OF CORRUPTION BY BUSINESS: 2 nd WAVE Survey results of August-October 2015

2. 2 Survey methodology This presentation is based on the results of the 2 nd wave of the research «The level of perception of corruption by business». The period of conducting the survey – August-October 2015. The mode of the survey – phone interviews with representatives of enterprises. A respondent – the management of enterprises. Total number of the surveyed enterprises – 2 271. Survey sampling is proportional to the number of the registered in Ukraine and economically active enterprises according to the following features: Oblast of enterprise registration (all the oblasts of Ukraine, excluding Crimea and ATO zone in Donetsk and Luhansk oblasts); The branch of an enterprise according to SIC (agriculture, industry, trade, transport and communications, other services). The enterprises for conducting a survey were sampled in a random way. For conducting the data analysis, the sampling was gone behind so that the distribution of enterprises according to the branches and oblast of registration correspond to the data of the State Statistics Committee of Ukraine. It was done to remove the sampling shifts, connected with different level of consent to give interview among the various groups of respondents. The data shown in the presentation: On the whole as to the surveyed sampling for the 2 nd wave, and also in view of the branch of enterprises and the oblast of their registration; In dynamics comparing with the previous wave of research, conducted in February-March 2015. Green and red frames/arrows at the graphics indicate: Statistically considerable differences in the analyzed group comparing with the total survey sampling in the data for the 2 nd wave. Marked green – if the indicator in the analyzed group is higher than the average one in the sampling on the whole, marked red – lower (level of significance 90%). Statistically considerable changes in the indicators comparing with the previous wave of the research. Marked green – if the indicator has considerably increased, marked red – has decreased (level of significance 90%). A margin of error of the research is not the same for all the data, depends on the amount of the respondents who answered the questions, and the part of each separate characteristics. The maximum margin of error for the total surveyed sampling of the 2 nd wave (with a probability of 90%) – 2,1%.

3. 3 Characteristics of the surveyed enterprises – the 2 nd wave BRANCH OF AN ENTERPRISE / OBLAST OF REGISTRATION OF AN ENTERPRISE % to all the respondents, N = 2271 Branch Oblast

4. 4 Perception of changes as to corruption – 2 nd wave HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED. DISTRIBUTION OF ANSWERS ACCORDING TO ESTIMATES % to all the respondents, N = 2271 -0,80 Average progress estimate in fighting corruption in Ukraine 30,6% consider that the corruption situation has changed for the worse in the past 6 months 17,4% consider that the corruption situation has improved in the past 6 months

5. 5 Perception of changes as to corruption – dynamics HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED.. DISTRIBUTION OF ANSWERS ACCORDING TO ESTIMATES % to all the respondents, 1 st wave, N = 2741; 2 nd wave, N = 2271 -0,77 -0,80 Average progress estimate in fighting corruption in Ukraine 1 ST WAVE 2 ND WAVE The frames indicate the statistically considerable differences between the data of the 1 st and 2 nd waves (level of significance 90%). Marked green – value in the 2 nd wave has increased, marked red- decreased 1 ST wave 2 nd wave

6. 6 Perception of changes as to corruption: in view of various groups of surveyed enterprises – the 2 nd wave (1) HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED.. CORRUPTION SITUATION HAS CHANGED FOR THE WORSE % of those who chose an estimate «-5» - «-1» to the corresponding group of enterprises The frames indicate the statistically considerable differences in the performance evaluation among the corresponding group of the surveyed comparing with the analogous sampling evaluation on the whole (level of significance 90%). Marked green – the significance in the corresponding group is higher by sampling on the whole, marked red - lower CORRUPTION SITUATION HASN’T CHANGED % of those who chose an estimate «0» to the corresponding group of enterprises CORRUPTION SITUATION HAS IMPROVED % of those who chose «+1» - «+5» to the corresponding group of enterprises Branch Encountered or not with corruption

7. 7 Perception of changes as to corruption: in view of various groups of surveyed enterprises – the 2 nd wave HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED. CORRUPTION SITUATION HAS CHANGED FOR THE WORSE % of those who chose an estimate «-5» - «- 1» to the corresponding group of enterprises The frames indicate the statistically considerable differences in the performance evaluation among the corresponding group of the surveyed comparing with the analogous sampling evaluation on the whole (level of significance 90%). Marked green – the significance in the corresponding group is higher by sampling on the whole, marked red – lower. CORRUPTION SITUATION HASN’T CHANGED % of those who chose an estimate «0» to the corresponding group of enterprises CORRUPTION SITUATION HAS IMPROVED % of those who chose «+1» - «+5» to the corresponding group of enterprises Oblast

8. 8 Perception of changes as to corruption: in view of various groups of surveyed enterprises – dynamics (1) HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED. CORRUPTION SITUATION HAS CHANGED FOR THE WORSE % of those who chose an estimate «- 5» - «-1» to the corresponding group of enterprises CORRUPTION SITUATION HASN’T CHANGED % of those who chose an estimate «0» to the corresponding group of enterprises CORRUPTION SITUATION HAS IMPROVED % of those who chose «+1» - «+5» to the corresponding group of enterprises Branch Encountered or not with corruption 1 st wave 2 nd wave The arrows indicate statistically considerable differences between the data of the 1st and 2nd waves (level of significance 90%). Marked green – the value in the 2 nd wave has increased, marked red – has decreased.

9. 9 Perception of changes as to corruption: in view of various groups of surveyed enterprises – dynamics (2) HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED. CORRUPTION SITUATION HAS CHANGED FOR THE WORSE % of those who chose an estimate «-5» - «-1» to the corresponding group of enterprises CORRUPTION SITUATION HASN’T CHANGED % of those who chose an estimate «0» to the corresponding group of enterprises CORRUPTION SITUATION HAS IMPROVED % of those who chose «+1» - «+5» to the corresponding group of enterprises Oblast 1 ST wave 2 nd wave The arrows indicate statistically considerable differences between the data of the 1 st and 2 nd waves (level of significance 90%). Marked green – the value in the 2 nd wave has increased, marked red – has decreased.

10. 10 Perception of changes as to corruption: by branches – 2 nd wave HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED. Average estimate from «-5» to «+5» Statistically considerable differences in the performance evaluation among the corresponding group of the surveyed comparing with the analogous sampling evaluation on the whole have not been found (level of significance 90%). AGRICULTURE, N=330 TRANSPORT AND COMMUNICATIONS, N=100 TRADE, N=541INDUSTRY, N=281 OTHER BRANCHES, N=1019 TOTAL, N=2271

11. 11 Perception of changes as to corruption: by branches – dynamics HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED.. Average estimate from«-5» to «+5» AGRICULTURE TRANSPORT AND COMMUNICATIONS TRADEINDUSTRY OTHER BRANCHES TOTAL The frames indicate statistically considerable differences between the data of the 1st and the 2nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased. 1 st wave 2 nd wave

12. 12 Perception of changes as to corruption: by oblasts – 2 nd wave HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED. Average estimate from «-5» to «+5» ЛУГАНСЬКА, N=52 ХМЕЛЬНИЦЬКА, N=53 ЧЕРНІВЕЦЬКА, N=53 ТЕРНОПІЛЬСЬКА, N=50 ОДЕСЬКА, N=148 ХЕРСОНСЬКА, N=51 ЖИТОМИРСЬКА, N=50 ЗАКАРПАТСЬКА, N=54 ЧЕРКАСЬКА, N=57 МИКОЛАЇВСЬКА, N=66 ХАРКІВСЬКА, N=148 ЛЬВІВСЬКА, N=118 ВОЛИНСЬКА, N=53 М.КИЇВ, N=508 КИЇВСЬКА, N=101 ЧЕРНІГІВСЬКА, N=50 КІРОВОГРАДСЬКА, N=52 СУМСЬКА, N=50 ПОЛТАВСЬКА, N=73 ДНІПРОПЕТРОВСЬКА, N=172 ВІННИЦЬКА, N=58 РІВНЕНСЬКА, N=57 ДОНЕЦЬКА, N=50 ЗАПОРІЗЬКА, N=97 ІВАНО-ФРАНКІВСЬКА, N=50 ЗАГАЛОМ, N=2271 The frames indicate statistically considerable differences in the performance evaluation among the corresponding group of the surveyed comparing with the analogous sampling evaluation on the whole (level of significance 90%). Marked green – value in the corresponding group is higher than in the sampling on the whole, marked red – lower.

13. 13 ЛУГАНСЬКА ХМЕЛЬНИЦЬКА ЧЕРНІВЕЦЬКА ТЕРНОПІЛЬСЬКА ОДЕСЬКА ХЕРСОНСЬКА ЖИТОМИРСЬКА ЗАКАРПАТСЬКА ЧЕРКАСЬКА МИКОЛАЇВСЬКА ХАРКІВСЬКА ЛЬВІВСЬКА ВОЛИНСЬКА М.КИЇВ КИЇВСЬКА ЧЕРНІГІВСЬКА КІРОВОГРАДСЬКА СУМСЬКА ПОЛТАВСЬКА ДНІПРОПЕТРОВСЬКА ВІННИЦЬКА РІВНЕНСЬКА ДОНЕЦЬКА ЗАПОРІЗЬКА ІВАНО-ФРАНКІВСЬКА ЗАГАЛОМ Perception of changes as to corruption: by oblasts – dynamics HOW WOULD YOU SIZE UP THE CORRUPTION SITUATION IN OUR PUBLIC AUTHORITIES IN THE PAST 6 MONTHS: ON A SCALE FROM «-5» TO «+5», WHERE «-5» – THE SITUATION HAS CONSIDERABLY CHANGED TO THE WORSE, «0» – HASN’T CHANGED, «+5» – HAS CONSIDERABLY IMPROVED.. Average estimate from «-5» to «+5» The frames indicate statistically considerable differences between the data of the 1 st and the 2 nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased. 1 st wave 2 nd wave

14. 14 Encountered or not with corruption in the past 6 months – dynamics PLEASE TELL US IF A PUBLIC AUTHORITY INDUCED YOUR COMPANY TO BRIBE IN THE PAST 6 MONTHS? WHAT PUBLIC AUTHORITY WAS IT? % to all the respondents, 1 st wave, N = 2741; 2 nd wave, N = 2271 1 st wave 2 nd wave The frames indicate statistically considerable differences between the data of the 1st and the 2nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased.

15. 15 Encountered or not with corruption in the past 6 months: in view of various groups of surveyed enterprises – 2 nd wave (1) PLEASE TELL US IF A PUBLIC AUTHORITY INDUCED YOUR COMPANY TO BRIBE IN THE PAST 6 MONTHS? WHAT PUBLIC AUTHORITY WAS IT? Branch Statistically considerable differences in the performance evaluation among the corresponding group of the surveyed comparing with the analogous sampling evaluation on the whole have not been found (level of significance 90%).

16. 16 Encountered or not with corruption in the past 6 months: in view of various groups of surveyed enterprises – 2 nd wave (2) PLEASE TELL US IF A PUBLIC AUTHORITY INDUCED YOUR COMPANY TO BRIBE IN THE PAST 6 MONTHS? WHAT PUBLIC AUTHORITY WAS IT? The frames indicate statistically considerable differences in the performance evaluation among the corresponding group of the surveyed comparing with the analogous sampling evaluation on the whole (level of significance 90%). Marked green – value in the corresponding group is higher than in the sampling on the whole, marked red – lower. Oblast

17. 17 Encountered or not with corruption in the past 6 months: in view of various groups of surveyed enterprises – dynamics (1) PLEASE TELL US IF A PUBLIC AUTHORITY INDUCED YOUR COMPANY TO BRIBE IN THE PAST 6 MONTHS? WHAT PUBLIC AUTHORITY WAS IT? Branch The arrows indicate statistically considerable differences between the data of the 1st and 2nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased. 1 ST wave 2 nd wave

18. 18 Encountered or not with corruption in the past 6 months: in view of various groups of surveyed enterprises – dynamics (2) PLEASE TELL US IF A PUBLIC AUTHORITY INDUCED YOUR COMPANY TO BRIBE IN THE PAST 6 MONTHS? WHAT PUBLIC AUTHORITY WAS IT? Oblast The arrows indicate statistically considerable differences between the data of the 1st and 2nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased. 1 st wave 2 nd wave

19. 19 «Anti-rating» of the authorities – dynamics PLEASE TELL US IF A PUBLIC AUTHORITY INDUCED YOUR COMPANY TO BRIBE IN THE PAST 6 MONTHS? WHAT PUBLIC AUTHORITY WAS IT? % to all the respondents, encountered with corruption, TOP-15 of authorities * The VC principle (mutually exclusive, mutually inclusive) was not used in the classification of the authorities. The arrows indicate statistically considerable differences between the data of the 1st and 2nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased.

20. 20 ««Anti-rating» of the authorities: by branches – 2 nd wave PLEASE TELL US IF A PUBLIC AUTHORITY INDUCED YOUR COMPANY TO BRIBE IN THE PAST 6 MONTHS? WHAT PUBLIC AUTHORITY WAS IT? % to all the respondents, encountered with corruption, TOP-15 of authorities * The VC principle (mutually exclusive, mutually inclusive) was not used in the classification of the authorities / ** small benchmark for analysis The frames indicate statistically considerable differences in the performance evaluation among the corresponding group of the surveyed comparing with the analogous sampling evaluation on the whole (level of significance 90%). Marked green – value in the corresponding group is higher than in the sampling on the whole, marked red – lower.. TOTAL, N=287 AGRICULTURE, N=43 INDUSTRY, N=40 TRADE, N=73 TRANSPORT AND COMMUNICATIONS, N=13** OTHER, N=118

21. 21 «Anti-rating» of the authorities: by branches – dynamics PLEASE TELL US IF A PUBLIC AUTHORITY INDUCED YOUR COMPANY TO BRIBE IN THE PAST 6 MONTHS? WHAT PUBLIC AUTHORITY WAS IT? % to all the respondents, encountered with corruption, TOP-15 of authorities * The VC principle (mutually exclusive, mutually inclusive) was not used in the classification of the authorities / ** small benchmark for analysis TOTAL, N=377 N=287 AGRICULTURE, N=69 N=43 INDUSTRY, N=46 N=40 TRADE, N=89 N=73 TRANSPORT AND COMMUNICATIONS, N=15** N=13** OTHER, N=158 N=118 The arrows indicate statistically considerable differences between the data of the 1st and 2nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased. 1 st wave 2 nd wave

22. 22 Situations, where bribery is a common practice – dynamics (IF THE ANSWER AS TO THE BRIBERY IS POSITIVE) TELL US PLEASE WHAT AUTHORITY WAS IT? WHAT CITY? WHAT OPERATIONS WERE BEING CONDUCTED ? % to all the respondents, encountered with corruption, TOP-15 of authorities The arrows indicate statistically considerable differences between the data of the 1st and 2nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased.

23. 23 Situations, where bribery is a common practice – dynamics (IF THE ANSWER AS TO THE BRIBERY IS POSITIVE) TELL US PLEASE WHAT AUTHORITY WAS IT? WHAT CITY? WHAT OPERATIONS WERE BEING CONDUCTED ? % to all the respondents, encountered with corruption, TOP-15 of authorities 1 ST wave2 ND wave FISCAL SERVICEON EXAMINATION5,4%5,7% CUSTOMS WHILE BEARING TRANSPORTATION BURDEN / DELIVERY OF GOODS / EXPORT- IMPORT OPERATIONS -3,1% AGENCY OF LAND RESOURCESEXECUTION OF THE DOCUMENTS ON LAND / REAL ESTATE / BUILDING / LEASE3,7%3,0% FISCAL SERVICE APPROVAL DOCUMENTS ISSUING / OBTAINING A PERMIT / LICENSE / TECHNICAL CONDITIONS / CERTIFICATES / ENQUIRIES 0,7%2,1% STATE REGISTRATION SERVICEREGISTRATION / CLOSURE OF AN ENTERPRISE-1,8% FISCAL SERVICE WHILE CONDUCTING TRANSACTIONS / ORDINARY OPERATIONS / ALL THE OPERATIONS -1,8% FISCAL SERVICE EXECUTION /HARMONIZATION / ISSUING / SUBMISSION OF OTHER DOCUMENTS / EXECUTION OF CONTRACTS 0,9%1,4% FISCAL SERVICE INDUCING TO BRIBE / DELIVERING CHERTABLE PAYMENTS /PAYMENTS WITHOUT RECEPTS / PAYMENTS OF EXTRA SERVICES 1,5%1,1% REGIONAL ADMINISTRATION INDUCING TO BRIBE / DELIVERING CHERTABLE PAYMENTS /PAYMENTS WITHOUT RECEPTS / PAYMENTS OF EXTRA SERVICES 0,9%1,0% Colored data indicate statistically considerable differences between the data of the 1st and 2nd waves (level of significance 90%). Marked green – the value in the 2nd wave has increased, marked red – has decreased.

24. 24 Thank you for your attention!