Oct. 18 (Bloomberg) -- Chinese companies ranked the lowest in a survey of public reporting practices in emerging markets, underscoring concern that the government’s anti-corruption campaign may not take root in the corporate sector.
The 33 Chinese multinationals surveyed averaged a score of 2 out of 10 points in Berlin-based Transparency International’s “Transparency in Corporate Reporting” survey, released yesterday. Chery Automobile Co., the closely held carmaker based in Wuhu, China, joined one other company among the 100 surveyed with a score of zero across the three categories measured.
The report draws attention to a Chinese business environment that’s ripe for corruption because of minimal public-reporting requirements. Leaders of the ruling Communist Party have warned that corruption threatens their grip on power and have announced anti-graft investigations of a number of officials in recent months.
“Results show that companies from China lag behind in every dimension,” Transparency International said in the report. “Considering their growing influence in markets around the world, this poor performance is of concern.”
Companies from India fared the best, with Tata Communications Ltd. leading the list with a score of 7.1. Tata Global Beverages Ltd. and Tata Steel Ltd. were second and third. Lenovo Group Ltd. was the highest ranking Chinese company at 19.
Angela Lee, a Beijing-based spokeswoman for Lenovo, didn’t immediately reply to an e-mailed request for comment.
The study measured three categories: reporting on anti-corruption programs, organizational transparency and country-by-country reporting of revenue, expenses and tax payments.
Transparency International urged emerging-market companies to disclose their anti-corruption measures and government connections. It said 60 percent of those surveyed didn’t disclose information about political contributions.
Indian companies performed well thanks to laws that require them to publish key financial information about their subsidiaries, according to the report. Seventy-five of the companies surveyed were from BRICS nations -- Brazil, Russia, India, China and South Africa.
Eight of the 10 lowest ranking companies on the list were Chinese, including China National Chemical Corp. and China Shipbuilding Industry Corp. Along with Chery, Mexico’s Controladora Mabe SA scored zero points.
“With the notable exception of the Indian companies, most emerging market companies in the sample are still a very long way from disclosing financial data across all countries of operations,” Transparency International said.
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