Corruption Perceptions Index

Transparency International

To provide data on ‘corruption in international business transactions’

Combination of public, private sector and foundations

The index is used by a wide range of agencies as a measure of corruption. The results are widely publicised each year, making front page headlines in many countries. Some donors also use the index within their allocation models.

1. Freedom House – Nations in transit
2. Economist Intelligence Unit
3. Price Waterhouse Coopers – The Opacity Index
4. Institute for Management Development, Lausanne
5. Political and Economic Risk Consultancy
6. World Business Environment Survey (World Bank)
7. World Economic Forum
8. State Capacity Survey – Columbia University
9. Gallup International on behalf of TI
10. A Multilateral Development Bank
11. Business Environment and Enterprise Performance Survey
12. World Markets Research Centre
13. Information International

The key criterion for a data source to be used is that it must provide for a ranking of nations. This means methodological comparability across countries for any one input source.

It is a composite index, drawing on 12 polls and surveys from 9 independent institutions, which gathered the opinions of business people and country analysts.

163 countries globally.

In addition to Transparency International’s website, further information on methodology can be obtained from: Dr Johann Graf Lambsdorff (TI Adviser and director of the statistical work on the CPI). Passau University, Germany, Tel: +49-851-5092551.

Details of the questions asked by each of the data sources are available in the background paper on the website, released at the same time as the index. The base assumption used is that overall levels of corruption globally are unchanged from year to year. All data sources ask qualitative questions to determine the level of corruption. Note that some data sources (Economist Intelligence Unit, Freedom House) use exclusively external assessors based outside the country rated.

The scale runs from 0 to 10.0 with 10.0 being ‘highly clean’ and 0 being ‘highly corrupt’.

This measure will be influential in the ability of countries to attract foreign investment. Its purpose is to measure corruption in international business transactions. Many sources concentrate on occasions when corruption occurs whilst doing business – such as obtaining export permits. The questions in the global competitiveness report ask about the need to make undocumented extra payments in connection with public utilities. This particular question will become less relevant as states step out of providing utilities.

This cannot be used as a measure of national performance in combating corruption. This is because countries themselves cannot change their rating. The index is about relative positions. If all countries combated corruption to the same extent, under the basic methodological assumption used, countries would retain the same score.

The table below shows the 2006 top 5 ’clean countries’ together with the 5 ‘most corrupt’ countries indicated in the Corruption Perception Index.