Corruption Risk in Construction and Real Estate Is Greatest
2019-04-30 09:21 Tuesday
Construction and property development are the world's most corruption-prone business sectors, according to a new report from Risk Advisory, a London-based consultancy.
The report assesses the risk of corporate corruption, naming "minor corruption" in real estate as the top problem in Latin America, North America and Asia.
In the United States, the report said, "the licensing system provides unscrupulous companies with incentives to profit through corruption and local officials with the opportunity to peddle influence in exchange for improper incentives."
In Canada, "the Rizzuto family, the native Italian Mafia of Quebec, remains active in the construction industry and crime in eastern Canada."
While corruption in real estate and development is high in Europe and Africa, infrastructure is more vulnerable to corruption, while construction and banking are most at risk in eastern Europe and Russia, the report said.
New Zealand consistently ranked as the least corrupt and most transparent country in the report. Turkmenistan, because of its opacity, is ranked as the most challenging place to do business.
Other risky sectors include energy, banking and finance, the report said. Companies that try to minimize the risk of corruption should "know your market and your partners", the report's authors said.
Of course, companies face more compliance problems in some external jurisdictions than others. For example, the threat of corruption has increased in Turkmenistan, Libya, Somalia, Yemen, Central African Republic and the Democratic Republic of Congo.