China, Russia and US: whose corporations are most transparent?

By Victoria Bird|July 28, 2014|Economics, Financial and Management Studies|0 comments

In an interesting report, Arachnys claim that China and Russia both have greater transparency and accountability than the United States. In a potential upset, Greenland (an autonomous country within the Kingdom of Denmark- usually seen as a very democratic, open and fair society), also scores poorly.

In a news article examining the Arachnys data on the website of the International Consortium of Investigative Journalists, Margot Williams highlights the complexities of tracking down corporate information in the US as the one of the main issues behind the low ranking: the existence of multiple states, each with their own rules and regulations, to say nothing of record keeping! There is also the issue of the hierarchical systems of courts at the federal and state levels, which makes tracking lawsuits more difficult than countries with simpler systems.

The Compass site is a useful survey of the current state of access to business information. But how accurately do you think it reflects the truth on the ground? Are countries such as Venezuela really more open than the US?

Untitled: photo by Jean-Michel PlancheUntitled photo by Jean-Michel Planche // powered by Fotopedia / CC BY 3.0

The analysis focuses solely on the availability of business information online, so it could be argued that an on-the-ground investigator might access good quality corporate records in many of the countries examined in the report. There is also no effort made to assess the quality of the data made available. It could be argued, that the website itself is not very transparent in this regard, although it is covered in the report. Such reports ideally should not be utilised in isolation, but in coordination with other sources, such as the World Bank’s Doing Business Report and databank to build a fuller and hopefully, more accurate picture of the country that you are examining.

This also highlights the importance of understanding what these sort of reports actually measure, rather than simply taking the results as fact. Only once you understand the methodology of the analysis does the data become truly useful and informative. Evaluation of information is a key academic skill, one which the Library can help our students to develop- there is already some help on the Develop Your Information Literacy Skills part of the Skills for Success site on Moodle, and there are also a range of books- both print and electronic- available for you to utilise.

Arachnys are experts in providing due diligence information to companies dealing in emerging markets. Their Open Compass website is a freely accessible tool compiled from selections from their main database of over 16,000 sources. Access the data here:  and the full report here. Access the ICIJ article by Margot Williams.

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