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In the 2019 CPI Issued by Transparency International, Korea Received an All-Time High Score Again...
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2020-02-07
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In the 2019 CPI Issued by Transparency International, Korea Received an All-Time High Score Again in a Span of Just One Year, Breaking into the Global High 30s

- After the launch of the Moon administration, Korea’s CPI score and ranking have improved for the past three consecutive years -

- Compared to the previous year, Korea rose six notches higher from 45th to 39th, garnering two more points in the latest 2019 Corruption Perceptions Index (CPI) -

 

 

January 28, 2020

Anti-Corruption and Civil Rights Commission

The Republic of Korea

Korea came in 39th place out of 180 countries and territories with an all-time high of 59 points on a scale of 0 to 100 within a span of just one year in the latest 2019 Corruption Perceptions Index (CPI) released by the Transparency International (TI).

Compared with the previous year, Korea garnered two more points in its score, improving by six notches in its global ranking in the 2019 CPI. After the launch of the Moon Jae-in administration, Korea has improved by 13 positions in total for three consecutive years from 51st in 2017 to 45th in 2018 and to 39th in 2019, breaking into the global high 30s again nine years after it ranked 39th in 2010.

Designated as one of the three government innovation indices of the Moon administration, the Corruption Perceptions Index (CPI) published by the Transparency International is one of the most leading indices measuring the extent of corruption among public officials/politicians in countries around the world.

Recently, the international perceptions of corruption level in Korea have been steadily improving.

The international organizations, such as Political and Economic Risk Consultancy (PERC) based in Hong Kong and Bertelsmann Foundation (BF) in Germany, etc. whose assessments are used as sub-indices constructing the CPI, have made positive comments on the recent anti-corruption drive in Korea.

Asian Intelligence Review by Political and Economic Risk Consultancy (PERC) (Mar. 27, 2019)

- Official bodies tasked with fighting corruption such as the Anti-Corruption and Civil Rights Commission (ACRC) take their jobs seriously. They have been more effective in fighting bribery and other forms of graft at lower levels

Bertelsmann Foundation (BF) (Oct. 28, 2019)

- Positive institutional changes made in past years, such as the Kim Young-ran Act, are now showing results, and have effectively limited Korean traditions of gift-giving.

In the 2019 Index of Public Integrity (IPI) published by the European Research Center for Anti-Corruption and State-Building (ERCAS), Korea ranked 19th out of 117 countries, moving up by five positions compared to 2017 (biennial assessment) and 1st among Asian countries evaluated, while taking 23rd place in the list of 200 countries on TRACE Bribery Risk Matrix in 2019.

These positive changes in the international community’s perceptions of Korea, including the CPI results, seem to be driven by combined effect of the following factors: government-wide anti-corruption policy implementation, including founding the president-presided Anti-Corruption Policy Consultative Council and establishing the Private-Public Consultative Council for Transparency Society; fostering a culture of integrity and fairness, including reinforcing the protection of corruption and public interest reporters and uprooting corruption deeply related to people’s livelihoods such as hiring irregularities at public firms; legislation of the Act on the Prohibition of False Claims for Public Funds and Recovery of Illicit Profits and reinforced public subsidy management regulations; curbing hierarchical power abuse in the public and private sectors; and the concerted anti-corruption reform drive by the government and the private sector through reforming anti-corruption laws and institutions, etc. including strengthening the recovery of corruption proceedings.

In order for these positive changes to continue, not only should the public sector make efforts, but also the private sector needs to work together, because the extent of corruption in the private sector has a gradually growing impact on the assessment carried out by international organizations and on the national competitiveness, etc.

Last year, the Korean private sector scored 6.16 points on a scale of 0 (highly corrupt) to 10 (very clean) in the assessment conducted by the National Research Council for Economics, Humanities and Social Sciences as a joint research to measure the transparency level of the private sector in Korea.

This result is similar to those of the assessments done by international organizations such as the International Institute for Management Development (IMD) and World Economic Forum (WEF), etc. regarding the level of business ethics in the industrial sector in Korea, which shows the need for more concerted efforts across the public and private sector.

On the IMD’s 2018 World Competitiveness Index, Korea scored 5.63 points out of 10 on the ‘Ethical Management’ component and on the WEF’s 2017 Global Competitiveness Index, scored 3.5 points out of 7 (5 points if transformed to be in range between 1 and 10) on the ‘Ethical Behavior of Firms’ component.

In the years ahead, the ACRC will focus its capacity more on accomplishing the following anti-corruption tasks to rank among the high 20s by 2022.

First, the existing ‘Anti-Corruption Policy Consultative Council’ will be expanded and overhauled into the one dedicated to a fair society, reflecting the public aspirations for a fairer Korean society, and will have an in-depth discussion on ways to improve fairness in people’s livelihood and the economic sector alongside the anti-corruption measures so that the public can actually feel the effect thereof.

Second, the provisions on the prevention of conflicts of interest in public office, which were excluded at the time of legislation of the Improper Solicitation and Graft Act, will be enacted as a separate Act to strengthen the standard for fair performance of public duty by public officials, including those at the highest level of power. In addition, the Act on the Prohibition of False Claims for Public Funds and the Recovery of Illicit Profits will be put in force without a hitch to impose sanctions on public subsidy frauds, thereby leaving no room for the national financial leakage.

Third, a culture of fairness and integrity will be spread across all sectors of the society by concentrating the policy capacity on addressing institutionalized unfair practices in the field of employment or college admission, expanding the integrity education for public officials and the future generation, and strengthening the protection for corruption and public interest reporters.

Fourth, the government will continue to put efforts into building a better national image abroad by more systemically promoting anti-corruption policy achievements to the international analysts and business people, etc. while proposing more effective policy measures to deal with issues people are interested in, such as fairness and justice, through the public-private consultative council for transparent society and People’s Idea Box, etc.

Last but not least, the government will take the International Anti-Corruption Conference (IACC) slated to be held in June this year in Korea as the opportunity to share outstanding anti-corruption policies and achievements with other countries around the world, thereby elevating the national transparency level and taking the lead in anti-corruption initiatives in the international community.

The Chairperson Pak Un Jong of the ACRC said, “The improvement in the CPI for the third straight year can be attributed to the combined efforts from the private and public sector for the anti-corruption reform after the launch of the Moon administration. In light of Korea’s global positioning, I think that there still remains room for improvement. The ACRC, as an anti-corruption control tower, will do its best to spread the culture of integrity and fairness across the whole society in cooperation with relevant ministries and the public to continue this upward momentum.”

Attachment 1

 

An Overview of Corruption Perceptions Index (CPI)

 

<Overview of CPI>

Publisher: Transparency International (TI) based in Berlin, Germany

What is CPI? CPI is an index to measure how corrupt public/political sector of a country or a territory is perceived to be, and it is evaluated as a useful tool for arousing people’s interest in anti-corruption efforts around the globe (published since 1995)

The higher the score, the cleaner [on the scale of 0 (highly corrupt) to 100 (very clean)]

Target Countries/territories: 180 (annually updated)

Methodology: determined by the results of expert assessments and surveys of businesspeople

For Korea, 10 data from 9 sources are used to compile the index

- Executive Opinion Surveys: 3 (IMD, WEF, PERC)

- Expert Assessments: 7 (EIU, PRS, WJP, IHS Markit, BF Transformation Index & Sustainable Development Goals Index, V-Dem Institute)

Korea ranked 39th out of 180 countries and territories, scoring 59 points (equivalent to the top 21%)

Korea rose six notches higher to break into the CPI’s top 30 countries with an all-time high score (’95~) of 59 points, up two points from last year.

It is noteworthy that Korea recorded the highest-ever score of 59 points in a span of just one year since 2018 when it hit its then all-time high score, ranking in the high 30s again nine years after it ranked 39th on the CPI in 2010.

Korea ranked 27th out of 36 OECD member countries, up three notches from last year, followed by Poland, Czech Republic, Italy, and Greece, etc. (OECD average: 67.8 points)

< Korea’s CPI Scores and Rankings (2008-2019) >

The TI established the new scale of 0-100 in 2012 as an update to its methodology.

Attachment 2

 

Current Status of Individual Data Reflected into the CPI

 

(Overview) 10 data from 9 sources were used to compile the CPI for Korea

The Transparency International compiles the CPI based on the 13 data among which 10 data are used for the CPI for Korea, 9 for Japan and the U.S., and 8 for the U.K, and Germany.

(Improvement) 6 raw data from sources including IMD (world competitiveness index) and PERC (Asian Corruption Survey)

(Deterioration) 1 raw datum from WEF (Global Competitiveness Index)

(Stagnant) 3 raw data from sources including BF (Sustainable Governance Index) and IHS Markit (Country Risk Analysis)

The results of expert assessments were relatively more favorable than the survey results by the business executives, the same as last year.

<Current Status of Scores on Indicators Reflected into the 2019 CPI for Korea>

(10 raw data provided by 9 sources)

Classification of Raw Data

2018

2019

Executive Opinion Surveys

International Institute for Management Development

50

55

5

Political and Economic Risk Consultancy

42

47

5

World Economic Forum

56

54

2

Expert Assessments

Economic Intelligence Unit

55

55

-

IHS Markit

59

59

-

Bertelsmann Foundation

Sustainable Governance Index

62

62

-

Transformation Index

53

61

8

Political Risk Services

50

54

4

World Justice Project

69

72

3

V-Dem Institute

70

71

1

 

Attachment 3

 

The Scores and Rankings by Country in 2019 CPI

 

 

Attachment 4

 

An Overview of IPI and Its 2019 Result

 

<Overview of Index of Public Integrity>

Published by: European Research Centre for Anti-corruption and State-Building (ERCAS)

The research to publish the Index of Public Integrity (IPI) was conducted by the support from the EU FP7 ANTICORRP project at the Hertie School of Governance.

Background: pointing out the limits in the current anti-corruption measurement tools that are largely based on perceptions of experts or businesspeople, lacking information on corruption-causing factors and specific guideline for improvement, IPI was developed as an alternative anticorruption tool to provide a clear measure to determine status and progress of corruption control

Countries covered: 117 countries (as of 2019) biennially released since 2015

Methodology: IPI is based on either concrete data or an analysis of explicitly defined and concrete questionnaires.

Composition: institutional factors that have been proven to be strongly correlated with corruption control compose the IPI as its sub-components

 

Component

Variables, Measurement, and Sources for raw data

Judicial independence

Sourced from the sub-indicator ‘judicial independence’ of the Global Competitiveness Index of the World Economic Forum

From the Survey that asks the question “To what extent is the judiciary in your country independent from influences of members of government, citizens, or firms?

Administrative burden

Based on 4 indicators from Doing Business Dataset, World Bank

Number of procedures required to start up a business, time needed to start up a business, number of tax payments per year, and time to pay taxes

Trade openness

Based on 2 indicators from Doing Business Dataset, World Bank

Total number of documents required to export and import, and time for exporting and importing

Budget Transparency

Sourced from the open budget survey of International Budget Partnership

14 specific questions that cover transparency of the Executive’s Budget Proposal

E-Citizenship

Sourced from ICT dataset of International Telecommunication Union and the dataset of Internet World Stats

The fixed broadband subscriptions, internet users and Facebook users (% population)

Freedom of the Press

Freedom of the Press score sourced from the Freedom of the Press Dataset of the Freedom House

In the 2019 Index of Public Integrity, Korea ranked 19th out of 117 countries assessed with a score of 8.34 points (on a scale of 1 to 10 implying the least corrupt), topping the list in Asia.

(2015) 23rd (8.04 points)/109 (2017) 24th (8.02 points)/109 (2019) 19th (8.34 points)/117

The components on which Korea marked the highest and lowest score were E-Citizenship (10 points) and Judicial Independence (5.62 points)

<IPI Scores and Rankings for Korea from 2015 to 2019>

Attachment 5

 

An Overview of BRM and Its 2019 Result

 

Overview of Bribery Risk Matrix

Published by: TRACE International

TRACE is a globally recognized anti-bribery business association and leading provider of risk management solutions based in the U.S., which has 500 member multinational companies

Background: TRACE Matrix was developed to evaluate business-related bribery risk worldwide, addressing the risk that companies will be asked for bribes from public officials when doing business in countries around the world. originally developed in collaboration with the US analytical center RAND Corporation (first launched in 2014 and became stable starting from 2018)

Countries covered: 200 countries Annually released since 2016

Methodology: the matrix is based on publicly available anticorruption measurements such as Doing Business Dataset of the World Bank and the Global Competitiveness Index of the World Economic Forum, etc.

Composition: to arrive at each country’s score, the matrix analyzes four specific areas (domains) that have been identified as having a significant effect on the bribery risk environment at the national level, and uses multiple sub-indicators to derive scores for each domain (65 sub-indicators in total)

* Score is based on the following four factors: 1) Opportunity: Business Interactions with Government; 2) Deterrence: Anti-Bribery Deterrence and Enforcement; 3) Transparency: Government and Civil Service Transparency; and 4) Oversight: Capacity for Civil Society Oversight, including the role of the media

 

The 2019 Bribery Risk Matrix showed that Korea ranked 23rd out of 200 jurisdictions with a score of 24 (on a scale of 1 to 100 with 1 being the lowest risk and 100 implying the highest risk), while coming in the 3rd place following Hong Kong (10th) and Singapore (12th) in Asia.

(2017) 33rd (29 points) (2018) 25th (24 points) (2019) 23rd (24 points) /200 jurisdictions

According to the matrix, Korea belongs to the low risk group in terms of the bribery risk level

Very low (21 countries) / Low (31) / Medium (85) / High (50) / Very high (13)

Among the four specific domains, Korea fared the best in the domain of Government and Civil Service Transparency (scored 20) and the worst in the domain of Anti-Bribery Deterrence and Enforcement (scored 27).

< BRM Scores and Rankings for Korea by Assessment Domain>