Big companies disclose too little on operations abroad: watchdog
Reuters
Published Nov 05, 2014 03:13PM ET
Big companies disclose too little on operations abroad: watchdog
By Michael Nienaber
BERLIN (Reuters) - The world's biggest companies disclose little or no financial details about their operations abroad, according to a report by Transparency International, which singled out Chinese companies but pointed to U.S. tech giants like Amazon (O:AMZN) and Google (O:GOOGL) as well.
The Berlin-based anti-corruption watchdog named Bank of China (SS:601988), Honda Motor (T:7267), Bank of Communications (SS:601328), Agricultural Bank of China (SS:601288) and Russia's Sberbank (MM:SBER) as the five least transparent companies.
Bank of China could not be reached for comment on the report. The other four companies declined to comment.
"We need more transparency from multinational companies, whose power in the world economy closely rivals the biggest countries," said Transparency International chairman Jose Ugaz.
"By not responding to people's demands for greater transparency and accountability, companies risk harming their brand and losing customers," he warned.
Around three quarters of the 124 companies assessed do not disclose the taxes they pay in foreign countries and nearly half publish no information on revenues abroad, the report said.
The companies were ranked based on their reporting of their measures to prevent corruption, information about subsidiaries and holdings and information about financial operations abroad.
By those criteria, European companies performed best. Italy's Eni (MI:ENI), Britain's Vodafone (L:VOD) and Norway's Statoil (OL:STL) were the leaders.
"We are committed to providing as much information and insight as possible to support informed public debate on issues such as corporate governance, anti-corruption programs and corporate taxation," said a spokesman for Vodafone.
While there were six Chinese companies among the 10 worst performers, U.S. corporations also figured.
Warren Buffet's conglomerate Berkshire Hathaway (N:BRKa) was ranked the sixth least transparent multinational, and the report said major tech companies also performed relatively poorly.
"Surprisingly, the sector that makes greater transparency possible is one of the least transparent," said Transparency. Amazon, Apple, Google and IBM (N:IBM) all scored less than three out of 10, the organization said.
A spokesman from IBM said the company was publishing a full list of every subsidiary and country in which it does business every year. That list was part of IBM's annual report.
The other U.S. companies cited declined to comment or were unavailable when asked for a reaction by Reuters. Some did not want to respond until they had seen the complete report.
A spokesperson for Japan's Nippon Telegraph and Telephone Corp (T:9432), which was also among the bottom 10, said: "We want to continue to work towards appropriate disclosures."
Get The News You Want
Transparency said the world's biggest oil, gas and mining companies were not yet ready for transparency rules that would enter into force across the European Union from July 2015.
Those regulations require extractive companies to report payments such as taxes to governments on a country-by-country and project-by-project basis. In the United States, similar measures are planned, but implementation has been delayed.
(Additional reporting by Engen Tham in Shanghai, Taiga Uranaka and Teppei Kasai in Tokyo and Alexander Winning in Moscow, Kate Holton in London, Marina Lopes in Washington and Christian Plumb in New York; Editing by Stephen Brown, Crispian Balmer, Larry King)
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.