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The impact of changing legislation in emerging markets

Overall, corporate executives in emerging markets have seen little significant improvement in the business environment from a fraud and corruption perspective over the last four years. In some countries there were significant changes in the perceptions of fraud and corruption. Saudi Arabia for example increased from 26% to 46%. There were also some improvements in certain emerging markets with India reducing from 67% to 40% and Romania dropping from 46% to 34%.

Bribery and corruption


An increasingly important factor that multinationals operating in emerging markets should be addressing is the introduction, and more rigorous enforcement, of local anti-corruption legislation.

From a legal perspective, most countries of the world, including many in emerging markets, have had anti-corruption embedded into their domestic legislation for many years. A number have signed the UN Convention against Corruption; many have also signed the Organization for Economic Co-operation and Development (OECD) Anti-Bribery Convention.

Many emerging markets have strengthened their enforcement regimes. China’s all-embracing anti-corruption campaign has been well publicized, but there are other examples of governments making anti-corruption activities a priority. This includes Korea (the Kim Young-ran Law, 2016) and India (Prevention of Corruption (Amendement) Act, 2018 and Fugitive Economic Offenders Bill, 2018), and the countries in Eastern Europe and Central Asia. More importantly, these nations have started to enforce these statutes with more rigor than ever before. This has led to some high-profile cases that have seen prominent business leaders prosecuted, and even heads of state impeached and removed from office.

While there continues to be a high volume of prosecutions from the U.S. Department of Justice under the FCPA, domestic efforts to combat bribery and corruption are also being reinforced by growing cross-border cooperation through bodies such as the SEC, G20 and the OECD. Other examples of cross-border initiatives include extraterritorial legislation, such as France’s Sapin II.


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