8. Unlisted emerging market companies and state-owned enterprises should improve their disclosure practices. Unlisted companies and state-owned enterprises are subject to fewer mandatory reporting requirements. Consequently, their levels of transparency tend to be lower. Privately held and state-owned companies from emerging markets should recognise the importance of transparency and accountability in building confidence among stakeholders and strive to improve their disclosure practices.
TO INTERNATIONAL FINANCIAL INSTITUTIONS 1. International Financial Institutions should consider the adoption of robust anti-corruption programme requirements. As recommended by the B20 business leaders to G20 governments in 2013, international financial institutions such as the World Bank and regional developments banks should be encouraged to make their loans, investments, guarantees and provision of other funding conditional on the beneficiaries of their financing having in place effective internal controls, ethical standards, and compliance and anticorruption programmes.17
TO GOVERNMENTS AND REGULATORY BODIES 1. National governments in emerging markets should consider adopting rules for mandatory company reporting on anti-corruption measures. Currently most company reporting on anti-corruption programmes is carried out on a voluntary basis. In April 2013, the European Commission announced a proposal that would require European companies with more than 500 employees to be more transparent about their efforts to combat corruption and bribery. Governments in emerging markets should follow suit by passing legislation making anti-corruption reporting mandatory.
2. National governments in emerging markets should require companies under their jurisdiction to disclose all subsidiaries, affiliates, joint ventures and other related entities. Most laws and regulations applying to publicly listed companies limit disclosure of holdings to material investments. This standard, although it provides a starting point for improved transparency, often results in limited disclosure and can lead to the omission of many group holdings. An exhaustive list of related entities for each multinational company should be publicly available: if not in an annual report, then as a separate document accessible on the corporate website. Such lists should include each entity’s name, the group’s ownership interest, and the countries of incorporation and operation. This information is a necessary precondition to enable the monitoring of financial flows into and from countries. Transparency International encourages national regulators to impose higher standards of transparency and require the publication of detailed information
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Transparency International