Islamabad Chamber conducted a Corruption Perception Survey - Presentation shows the response

1. Survey Findings
Ali Salman
Young Entrepreneurs Forum
Islamabad Chambers of Commerce and Industry

2.  Young Entrepreneurs Forum and CIPE
 Purpose of Survey
“to find the opinions of the business community on
the perceptions, manifestations, causes, effects and
remedies of corruption”
 Survey Sample and Methodology
 Structured Questionnaire , mostly close-ended
 Face to Face
 On-line
 Issues in Data Collection

3.  95 valid responses:
 services sector including professionals (35%)
 trade sector (15%)
 manufacturing (17%) and
 administrative heads of Chambers of Commerce (33%).
 Geographically
 Islamabad city (40%);
 the representatives of 35 Chambers of Commerce from across
the country did add some diversity (33%).
 Remaining 27% respondents submitted their response using
our on-line survey and they came from Karachi (16%), Lahore
(11%) and Mardan (5%).
 In terms of size, small size companies constituted 29%,
medium scale 59%, and large scale comprised 12% of
the sample.

4. Five Most Important Obstacles in Doing Business
Bangladesh India Pakistan Nepal Sri Lanka
Inadequate Inadequate Government Government Tax rates
supply of supply of instability/coup instability/coup
infrastructure infrastructure s s
Corruption Corruption Corruption Inefficient Tax regulations
government
bureaucracy
Inefficient Inefficient Policy instability Policy instability Inflation
government government
bureaucracy bureaucracy
Policy instability Tax regulations Inadequate Corruption Inefficient
supply of government
infrastructure bureaucracy
Access to Inflation Inefficient Inadequate Policy instability
financing government supply of
bureaucracy infrastructure
Source: Global Competitiveness Report 2011-12

5.  Unfair, unethical means to gain business resulting in profitability
 Illegal means of fulfilling desires
 Illegal ways to get things done; could be in monetary terms as
well as in personal favours etc.
 Using resources to get unfair advantage over others.
 Dishonest or fraudulent conduct by those in power, typically
involving bribery.
 Use of office for illicit gain
 Corruption means gaining something by means forbidden by
Allah Almighty and Islam.
 Seeking undue return for performing one's duties; unfairly
leveraging a position of power for personal gain
 When holder of an office or power gets Illegal price to bend the
rules of the game!
 Use of public/institutional resources for private gain

6.  Any acts to derail justified actions, processes or deals, to abuse
powers entrusted with an intention to achieve alternate objectives
or stop justified acts by using bribery, fraud, resources or
relationship
 Corruption is misuse of public money or authority to benefit
someone illegally
 Any kind of income which earned from illegal means utilizing
authority
 Using unethical, dishonest means to extort money.
 Deviant action is corruption either from norms or laws
 Immoral ways to attain benefits
 Any unethical means used to get more than the right which they
deserve
 Exploitation of rules and laws, unethical practice to perform ones
duty
 Getting undue benefits from your power

7. Complex and
unpredictable
regulations
and laws
100
80
60 Non
Poor
40 Competetive
standards of
20 incentive Entrepreneurs
public morality
0 structure
Chambers
Weak and Insufficient
selective law levels of fines
enforcement and penalties

8. 50%
45%
40%
35%
30%
25%
20% Entrepreneurs
15% Chambers
10%
5%
0%
Regulation is very Compliance cost is Compliance
complex high procedure is
complicated

9. Increases cost of
doing business
because of bribery
etc.
80
70
60
50 Gives unfair
40 advantage to specific
Destroys morality 30 player in a market
20
and erodes
10 Entrepreneurs
competition
0
Chambers
Controls time delays
and brings more
Weakens rule of law
efficiency in
transactions

10. Commission/kickba
ck paid to a
government official
100
80
60
40
Non-monetary 20 Birbery to an Entrepreneurs
exchanges such as 0 inspector for
gifts etc. compliance Chambers
Commission paid
to another private
sector executive

11. Under-
invoicing
100
80
60
40
20 Entrepreneurs
0
Chambers
Non-transfer
Non-payment
of charged
of duties
RGST (VAT)

12. Entrepreneurs Chambers
82%
47%
37%
16%
11%
7%
Remains Hidden/Informal Formalized/Accounted for Does not Apply (We do not
pay bribe)

13. Entrepreneurs Chambers
Most likely conduct No. %age No. %age
I’ll refrain from paying commission to
government officials for contracts
only if I know that my competitors are 20 32% 7 26%
also refraining.
I’ll refrain from paying commission to
government officials for contracts
even 7 11% 2 7%
if I know my competitors are paying
commissions.
I’ll refrain from paying commission to
government officials for contracts 36 57% 18 67%
under any circumstances.
63 100% 27 100%

14. Loss of sales due to
a denied business
opportunity
100
80
60
Ethical standards
40 Victimization by
within the company
20 government official
are enhanced Entrepreneurs
0
Chambers
Enhancement of Enhancement of
reputation among reputation among
government business
agencies community

15. Reforms in
rules and
regulations
100
80
Black-listing 60 Introduce
and public 40 competitive
defamation 20 wages and … Entrepreneurs
0
Chambers
Uniform and Prohibitively
strong high level of
enforcement… fines or …

16. No bribes
80
75
70
Work with 65 Improve their Entrepreneurs
other civil 60 systems and
society… compliance Chambers
Advocate
through
chambers …

17.  The most important message is that corruption
is viewed as a governance issue, which
includes poor law enforcement, archaic
regulations and weak internal compliance
system. Thus it calls for improving both public
administration and corporate governance.

18.  Improving internal compliance by devising
smarter and customized Codes of Corporate
Governance for SMEs;
 Advocating regulatory reforms after
identifying problematic regulations and;
 Building pressure on the state apparatus to
exercise uniform and predictable enforcement
of law