On the day of the report's release, Delano's sister publication Paperjam reached out to Transparency International for a comment and has since followed up on that. A response has not been received at the time of writing. (Photo: Shutterstock)

On the day of the report's release, Delano's sister publication Paperjam reached out to Transparency International for a comment and has since followed up on that. A response has not been received at the time of writing. (Photo: Shutterstock)

Our Paperjam colleague Thierry Labro takes a look at the methods used by corruption watchdog Transparency International in its annual report, which says that Luxembourg is losing ground in its fight against corruption, despite the grand duchy's score improving since 2012 .

Luxembourg is mentioned once in the annual report of the Transparency International (TI), published on Tuesday, 25 January. "Since 2012, Luxembourg (81), Poland (56), Cyprus (53) and Hungary (43) have fallen significantly on the corruption perception index," indicates the watchdog's assessment.

In 2012, Luxembourg had a received a score of 80 while the country now occupies ninth place worldwide alongside Germany, scoring 81. In Transparency International's ranking the closer the score is to 100, the more exemplary the country is considered to be.

On the day of the report's release, Delano's sister publication Paperjam reached out to Transparency International for a comment and has since followed up on that. A response has not been received at the time of writing.

The score is established in several stages: up to 13 sources--7 for Luxembourg--give a first score from 0 to 100 that Transparency International takes into account to establish the final score, calculating a standard deviation per source.

For 2020, for example, according to the official report, the scores ranged from 77.53 to 82.47. The ratings of the Economist Intelligence Unit Country Ranking (72), the Global Insight Country Risk Rating (83), the IMD World Competitiveness Yearbook (84), the PRS International Country Risk Guide (85), the Varieties of Democracy Project (73) or even the World Economic Forum (86) are not in the range mentioned above.

It is also possible to question the rating of each of these seven organisations and their link to the fight against corruption or their link to a specific country. For example, the IMD World Competitiveness report on Luxembourg is produced by the Chamber of Commerce.

Investment funds and the BPR

The sub-reports published by Transparency International alongside its report include another mention of Luxembourg in a document titled .

“And as the 2021 OpenLux investigations showed, secretive financial vehicles such as investment funds based in Luxembourg (81) remain available to individuals wishing to evade corruption and human rights sanctions,” states the sub-report.

This comment refers to another of the organisation's publications, from February 2021, according to which 81% of the 16,777 investment funds had not declared any beneficial owners to the Luxembourg register. Comparing the US and Luxembourg registers, the authors of the study point out that only 16% of the 112 funds that had fewer than four beneficial owners had declared the one beneficial owner with more than 25% of the fund's shares to the RBE (register of beneficial owners), casting doubt on the completeness of the register.

No country record

The only way, at this stage, to understand the calculations on Luxembourg is to go to the country's sheet. Except that there is none.

On that page are two other figures: 19% of Luxembourgers think that corruption has increased in 2020 and 2% of public service users say they have paid a bribe.

Of the 19%, regarding opinions of Luxembourg's state of corruption 4% say that corruption has increased a lot and 15% think it has increased a little, which amounts to 95 of the 500 people surveyed by TNS Ilres in this context.

“The past year has seen a proliferation of disturbing examples: human rights defenders have been killed, media outlets have been closed down, government spying scandals have broken out, such as the Pegasus project. Increasingly, rights in general and checks and balances on power are being undermined, not only in countries with systemic corruption and weak institutions, but also in established democracies. Yet respect for human rights is essential to curbing corruption, because only citizens who are free to exercise them can act to expose injustice. The covid-19 pandemic has also been used as a pretext in many countries to restrict basic freedoms and override systems of checks and balances. And despite growing international momentum to prevent the abuse of shell and dummy companies, many countries with high scores, and thus a relatively 'healthy' public sector, continue to turn a blind eye to foreign bribery. There is an urgent need to accelerate the fight against corruption if we are to halt human rights abuses and democratic decline around the world," concludes Transparency International's report.

This story was first published in French on . It has been translated and edited for Delano.