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Transparency in corporate reporting in Denmark

In the framework of a Campus for Transparency Project, students of the CEMS Programme at the Copenhagen Business School (CBS) conducted for Transparency International Denmark (TI-DK) a study on how large Danish companies report on subjects relative to transparency and anti-corruption. After reviewing the report, TI-DK published the report in their name.

As per the TRAC methodology, the study has focused on three main dimensions of transparency. The results show what the largest Danish companies report on their efforts of fighting against corruption. From an analysis of publicly available information on the English language websites of each company, 20 of Denmark’s largest public companies with significant international operations have been rated along the following three dimensions:

1) Their anti-corruption programme

2) The Organizational Transparency

3) Their reporting of key financial figures on a country-by-country basis

Companies were chosen based on their market value on the Copenhagen OMX as of February 14th, 2014. Furthermore, companies without international operations were excluded, along with companies that did not have their main domicile in Denmark. As a result, 4 companies were excluded, and 4 new companies were included to reach 20 in total.

The analysis was based on a questionnaire (the 2014 TRAC Codebook) containing a number of questions on every dimension, with each company being scored according to the quality and availability of publicly available information. The information used was limited to any text, links or reports available through the English portion of the companies’ websites. After an initial data collection process, the companies had 4 weeks to review their scores on each question, provide feedback or add information. Many companies exhibited active collaboration throughout the process.

The questions and results from the individual dimensions can be found in the different sections of this report, along with the overall results in Annex 5.

In 2014, the Codebook went through a number of changes, which tightened the requirements to score full points. The most prominent examples are: (1) a need to explicitly include directors in a range of policies, (2) a removal of the possibility of scoring half-a-point for several questions, and (3) the need to list all subsidiaries in the Organizational Transparency category, not just the material ones. These changes significantly impact the score for many companies, and as such, direct comparisons with former reports may be misleading.

In general, Danish companies ranked relatively high on their transparency. Although many have anti-corruption programmes and disclose parts of their organizational structure, there are various areas for improvement. No companies achieved full scores on neither the overall rating nor any individual dimension. 12 of the 20 companies scored above average, indicating that a few laggards kept the average down.

The findings in this report are relevant for all Danish companies, not just the ones included.

Anti-Corruption Programme transparency

Although most Danish companies report on several aspects of their anti-corruption programmes, there is still room for improvement. The most common drawback was a lack of reporting on training and monitoring of their anti-corruption programmes, where companies scored the lowest. However, the companies were strong at reporting concerning their commitment to comply with anti-corruption laws and stating non-tolerance for corruption.

The study was conducted only based on publicly available information. It does not represent a true assessment of the companies’ anti-corruption programmes, but only their reported strength. Furthermore, the need for information to be explicit and public led to many companies losing points, as implicit statements and assumptions did not count towards the rating.

Organizational Transparency – subsidiaries and other ownership interests

As mentioned, the criteria in this section was changed recently, going from only requiring a disclosed list of material subsidiaries, to a full list of subsidiaries and non-fully consolidated holdings in order to score a full point. Nevertheless, Danish companies performed well. The high scores were a result of most companies disclosing a full list of both fully and non-fully consolidated holdings, with ownership stake and country of incorporation included.

An important area of improvement for the future is the disclosure of countries of operations for all individual subsidiaries.

Country-by-Country reporting of key financial figures

This dimension showed the poorest results for all companies. With just three companies scoring anything above 1%, the overall results were rather disappointing. Most disclosed information seemed arbitrary chosen, and was usually limited to a few key countries. For this reason, the scoring on this dimension seems to be inversely related to the companies’ number of countries of operations.

Several companies publish financial figures by region, which did not help them to yield points, but presents an important step towards total transparency in their country- by-country reporting.

Comparison with other Scandinavian reports

In general, Danish companies achieved similar results as the ones analyzed in Sweden and Norway. The overall Danish average was slightly lower, but most of the difference can be attributed to the change in the rating system as of 2014. The companies’ poor performance in the dimension country-by-country reporting largely explains the remaining difference.

UN Global Compact

In this report we also wanted to assess the impact of a company being a signatory of the United Nations Global Compact agreement. A full 15 of the 20 companies are signatories (a total of 259 Danish business entities out of 7000 globally). An analysis of the ratings revealed that the companies who signed the initiative do in fact score higher on average, specifically on the anti-corruption programme dimension. 


To internationally operating companies

  • Companies should make their anti-corruption programmes publicly available, including detailed information. They should improve the reporting on transparency and anti-corruption by providing information on all topics of the study
  • For multinational companies, it should be standard to provide extensive information on their corporate website in at least one international language
  • To increase Organizational Transparency, multinational companies should provide a complete list of their subsidiaries as well as all non-fully consolidated holdings, such as associates, joint-ventures and other ownership interests
  • Companies should publish financial information for each country of operations
  • To increase the effectiveness of anti-corruption programmes and the fight against corruption, companies should join the United Nations Global Compact

 To the Danish government

  • A continued focus on the reporting of CSR should be upheld, along with legal requirements of explicit statements on anti-corruption policies and programmes
  • A specific focus should lie on mandating companies to disclose in which countries each of their subsidiaries operates
  • A standardized framework for reporting key financial figures on country-by-country basis should be required. This should to a greater extent be mandatory

 To investors and analysts

  • Private and institutional investors should demand that companies provide information on anti-corruption programmes, Organizational Transparency as well as country-by-country reporting and make it publicly available
  • Analyzing a company’s transparency in terms of anti-corruption measurements, organizational structures and country-by-country reporting should be an essential part of risk ratings and corporate responsibility indices
  • Accounting standards which require companies to ensure transparency in financial accounting and corporate social responsibility reporting should be established

 To civil society organizations

  • Civil society organizations should get more involved in monitoring multinational businesses which are located or operate in their respective countries
  • Civil society organizations should require governments to request higher transparency and disclosure from multinational companies and businesses
  • Through the specialization in specific areas and the formation of partnerships, civil society organizations should lobby other stakeholders with more direct interest to demand higher transparency


The full report is available here.

Author : Ines Strohm, Verena Röckl, Vladimir Popovic and Tomas Rosales

25 Nov 2014

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