Industry Commentary

New Corruption Perceptions Index Sobering for Offshore BPO Delivery

By January 27, 2017September 7th, 2021No Comments

This week’s publication of Transparency International’s 2016 Corruption Perceptions Index will certainly raise eyebrows among BPO decision-makers and enterprise procurement officers.  With so many firms looking to mitigate risk, a poor score in this annual analysis could negatively impact investment for countries aiming to build their outsourcing sectors. However, enterprise executives should not necessarily forego countries with poor ratings in this year’s study.  Rather, by partnering with an outsourcer that has relevant on-the-ground experience in such locations can help firms mitigate risk, take advantage of lower costs and provide high-quality customer experience.

European delivery points well-positioned from a transparency perspective

Outsourcers based in most western and central European locations can rest easy when it comes to the 2016 Corruption Perceptions Index.  For example, the Baltics, Poland and the Czech Republic were all ranked among the global top fifty performers, as was Portugal (which has emerged of late as a multilingual alternative for many outsourcers).  The ranking for Ireland was especially positive as it was the only offshore contact center location to be included in the Index’s top twenty.

Transparency challenges pronounced in emerging, established offshore destinations

Enterprise executives will almost certainly be concerned by the number of countries associated with offshore contact center delivery that fared poorly in the recently released rankings.  While some locations changed little in their respective standings (notably Hungary, Romania, South Africa, the Philippines and India), others faced significant downgrades.  These include El Salvador (which fell from 72nd in 2015 to 95th in 2016), Egypt (a fall from 88th in 2015 to 108th in 2016) and Mexico (95th in 2015, dropping to 123rd in 2016).  As these are countries in which there is significant established BPO presence, both local investment agencies and public authorities will be under pressure to reverse these downward-trending numbers.

BPOs need to tout their risk-management capabilities for uncertain enterprises

Despite the concerning transparency rankings discussed for many of the countries above, some perspective is necessary.  In many locations in which corruption concerns have been present for years, contact center outsourcers have helped clients reduce such risks by hiring teams of locally-savvy executives that help mitigate as many of these worries as possible, thereby minimizing client exposure.  By choosing the right outsourcing partner that understands how best to avoid nefarious practices in destinations where this is a problem, firms across industries will be positioned to leverage lower cost, high quality talent with a lesser degree of risk.

Efforts needed to eliminate corruption

Notwithstanding, efforts must be made to reduce corruption as much as possible in countries associated with offshore outsourcing. Vendors need to encourage such initiatives by engaging with the relevant local public authorities, including both elected officials and law enforcement agencies, to make this happen. With the BPO sector playing a significant role in inward investment and job creation in so many economies, outsourcers carry a great deal of weight and are likely to be taken seriously by policy-makers.  No matter the location, corruption impacts everyone negatively, and over the long term all stakeholders need to do their part to stamp it out.