How Corruption Risks Shape Investment, Market Access, and Business Resilience

Amid Russia’s full-scale invasion, Ukrainian businesses operate under multiple layers of pressure: security-related, financial, regulatory, human capital, and reputational pressures. Companies are facing declining demand, workforce shortages, energy-related risks, limited access to capital, and high levels of uncertainty. At the same time, corruption remains one of the key systemic risks affecting not only public governance but also the day-to-day economic activity of companies.

For business, corruption is not an abstract societal problem. It is a factor that directly affects the cost of doing business, access to finance, trust among partners, the competitive environment, and a company’s ability to remain resilient.

According to the expert survey “Corruption in Ukraine 2025: Expert Views and Assessments” (1), conducted by Rating Group with the support of the National Agency on Corruption Prevention, corruption continues to be perceived as a widespread phenomenon. 65% of experts indicated that corruption is significantly widespread in Ukraine, while this figure is even higher among business representatives – 76%. At the same time, 76% of experts described corruption in business, particularly in interactions between businesses and public officials, as a serious issue for Ukraine.

These findings show that corruption continues to shape an environment in which businesses must assess not only market risks but also institutional risks. For the state, corruption means a loss of trust, ineffective governance, and weak reforms. For companies, it means higher costs, an uneven playing field, delays, exposure to pressure, reputational damage, and limited access to opportunities.

This approach is aligned with the modern international principles of business integrity. The 2026 practical guide developed by the United Nations Office on Drugs and Crime and the UN Global Compact, “An Anti-Corruption Ethics and Compliance Programme for Business: A Practical Guide,” emphasizes that corruption undermines fair markets and the trust needed for economic growth.
For companies, its consequences include legal and financial liability, reputational damage, lost opportunities, and diminished employee morale. Corruption also effectively acts as a hidden “tax” or illegal overhead cost, increasing expenses for companies and ultimately for their customers (2).

This is why anti-corruption compliance should no longer be viewed as a formal requirement or a narrow legal function, but as part of a company’s business resilience strategy. Integrity is becoming a source of competitive advantage: it helps companies reduce risks, build trust, attract financing, work with international partners, and meet the requirements of the European market.

Corruption as a Hidden Cost of Doing Business

Corruption increases the cost of doing business in several ways. First, it creates direct costs – informal payments, additional “intermediary” expenses, payments to accelerate procedures or obtain access to decisions. Second, it creates indirect costs: delays, administrative uncertainty, the need for additional legal support, the risk of inspections, loss of management time, difficulty in planning and a higher cost of capital.

This is particularly dangerous in an environment where Ukrainian businesses are already under significant financial pressure. According to the March 2026 survey of business conditions in Ukraine, the Ukrainian Business Index stood at only 32.9 out of 100, indicating that businesses remained in the zone of negative expectations. The first two months of 2026 were difficult for most enterprises: 63.8% of companies reduced or fully suspended their operations, while the weighted average activity level amounted to only 85.9% of the level recorded in the same period of 2025 (3).

In this context, corruption pressure has a much stronger effect than it would under stable conditions. If a company is already operating with limited demand, reduced production capacity utilization, and insufficient financial reserves, any informal payments, artificial delays or selective application of rules can become a factor that undermines liquidity. This is especially important given that the average self-assessment of business financial resilience stands at 2.4 out of 5, while 49.4% of respondents assess their financial situation as critical or unstable (4).

Thus, for business, corruption becomes an additional financial burden that reduces margins, weakens the ability to invest, increases operational risks, and makes companies less resilient to external shocks.

Uneven Playing Field and Loss of Competitiveness

One of the most destructive features of corruption is that it distorts competition. In a transparent market environment, a company should compete through product quality, management efficiency, innovation, service or price. In a corrupt environment, competitive advantage may be built not on quality, but on access to informal arrangements, administrative influence or privileged information.

For responsible businesses, this creates a double burden. On the one hand, a company that follows the rules bears the costs of compliance, transparent procedures, proper documentation, taxes and controls. On the other hand, it may lose out to competitors that obtain contracts, permits, inspections or decisions through informal mechanisms.

Expert assessments confirm that the sectors most vulnerable to corruption are precisely those that have a significant impact on the business environment. Among the sectors with the highest perceived levels of corruption, experts identified customs with a score of 4.4 out of 5, construction and infrastructure with 4.3, security and defence with 4.2, management of state-owned assets with 4.1, as well as energy, land relations, and public procurement with 4.0 each (5).

This means that corruption risks are concentrated in areas where decisions are made about access to resources, contracts, infrastructure, permits, assets, and public funds. For business, this creates a situation in which the predictability of rules becomes no less important than market demand. If a company cannot be confident that procedures will be applied equally to all, it limits investment, avoids long-term commitments, and factors additional risks into its decisions.

Integrity and Access to Finance

Access to finance is one of the key factors for business recovery. However, in an environment of high corruption risks, financing becomes more expensive and more difficult to obtain. For banks, investors, international financial institutions and donors, corruption risks mean a higher probability of misuse of funds, sanctions risks, reputational damage, violations of procurement procedures or issues with counterparties.

When businesses operate in an environment of policy uncertainty, and limited access to capital, the quality of governance practices becomes a way to reduce perceived risk in the eyes of financial partners. A company with a transparent ownership structure, clear procurement procedures, an anti-corruption policy, conflict-of-interest management mechanisms, counterparty due diligence, and reporting channels appears less risky to a creditor or investor.

For an investor, corporate integrity means a lower risk profile. The presence of an anti-corruption programme, transparent ownership structure, due diligence procedures, and controlled procurement processes does not guarantee the absence of risks, but it reduces uncertainty. Lower uncertainty, in turn, means greater willingness to provide financing, a lower risk premium and greater trust in the company’s management policy uncertainty.

International research provides further support for these findings. A U4/Transparency International review on the relationship between business integrity and commercial success notes that detected corruption may lead to legal sanctions, loss of trust among shareholders and investors, restricted access to capital, reputational damage, and reduced employee morale. At the same time, stronger business integrity practices are associated with fewer corruption incidents, lower compliance risks, and lower operating costs (6).

For Ukrainian businesses, this is particularly important in the context of future reconstruction.
A significant share of recovery financing will be linked to requirements for transparency, accountability, proper use of funds, procurement integrity, and counterparty checks. Companies that cannot demonstrate their integrity risk losing not only their reputation but also access to concrete opportunities.

A practical example of such consequences is the case of AtkinsRéalis, formerly SNC-Lavalin. Following corruption allegations in the Padma Bridge case, the company agreed to a 10-year debarment from projects financed by the World Bank Group. This period was later reduced to eight years due to the company’s cooperation and improvements to its integrity programme. The case demonstrates that corruption scandals can restrict a company’s access to internationally financed projects for years, while also showing that strengthening a compliance system can be part of rebuilding trust (7).

This is why anti-corruption compliance is gradually moving from the category of an “internal policy” to that of a company’s market capability. It affects a company’s due diligence profile, in practical terms, the extent to which it is understandable, verifiable and acceptable to banks, donors, investors, and international partners.

International Partners and Supply Chains

Corruption risks increasingly affect companies’ ability to work with international partners. For foreign companies, donors, investors and large corporations, cooperation with Ukrainian partners involves not only commercial assessment but also the assessment of compliance risks. The question is no longer only whether a company can properly perform a contract. The question is also whether it can demonstrate that it operates transparently, does not pose sanctions, corruption or reputational risks, and is able to control its suppliers.

For companies integrated into international supply chains, anti-corruption compliance becomes part of market access. Partners may require evidence of policies, procedures, beneficial ownership checks, ownership structure, conflicts of interest, and the history of legal or reputational risks. The absence of such procedures does not necessarily mean that a violation has occurred, but it creates uncertainty for an international partner. And uncertainty in compliance often leads to a refusal to cooperate or to additional conditions.

In this context, it is important that the transformational governance approach presented in “An Anti-Corruption Ethics and Compliance Programme for Business: A Practical Guide,” mentioned above, views anti-corruption programmes as part of an integrated corporate governance and sustainability strategy. Companies should act not only in accordance with the law but also in accordance with what is right; anti-corruption ethics and compliance should be integrated into the broader governance and sustainability system (2).

This means that for international cooperation, having a formal policy “on paper” is no longer enough. Practical mechanisms are needed: regular risk assessment, staff training, documentation of decisions, transparent procurement, partner checks, internal reporting channels, response to violations, and leadership involvement in supporting a culture of integrity.

Trust in a Company as an Economic Asset

In today’s business environment, trust is becoming an economic asset. It affects a company’s ability to attract financing, retain customers, work with international partners, participate in tenders, hire staff, and build long-term relationships. Corruption, by contrast, destroys this trust.

Reputational damage caused by corruption risks can be no less dangerous than legal consequences. Even a suspicion of opacity, links to political influence, unethical procurement or questionable counterparties can limit a company’s opportunities. This is particularly relevant for companies operating in sectors subject to increased attention from international partners: infrastructure, energy, construction, defence, public procurement, reconstruction, and management of state-owned assets.

Integrity is no longer viewed as a standalone issue. It is closely linked to transparent governance, responsible use of technology, human rights, inclusion, environmental responsibility, and the broader sustainability agenda (2).

For Ukrainian companies, this means that anti-corruption compliance should be part of a company’s governance profile. When a company demonstrates transparency, accountability, a clear decision-making system, and the ability to manage risks, it builds trust. And trust translates into practical advantages: lower transaction costs, easier access to partnerships, greater investor willingness to cooperate, and a stronger negotiating position.

Vulnerability to Pressure and Opaque Arrangements

Corruption makes businesses vulnerable. A company that agrees to operate through informal arrangements effectively loses part of its autonomy. It becomes dependent on intermediaries, officials, informal channels of influence or “arrangements” that cannot be protected through legal mechanisms.
This vulnerability takes several forms. First, a business may be drawn into repeated informal payments, as one precedent creates an expectation of future “cooperation.” Second, a company becomes less able to defend itself in cases of pressure because it already has a risky history of interaction. Third, opaque arrangements create internal risks: employees may start to perceive violations as an acceptable part of business processes.

The practical purpose of anti-corruption compliance is to reduce this vulnerability. Preventing corruption requires a deep understanding of the specific risks faced by a company, and the design of an anti-corruption programme should be based on thorough and regular risk assessment. Such an assessment makes it possible to identify vulnerable processes, define priority response measures, and integrate anti-corruption compliance into the company’s overall management system (2).

For Ukrainian businesses, this may involve very practical measures: documenting contacts with public officials, establishing transparent rules on gifts and hospitality, checking counterparties, segregating duties, implementing internal procurement controls, establishing mechanisms for reporting pressure or improper demands, training employees, and ensuring a clear leadership position on the unacceptability of corrupt practices.

The Role of Leadership and Corporate Culture

An anti-corruption system does not work effectively if it exists only as a set of documents. Its real strength depends on corporate culture and leadership behaviour. If managers declare zero tolerance for corruption while rewarding employees only for financial results without considering how those results were achieved, the company creates conflicting internal signals.

The authors of “An Anti-Corruption Ethics and Compliance Programme for Business: A Practical Guide” (2) shift the focus from the traditional “tone from the top” to the broader concept of ethical leadership. This means that leadership should not only formally support compliance, but also demonstrate ethical behaviour, take responsibility for a culture of integrity, provide resources for the anti-corruption programme and make it part of management decisions.

For Ukrainian companies, this is particularly important because, in times of war and crisis, many decisions are made quickly, under pressure, and in conditions of high uncertainty. It is precisely in such periods that a culture of integrity is truly tested. When employees see that leadership is ready to reject a questionable opportunity for the sake of long-term reputation, this creates a stronger internal standard of behaviour than any formal policy.

How Business Can Influence the Broader Anti-Corruption Environment

Business is not a passive actor in shaping the anti-corruption environment. It can influence the situation through its own standards, market behaviour, collective action, and public-private dialogue.

First, companies can change practices within their own organizations: adopt codes of ethics, anti-corruption policies, conflict-of-interest management procedures, counterparty due diligence, transparent procurement, internal reporting channels, and regular training. This builds internal resilience and reduces room for corrupt decisions.

Second, companies can influence partners and supply chains. When large businesses, donors, banks or international partners require transparent procedures from suppliers, this gradually raises standards across the entire market.

Third, businesses can act collectively. Ukraine’s experience with Anti-Corruption Collective Action shows that collective action can engage businesses in fostering a culture of intolerance towards corruption, promote dialogue between business, the state and civil society, improve the investment climate, and bring strategic partners into concrete action.

Collective anti-corruption action is an important element of transformational governance. It emerges when the private sector, public sector, civil society, academia, and youth jointly develop solutions for sustainable prevention and counteraction of corruption. This approach elevates anti-corruption compliance from a control function to a strategic capability that supports sustainable business conduct and strengthens institutional trust (2).

Fourth, businesses can support the digitalization and automation of procedures. Experts identify the automation of public services and business regulation as one of the most effective areas of anti-corruption policy for reducing corruption. Other priorities include the inevitability of liability for corruption, judicial reform, building a culture of integrity, and ensuring the independence of anti-corruption institutions.

Why Businesses Need Training in Governance and Anti-Corruption

For many companies, the challenge lies not only in recognizing the importance of integrity, but also in understanding how to embed it into everyday business processes. An anti-corruption policy should not remain a formal document. It should work through risk assessment, internal procedures, counterparty due diligence, transparent procurement, reporting channels, and responsible leadership.

Recognizing the importance of practical training for business, the UN Global Compact Network Ukraine develops and implements educational tools that help companies move from general declarations of integrity to concrete management decisions. Importantly, these products are not created in isolation, but through the engagement of experts from various fields, representatives of public authorities, businesses, professional communities, and civil society.

One such tool is the anti-corruption video course. The course was developed with the involvement of around 50 experts from different fields, including representatives of public institutions, business and the expert community, and with the participation of the Ministry of Digital Transformation of Ukraine, Diia.Business, Diia.Education, and the National Agency on Corruption Prevention.

Currently, the collective anti-corruption efforts of the UN Global Compact Network Ukraine are focused on creating a new product for business – a Governance training course within ESG 360° School. The course is currently under development and is intended to help companies better understand how proper governance, anti-corruption compliance, risk management, transparency, accountability, and work with counterparties are linked to business resilience, access to finance, partner trust, and readiness to participate in Ukraine’s transparent reconstruction. Once completed, the course will be available free of charge on the ESG 360° platform.

The value of these products for business lies not only in transferring knowledge, but also in building an understanding that anti-corruption compliance is part of competitiveness, access to finance, partner trust, and business readiness to participate in Ukraine’s transparent recovery.

Integrity as a Competitive Advantage for Ukrainian Business

Ultimately, business integrity should be viewed not as a cost, but as an investment in resilience. A company that implements anti-corruption compliance receives not only legal protection. It gains a stronger ability to operate in conditions of uncertainty, demonstrate reliability to partners, attract financing, participate in complex projects, and protect itself from pressure.

For Ukrainian businesses, this is particularly important for several reasons. First, the war has increased companies’ dependence on external financing, partnerships, government programmes, and international support. Second, Ukraine’s future reconstruction will be accompanied by increased attention to the transparency of the use of funds. Third, European integration will gradually bring Ukrainian companies closer to stricter standards of reporting, corporate governance, sustainability, and responsible business conduct.

(1) Корупція в Україні 2025: погляд та оцінки експертів. Результати експертного опитування від Rating Group, НАЗК, ОБСЄ- https://nazk.gov.ua/pdfjs/?file=/wp-content/uploads/Pages/19/11/191106999cc597d254383b00266e3aeedf3a82ca945072c4a49d17862e446af81545261.pdf 

(2) UNODC and UN Global Compact  “AN ANTI- CORRUPTION ETHICS AND COMPLIANCE PROGRAMME FOR BUSINESS: A PRACTICAL GUIDE” – https://businessintegrity.unodc.org/bip/uploads/documents/resources/An_Anti-Corruption_Ethics_and_Compliance_Programme_for_Business-_A_Practical_Guide.pdf

(3) Результати дослідження стану бізнесу в Україні у березні 2026 року. Опитування проводилось у період з 03.03.2026 – 24.03.2026. Усього опитано 514 респондентів – власників та керівників ММСБ. – https://business.diia.gov.ua/analytics/research/rezultaty-doslidzhennia-stanu-biznesu-v-ukraini-u-berezni-2026-roku 

(4) Результати дослідження стану бізнесу в Україні у березні 2026 року. Опитування проводилось у період з 03.03.2026 – 24.03.2026. Усього опитано 514 респондентів – власників та керівників ММСБ. – https://business.diia.gov.ua/analytics/research/rezultaty-doslidzhennia-stanu-biznesu-v-ukraini-u-berezni-2026-roku

 (5) Корупція в Україні 2025: погляд та оцінки експертів. Результати експертного опитування від Rating Group, НАЗК, ОБСЄ- https://nazk.gov.ua/pdfjs/?file=/wp-content/uploads/Pages/19/11/191106999cc597d254383b00266e3aeedf3a82ca945072c4a49d17862e446af81545261.pdf 

(6) The relationship between business integrity and commercial success- https://knowledgehub.transparency.org/helpdesk/the-relationship-between-business-integrity-and-commercial-success-1 

(7) Partnerships for Anticorruption Global Forum 2025, International Bank for Reconstruction and Development / The World Bank – https://documents1.worldbank.org/curated/en/099626111102541840/pdf/IDU-2167ccf5-3a51-4522-9996-02f96b3f0f5f.pdf

Share news: