The top five least risky countries in which to do business and avoid bribe demands are New Zealand, Sweden, Norway, Denmark, and Finland, according to the latest research from TRACE International.

The 2018 TRACE Bribery Risk Matrix, released Thursday, also names the most risky of the 200 countries evaluated: Somalia, Libya, Venezuela, Chad and Turkmenistan.

The least risky continent was Europe, with Africa being the most risky. TRACE is an international anti-bribery organization that provides risk management solutions to almost 400 multinational companies.

The United States ranked as No. 18, or low risk, but the U.K., Germany, Canada and Australia, among others, scored better.

In last year's matrix, the U.S. ranked at No. 17. But Alexandra Wrage, president and founder of TRACE, told Corporate Counsel that changes to the methodology this year made comparisons invalid.

“Before we were tweaking [data] around the edges,” Wrage said. “This year we put together a working group, a team of experts from around the world, who worked six months examining our assumptions on the likelihood of a bribe demand.”

The findings led TRACE to change some of the four categories and nine subcategories—TRACE calls them domains and subdomains—used to calculate the points given to countries. The four domains are opportunity, deterrence, transparency and oversight.

One key change involved adding a subdomain to deterrence, called “dissuasion.”

For example, previously the matrix team “weighted heavily whether or not a country had a serious anti-bribery law on the books,” Wrage said.

“We found that's not really meaningful,” Wrage added. “It's not what's on the books, but what is being enforced that matters. A country no longer gets points for having a rigorous law if it's just sitting there collecting dust.”

But a country can earn points for “dissuading” people from engaging in bribery. Wrage said one example is Hong Kong, an island community where the anti-bribery organization is well known “and feared by most citizens.”

She said the high level of oversight meant there was a more credible risk of misconduct being caught. Thus citizens were dissuaded from wrongdoing.

The deterrence category also includes losing points for lack of dissuasion, or what Wrage called having a culture of “corruption malaise.” That occurs, she said, in communities where people believe that “everyone does it [pays bribes].”

In another change, TRACE added e-government to the points list.

Wrage explained, “We found high levels of e-government correlates with high levels of transparency. If you are doing a government transaction entirely online, such as seeking a visa or a permit, then you never interact with a government official and there is no opportunity for a bribe demand.”

Another first-time subcategory involved adapting to an influx of immigrants. “If you are a country with a low level of corruption, you want to make sure that immigrants buy into your entire way of doing business, including low corruption,” Wrage said.

Merritt Smith, a quantitative researcher who worked on the matrix, cited Hong Kong as an example of an entity that quickly integrates immigrants and instills local values about anti-corruption.

Wrage said looking at what kind of government a country has is not part of the methodology. “There could be a horrible state run by a horrifying dictator, but if he decides to end corruption, he will have a lot of success. And if you are just measuring the likelihood of bribes, then you have to keep an open mind and be objective.”

To create the matrix the research team aggregates data obtained from leading public-interest and international organizations, including the United Nations, the World Bank and the World Economic Forum.

It then analyzes the information, and assigns each country an overall score between 1 and 100—with 100 representing the greatest risk—and also scores for each of the four domains and nine subdomains.

Wrage said the detailed information can help companies, their general counsel and chief compliance officers tailor their compliance and due diligence practices to the specific risks presented in each country and better allocate limited compliance resources.

This year TRACE launched an online data browser to help users sort the scoring data and identify patterns that may offer a better understanding of the risk each country presents to a particular company.