"It looks ridiculous that a permanent member of the Security Council is running around the world and buying support off tiny Pacific nation states.
"The biggest concern is that the whole system of international relations is corrupted by Russia and recognition and votes are becoming merchandise to sell," he said.
Nauru has recognised the Russian-backed territories of South Ossetia and Abkharzia, which declared independence in 2008, sparking war between Russia and Georgia.
It reportedly received US$50 million ($66 million) in aid from Russia.
Vanuatu did the same, then reversed its decision, and is now thought to be reconsidering it.
And 10 days ago Tuvalu Prime Minister Willy Telavi flew to South Ossetia to sign a recognition pact. That makes five countries to recognise the area: Russia, Venezuela, Nicaragua, Nauru and Tuvalu.
Mr McCully said his Georgian counterpart had raised the matter with him at least half a dozen times.
"We are obviously strong supporters of the concept of transparency in development funding and so we do say to Pacific nations particularly where there are assertions of this sort that it is very much in all of our interests to have transparency.
"It helps us with our decision-making about development funding."
Mr McCully said he had made New Zealand's views clear to the Russian Foreign Minister, Sergei Lavrov.
The Russian position was that there was no link between development support and any recognition initiatives Pacific nations undertook.
The embassy declined to comment.
