ABOUT THE SGI

With the “Sustainable Governance Dialogue” the SGI project has recently started a new discussion series, which aims to bring together policy-makers and other experts in order to promote the exchange of experiences and insights on possible good practices in sustainable governance and political management.

The first Sustainable Governance Dialogue took place at the Bertelsmann Stiftung’s representation in Berlin addressing the topic “Political Management in Times of Crisis - Between Short-term Crisis Management and Sustainable Policy-Making”.

The recently published comparative study from the Bertelsmann Stiftung on crisis management from 2008-9 in 14 countries (for further information please follow the links on the main page) found, among other results, that many regular processes were compressed due to time pressure and often civil society groups were not actively involved in agenda-setting or policy-formulation. Moreover, an indication as to what extent the crisis management measures will prove adequate and able to rectify long-term structural deficits remains to be seen. The management of the current Euro crisis and the dramatic fiscal downturn in many countries point at similar problems. Against this background, many questions arise around the dilemma of handling short-term crisis situations on the one hand and shaping long-term, sustainable policies on the other: Were the chosen governance patterns for short-term crisis management as well as the contents of the political measures taken also sensible in terms of sustainable policy-making? Is a broader inclusion of and control by civil society needed in order to provide for the latter? Are international experiences with the crisis likely to change hitherto established patterns of political management capacities and societal participation?

The SGI project team discussed these questions with the following renowned experts: Martin Ahbe (Policy-Coordinator, Secretariat-General of the European Commission, Brussels), Rolf Alter (Director, Public Governance, OECD, Paris), Thomas Gerhardt (Head of Department, Federal Ministry of Finance), Matthias Graf von Kielmansegg (Section Leader, Federal Chancellery), Sven-Christian Kindler (Member of Budget Committee of the German Bundestag), Rolf J. Langhammer (Vice-President, Institute for World Economics, Kiel), Friedbert W. Rüb (Professor for Political Science, Humboldt University, Berlin).
Some ideas were hotly debated, e.g. whether it could be feasible to set up specific mechanisms for preventative crisis management or how to improve parliamentary control with regard to crisis management measures that have to be adopted under high time pressure.

The first SGD was appreciated by all participants, which encourages us to go ahead with this discussion format. The next SGD will take place in Brussels this autumn dealing with the current Beyond-GDP debate and its practical political implications.

 

Welcome to the club: Chile is the first South American country to make the jump into the circle of OECD states and will now be included into the new survey of the Sustainable Governance Indicators (SGI). On March 1st the new round begins! A network of around 70 internationally renowned experts will systematically assess all OECD countries in regards to sustainability, quality of democracy and strategic management capability.

The SGI methodology and indicator set has been further developed for the 2011 round. Changes to the instrument aim to make it more easily comprehendible and therefore increase its usability for policy-makers and governance researchers.
On the basis of 151 qualitative and quantitative indicators, the SGI evaluate the sustainability of political action in 15 different policy fields (from economy, labor, and education to environment, research and development), the quality of democracy and questions of strategic management capability in each of the OECD countries.

Not least in light of the global economic crisis, the new SGI round will offer important insights into the crisis susceptibility and strategies to overcome the current crisis in each of the OECD states in comparison. Keep an eye out for special studies on economic crisis management in selected advanced and emerging economies linked on this site in the weeks to come!

The new addition of Chile to the country sample also promises interesting results. Following a long process of economic growth and democratic consolidation, Chile signed an OECD accession agreement in Paris in January and its membership becomes effective after ratification by the country’s parliament. As such, the SGI will become the first ranking that offers a systematic comparison of all 31 OECD states.

 

How does one measure the quality of governance? Can one identify examples of good governance in the OECD world? These questions were focal points of a discussion panel at this year’s International Institute of Administrative Sciences (IIAS) conference in Helsinki. The Bertelsmann Stiftung’s „Sustainable Governance Indicators“ (SGI) together with the new OECD Project „Government at a Glance“ were also presented during the conference in Helsinki.

Martin Forst, Director of the „Government at a Glance“ project, opened the conference with an overview of the forthcoming OECD publication (October 2009). With „Government at Glance,“ the OECD aims to systematically collect data concerning the governmental performance of its respective member states. With around thirty indicators, the project will carefully examine governing practices, processes and institutions. Through this project the OECD wants to initiate long-term learning processes, in order to increase effectiveness and efficiency in the public sector.

Martin Brusis from the Center for Applied Policy Research (Munich) und Daniel Schraad-Tischler subsequently presented the method and results of the „Sustainable Governance Indicators 2009“. Based on 149 different indicators, the SGI measure both the need for political, economic and social reform and the strategic problem solving capacity in the thirty OECD states.

During the following discussion, Prof. Wouter van Dooren (University of Antwerp) systematically compared both approaches. In doing so, he emphasized, that both approaches are complementary and useful. While the indicators in the „Government at a Glance“ project concentrate primarily on key aspects of the „Public Management“-sector, the “Sustainable Governance Indicators” provide a detailed overview of the need for reform and reform capacity in the OECD states. In addition to the states’ governance capacity, the SGI also take into account aspects of social participation and democratic control. Van Dooren also emphasized that „a particular advantage of the SGI compared to many other international indicator projects is the full transparency of the data and results.”


 

The SGI Conference at the Hungarian Academy of Science in Budapest was centered on the Visegrád Four, consisting of Poland, the Czech Republic, Slovakia and Hungary. A number of scientists, policymakers and representatives of international organizations attended the conference to discuss the current political and economic situation of the four former socialist states and prospects for reform. Key note speaker, Prof. Dr. Lajos Bokros, former Hungarian Finance Minister and current professor at the Central European University in Budapest, opened the conference with a speech entitled “National Governance: Pre-Crisis Experiences and Challenges of the Crisis in Central and Eastern Europe.’ Bokros emphasized that despite swift stabilization within the four countries and considerable steps towards privatization and liberalization in the post-Soviet era, the political reform processes are still unsatisfactory. An obstacle, according to Bokros, is the tendency of the political elites to only ensure the preservation of their own power. Therefore, the countries have neither sustainably nor definitively reformed the political apparatus so that the commitment to a market economy could not unwind again in times of crisis.
Due to the more pronounced corruption among the political elites, there is increasing political frustration and thus, a lack of interest in politics.
Bokros emphasized, however, that these problems are not confined exclusively to the Central and Eastern regions of Europe. Southern European countries particularly, such as Italy and Greece, which are also members of both the OECD and the EU, have failed against similar challenges

Daniel-Schraad-Tischler, Andrea Kuhn and Dr. Martin Brusis from the Center for Applied Policy Research subsequently presented the theoretical framework, methodology and the central results of the Sustainable Governance Indicators (SGI) with a specific focus on Central and Eastern Europe. The SGI measures the capacity for reform and the policy performance in the 30 OECD states and was first released in February 2009. The results of the study confirmed the mediocre to poor performance of the four Visegrád countries and their low capacity for reform.

Dr. Ádám Török from the University of Pannonia in Hungary, Karoly Lotz, former Hungarian Ambassador to the OECD , Prof. Dr. Alojzy Nowak from the University of Warsaw School of Management and Dr. Pieter Vanhuysse from University of Haifa’s School of Political Science then discussed the topic ‘Beyond economy-specific policies. Key success factors for sustainable development in Central and Eastern Europe’. Dr. Vanhuysse confirmed the results of the SGI study of the CEE. He asserted that the states were able to cushion the impact of the transition by readily providing extensive social benefits and implementing a gradual reform of the labour market. Nevertheless, there still remains considerable need for improvement and public opinion about government performance reflects this statement.

While the Central and Eastern Europeans’ confidence in their country’s economic situation, health services and employment/work opportunities is ranked similarly to Western Europeans’ confidence in these indicators, there is still a bigger problem in these countries with regard to the public’s trust in the political elites.

Prof. Dr. Dr. András Inotai, Director of the Institute for World Economics in Budapest and a SGI-Board member, said in his closing remarks that it is unlikely that the countries' development would stall. “Reforms are processes. One can and should not stop them half way. It is precisely during times of financial crisis that loyal elites and governments capable of reform are essential.”

 

The quality of national governance matters – Great Britain with deficits in social affairs, education and civil rights protection

Even in times of global challenges and growing transnational interdependencies – national governments still have considerable broad scope of action. This is especially underlined by the positive example of the Nordic states, which are ranked as top performers by the “Sustainable Governance Indicators 2009” – a new ambitious study of the German Bertelsmann Foundation on policy performance and executive capacity in the OECD. The United Kingdom only achieves average results with some major deficits especially in the fields of social affairs, education and civil rights protection.

As a cross-national comparison of all 30 OECD countries assessing both their need for reform and their respective reform capacities, the SGI go far beyond existing indices. The study draws on the assessments of more than one hundred renowned international experts. SGI results show that despite the often assumed limiting effects of globalization it is still the quality of national governance that makes a difference when it comes to ensuring sustainable policy outcomes. Those countries with a good executive management performance, a sound democratic order and an effective inclusion of societal actors into policymaking processes are more successful in terms of sustainability and also in terms of social justice.

Problems of social inequality, deficits in terms of civil rights protection

During the period under review (2005-2007), Great Britain’s overall policy performance and the government’s political management capacities were average compared with other OECD countries. According to SGI experts, one of the country’s main problems refers to the question of social cohesion: “Although social welfare payments have raised incomes, the UK still has very high levels of social inequality, with little policy focus on equity”, says Leonard Novy, Head of the SGI Project at the Bertelsmann Foundation, “income gaps are widening, with the top 10 percent having seen their earnings rise by almost 60 percent from 2004 to 2007”.
Similar problems of social inequality are to be found in the domain of education: “On average, the British education system benefits above all the middle classes and is not open enough to help clever but poor children”, Novy points out. “According to our results, Britain has also no strategy for dealing with the most troublesome students and school truancy. Independent schools remain sought after by middle-class parents. There is a clear lack of opportunities for intermediate and vocational training in the United Kingdom as one in ten 16- to 18-year olds is neither in education, nor in employment or training. Thus, Britain has one of the lowest school enrollment rates of 17-year olds.”

A further result of the study raises some concern. SGI experts criticized that since 9/11 and especially since the London attacks of July 2005, the British government has changed the parameters of civil rights protection by emphasizing the protection of life over civil liberties. The 2001 Anti-Terrorism, Crime and Security Act permits the indefinite detention of foreign nationals suspected of being a threat to national security in cases where evidence is either insufficient to result in conviction or originates from wire-tapping or other unrevealed sources. Although the House of Lords ruled such detentions unlawful in 2004, the new 2005 Prevention of Terrorism Act enables the home secretary to request control orders on suspects, whether British or foreign. These can be used to prevent suspected terrorists from using the Internet, telephone or from leaving their homes.


Improved governmental steering capacity, shortcomings in institutional learning

As regards political management, the UK achieves rank 16 within the SGI’s cross-national comparison of all 30 OECD countries. On the one hand, SGI experts positively highlighted that the Blair government succeeded in improving the core governmental steering capacities by centralizing strategic, expert-advised planning capabilities and by putting a high value on cohesive communication strategies. On the other hand, the government’s attempts to mobilize broad public support by making the policy-making process more collaborative have not been utterly successful. “There are too few formal channels through which social partners and NGOs can be engaged”, says Novy, “furthermore, our results show that there is no standard mechanism in place for self-monitoring within the government. This often leads to the fact that politicians respond to events on a day-to-day basis rather than pursue considered long-term strategies”.

However, in order to tackle current challenges such as the global economic crisis, new security risks or climate change, effective long-term policy strategies aiming at sustainable governance outcomes are needed more than ever before.



 

With a keynote speech on “The Role and Relevance of the State in a Globalized World” former Canadian Prime Minister Kim Campbell opened up the SGI conference at the Brussels representation of the Free State of Bavaria to the European Union. In her address, Kim Campbell underlined that for the foreseeable future nation states will be the central actors in global politics: In view of the current global economic crisis, the relevance of national governance becomes even more obvious since in a globalized world legitimacy of political decisions and international norms can only be derived from the nation states. “Crisis can be a powerful motor for reform”, she pointed out by touching upon a central aspect of the Sustainable Governance Indicators. Campbell said that high reform capacity is crucial for national governments to ensure sustainable policy outcomes and a high level of social justice: “Especially when looking at the current crisis, generating evidence-based knowledge on good governmental practices is of very high importance. Therefore, I consider the Bertelsmann Stiftung’s new Sustainable Governance Indicators a very helpful and innovative measuring tool”, Campbell said before about 50 representatives of EU institutions and NGOs.

Subsequent to Ms Campbell’s speech, Leonard Novy and Daniel Schraad-Tischler (Bertelsmann Stiftung) as well as Martin Brusis (Center for Applied Policy Research) presented the SGI’s methodological approach and major empirical findings of the cross-national comparison of all OECD states. SGI results show that despite the often assumed limiting effects of globalization it is still the quality of national governance that makes a difference when it comes to ensuring sustainable policy results. Those countries with a good executive management performance, a sound democratic order and an effective inclusion of societal actors into policymaking processes are more successful in terms of sustainability and also in terms of social justice.

Under the heading of “Managing Reforms and Fostering Social Justice“, especially the question of how to improve the state of social justice within the OECD was subsequently discussed by a renowned international panel: Chaired by Josef Janning (Senior Director at the Bertelsmann Stiftung), the panellists were Prof. Wolfgang Merkel (Social Science Research Centre Berlin), Prof. Kees van Paridon (Erasmus University, Rotterdam), Rudi Delarue (Director at the International Labour Organisation, Brussels) and Reinhard Bütikofer (top candidate of the German Green Party for the European Parliament elections). “Social justice primarily means a fair distribution of primary goods and an equal opportunity in developing chances”, said Prof. Merkel, author of an SGI related case study on social justice in the OECD world.
Especially the Nordic countries are very successful when it comes to the question of providing social justice. “Thus, it is indeed important to learn from proven ‘good practice’ strategies and other countries’ experiences, but lasting structures of welfare state traditions and institutional path-dependencies often hamper attempts of mutual learning”, Merkel argued. In this context, Reinhard Bütikofer mentioned that “it is not only the government that must be prepared and willing to learn, but also the society as a whole”. Far-reaching reforms can only be successful if there is broad societal support and participation – a point that was also emphatically underlined by Prof. Paridon and Mr Delarue.

The conference was organized in close cooperation with the Bertelsmann Stiftung’s Brussels office.

 

The results of the SGI 2009 were presented at the conference “Sustainable Governance Indicators 2009 – Policy Performance and Executive Capacity in the OECD” on February 27, 2009, in Berlin.
In his keynote speech, Jaques Santer, former president of the European Commission, emphazised the role and relevance of national politics in a globalized and interdependent world. He underlined the matter of national politics but also called for a deeper integration of nation states in an international community to be shaped by global solidarity.

The SGI-project team – Leonard Novy, Martin Brusis, Daniel Schraad-Tischler, and Andrea Kuhn – introduced the conceptual and methodological framework of the SGI and presented an in-depth analysis of the most significant results. Special emphasis was placed on the SGI’s value as a tool for scientists and political practitioners to address major challenges such as globalization, demographic change and increasing environmental problems.

In two panel discussions with renowned academics and practitioners similarities and differences in respect to executive governance, policy performance and social justice in the OECD world were discussed against the backdrop of the SGI results.

While Werner Jann, professor for political and administrative science at the University of Potsdam, emphasized that it is particularly the quality of democracy and accountability that has a great effect on policy performance and thus on the future viability of a given state, Rolf Alter, Head of the Office of the Secretary-General of the Organisation for Economic Co-operation and Development (OECD), considered international organizations such as the OECD to be the key factor in addressing major future challenges including external shocks as the current financial crisis.

Ulrike Guérot, Head of the Berlin office of the European Council on Foreign Relations, commented on the results of the SGI-study on social justice in the OECD, presented by Helmut Wiesenthal, professor for political science at the Humboldt University in Berlin. She called for a strong European Union with own competences in the domain of social policy. While Wiesenthal stressed that social justice is not determined by the level of economic prosperity but rather by the status of democracy and thus considered Northern countries to be more equitable than the Anglo-Saxon approach, Oliver Marc Hartwich, Center for Independent Studies (Sydney), questioned the existence of different welfare state models in principle.

In his concluding remarks, Stefan Empter, Senior Director at the Bertelsmann Stiftung, argued that even in a globalized world national governments have considerable room for maneuver when it comes to formulating and implementing effective and sustainable policies. Emphasizing the SGI’s potential as a tool to identify strengths and weaknesses in the OECD world, Empter called on international scholars, experts and practitioners to contribute to the further development of the SGI.


 

Gunter Thielen, Chairman of the Executive Board, Bertelsmann Stiftung:

"The winter of 2008 demonstrated the intensity and the extent of international interactions. The increasing speed of and interconnectedness between numerous developments – social, economical and technological in nature – place enormous pressure on national governments."

Click here to watch an animatated overview over the approach and main findings.

 

Angel Gurría, OECD Secretary-General:

“In order to respond effectively and strategically to global challenges, such as the functioning of financial markets, growing social inequalities, demographic change and resource scarcity, national governments must continuously adapt and improve their strategic steering capabilities.

I am sure that the new approach taken by the SGI will foster public debate on good governance and encourage governments to further engage in peer-review mechanisms and evidence-based policymaking. As a study that addresses the diverse audience of policy makers, public service practitioners and academic researchers worldwide, the Sustainable Governance Indicators are a very useful instrument for nourishing public debate and might contribute to generating societal support for change.”
 

Berlin - A major study of 30 nations has come to the surprising conclusion that it is not rich countries which are proving best at beating poverty, but the well-governed, democratic states.

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