About the SGI

FAQ

The SGI
What are the pressing reform challenges for OECD/EU countries?
The SGI project is driven by the premise that the 41 developed countries of the Organization for Economic Cooperation and Development (OECD) and European Union (EU) face a range of challenges in the 21st century.

Challenges related to globalization, digitalizaton, shifting demographics, climate change and new security risks demand actions that go beyond national boundaries.

At the same time, countries face their own individual challenges, which must also be resolved. Despite the pressures of internationalization and economic and political integration, industrialized countries still face internal social and economic challenges requiring domestic policy interventions. These include structural and financial weaknesses associated with states’ social security systems, issues of social justice, shortcomings in education systems, integration problems and unsustainable environmental degradation. These are closely accompanied by worrisome secondary challenges such as growing citizen dissatisfaction with government, fueled by rising distrust of democratic institutions and the structures of advanced market economies.
 
Which time periods do the SGI cover?
The most recent Sustainable Governance Indicators assess the period beginning November 2017 and ending November 2018. Previous review periods are also available on this website and demonstrate trends.

The SGI 2018 assessed a period ranging from November 2016 to November 2017. The SGI 2017 assessed a period ranging from November 2015 to November 2016. The SGI 2016 assessed a period ranging from November 2014 to November 2015. The SGI 2015 assessed a period ranging from May 2013 to November 2014. The SGI 2014 examined developments in the respective countries between May 2011 and May 2013. The SGI 2011 assessed a period ranging from May 2008 to April 2010. The period under review for the SGI 2009 ranged from January 2005 to March 2007.

In order to ensure comparability between the review periods, experts were asked to exclusively focus on developments within the period under investigation. Therefore, more recent developments are not incorporated into the findings. The SGI will be updated every year now.
 
Who administers the project?
The Sustainable Governance Indicators are administered by the Bertelsmann Stiftung. Working together with partners from all areas of society, the Stiftung aims to identify social problems and challenges at an early stage and develop exemplary solutions to address them.

Within the Stiftung, the SGI project is managed by Dr. Christof Schiller, Dr. Thorsten Hellmann and Pia Paulini.
Innovative principles
How do the SGI stand out in international comparison?
On four points, the approach of the SGI goes beyond other international rankings:

1. The capacity for government reform, one of the pillars of the SGI, has largely been neglected in previous international rankings.

2. In the SGI, the need for reform is examined not only in terms of economic outcomes. Instead, similar weight is also given to social and environmental policies. Thus, the SGI offer a comprehensive assessment of the sustainability of the 41 OECD and EU countries.

3. The SGI relies on a combination of qualitative assessments of country experts and statistical data from official sources. This ensures that our quantitative findings are backed up by extensive qualitative analyses provided by over 100 international experts. To ensure accuracy, final scores are audited and approved by an advisory board composed of renowned scholars and practitioners.

4. No index is perfect. The SGI project strives for complete methodological transparency and welcomes feedback and suggestions. On this website we provide access to our questionnaire and country reports containing the qualitative assessments of our experts. We also provide detailed metadata for all of our quantitative indicators.
 
Why are policy performance, democratic quality and governance capacities measured?
A comprehensive assessment of sustainability must not be limited to the measurement of policy outcomes. Instead, it must also look very closely at the capacity of the responsible political actors to successfully govern.

The SGI project assesses the actual capacity of OECD and EU countries to take action and implement reforms in terms of developing, agreeing on and realizing policy. It seeks to answer the critical question of whether a state is able to identify pressing problems, develop proposals for strategic solutions and thus foster sustainable policy outcomes through effective governance.

In addition, the sustainability of policies will depend in many ways on the quality of a country’s democracy. Guaranteeing opportunities for democratic participation as well as respect for the rule of law and civil rights cultivate citizens’ confidence in the legitimacy of actions taken by political leaders.
 
Why are qualitative and quantitative assessments combined?
To operationalize and measure the concepts used in constructing the SGI, we rely on a combination of statistical data drawn from official sources as well as the qualitative assessments of country experts. Quantitative data are conformed to cross-national standards. However, such data often do not adequately cover the full meaning of a concept. Complex concepts can be measured best through the use of expert assessments that take the country-specific context into account and provide “thick” descriptions capturing the nuances of phenomena.

In this way, the combination of expert assessments and statistical indicators assumes that both types of observations have specific strengths and weaknesses, that they cannot fully substitute for each other and that neither of them is epistemologically superior to the other. Pairing “objective” quantitative data with highly context-sensitive, qualitative expert assessments delivers a high-resolution profile of policy outcomes, the quality of democracy and governance capacity.
Methodology
How are quantitative indicators standardized?
In order to ensure the comparability of quantitative and qualitative data, all quantitative indicators are standardized using a process of linear transformation onto a scale ranging from 1 to 10. On this scale, higher values indicate better results, lower values worse results for the respective country.

Standardization is achieved by adopting fixed boundary values to assure comparability over time and among various subgroups. The minimum and maximum values are calculated according to the so-called 1.5 IQR method, which was developed by Laura Seelkopf and Moritz Bubeck, University of Bremen, for the Bertelsmann Sustainable Governance Indicators (SGI) Project in 2013 (SGI Concept). The idea is to determine boundary values that are valid invariably for all SGI data waves included in a specific SGI publication, which makes it possible to compare different data waves of the indicators. Because the SGI is subject to ongoing refinement and development, these boundary values are calculated for each SGI publication anew. This approach has been chosen to take account of the addition of updated data, retrospective corrections of formerly published data, changes in indicator definitions or data sources, or the addition of new countries. This means that the boundary values calculated are the same for the indicators of all SGI waves included in the same publication, but they may change in year-to-year editions of the SGI.

The method is based on the interquartile range (IQR), the distance between the 75th and 25th percentile of each indicator. Upper and lower boundaries are calculated by adjusting the upper and lower bounds of the middle 50% of the observations by an amount equal to 1.5 times the interquartile range (1.5*IQR). We thus obtain the following minima and maxima:

Χmin = Ρ25 − 1.5 * IQR
Χmax = Ρ75 + 1.5 * IQR

where P25 denotes the 0.25 percentile (lower quartile) and P75 denotes 0.75 percentile (upper quartile). The boundaries are calculated using long-term time series for all countries included in the SGI. The use of the 1.5 IQR method has the advantage of being less dependent on distribution, and ensures that the calculation of the boundaries is not distorted by extreme singular outliers in the data.

In cases where the boundaries calculated using the 1.5 IQR method are below or above natural boundaries of the variables (e.g., 0 or 100% for the poverty rate), they are replaced with the natural boundaries.

Based on the boundaries thus derived, for each SJI wave, all observations are subsequently transformed to a 1 through 10 scale. For this purpose, preliminary scores are first calculated using a linear transformation of the raw data based on the xmin and xmax values determined as described above. The formula differs depending on the nature of the indicator:

If higher values indicate a superior result (as, for example, with the employment rate): Score = 1 + 9*(x-xmin)/(xmax-xmin)
If higher values indicate an inferior result (as, for example with the poverty rate): Score = 10 - 9*(x-xmin)/(xmax-xmin)

This transformation process ensures that for each indicator a higher score indicates a better result with respect to social justice.

As the xmin and xmax values are calculated using the 1.5 IQR method, it is possible that the calculation of the preliminary scores yields scores higher than 10 or lower than 1. In such cases, the preliminary scores are replaced with the maximum or minimum possible SJI score of 10 or 1, respectively. This means that in the final scores, values that lie outside the boundary values can no longer be distinguished.
 
How many indicators make up the SGI?
The SGI 2019 contains 71 qualitative indicators and 74 quantitative indicators, which means that the overall assessment of the 41 sample countries entailed a total of 5,945 ratings (i.e. scores). For a complete overview of the indicators, please refer to the Survey Structure.
 
How are the indices calculated?
The Policy Performance, Democracy and Governance indices scores are derived by calculating the arithmetic means of the scores for their respective categories. For example, the Policy Performance score is derived by calculating the average of the categories “Economic Policies”, “Social Policies” and “Environmental Policies”. The individual category scores are derived by calculating the arithmetic mean of the criteria scores.

For example, the “Economic Policies” score is derived by calculating the average of the criterion “Economy”, “Labor Market”, “Taxes”, “Budgets”, “Research and Innovation” and “Global Financial System”. For criterion composed exclusively of qualitative indicators, their score is the arithmetic mean of those indicators. For criterion composed of both qualitative and quantitative indicators, the scores are weighted, with fifty percent of each score coming from the arithmetic mean of the qualitative indicator(s) and fifty percent from the arithmetic mean of the quantitative indicator(s).

The three composite indices – that is, the Policy Performance, Democracy and Governance indices – provide scores and ranks for each of the 41 OECD and EU countries. The ranking is based on the score to the second decimal place. If two or more states have the same score at this level of precision, they are ranked equally.
 
How are the indices structured?
The Policy Performance, Democracy and Governance indices are structured into categories. These categories, in turn, are divided into criteria made up of a varying number of quantitative and qualitative indicators. For a complete overview of this structure, please refer to the Survey Structure.
 
How does the qualitative assessment process work?
The SGI’s expert questionnaire is designed to improve the validity and reliability of expert assessments. Assessment questions are formulated so as to elicit detailed factual evidence rather than broad – and, consequently, more subjective – appraisals. In fact, many questions ask for responses that may be cross-checked with responses to other survey questions and statistical data.

The questionnaire provides detailed explanations of each question along with four tailored response options. The detailed explanations are intended to clarify the purpose of each question, to structure the way the expert words her or his assessment and to provide a standardized framework for the production of the country reports. The experts are instructed to adapt the standardized response options to the individual context of the particular country they are evaluating and to substantiate their ratings (i.e. numerical assessment) with detailed evidence. The rating scale for each question ranges from one to 10, with one being the worst and 10 being the best. The scale is differentiated by four response options provided for each question. Although the written assessments do not allow for a direct reconstruction of the numerical ratings, they do provide an explanatory background for them.

Each OECD and EU country is examined by two leading scholars with established expertise on the respective countries. To identify subjective bias and reduce any distortion it might cause, the country experts were selected so as to represent both domestic and external views as well as the viewpoints of both political scientists and economists.

In completing the questionnaire, each country expert provides numerical ratings for all survey questions. The SGI 2019 contains 71 questions, which means that the qualitative evaluations for the 41 sample countries entailed a total of 2,911 ratings (i.e. scores). Whereas the reviewer has access to the written assessments of the first country expert, he or she cannot see the first expert’s numerical ratings, which ensures that scores are given independently.

The survey process progresses through seven procedural stages:

First, one expert writes a draft country report, assessing all questionnaire questions. Second, the other country expert reviews this report, making comments and providing alternative or complementary content. Both experts are instructed to restrict their country assessment to the review period (e.g. for the SGI 2014, the review period was May 1, 2011 through May 15, 2013).

The countries examined by the SGI are subdivided among eight regional coordinators. These coordinators, who are political scientists with both comparative and area expertise, are each responsible for four to eight of the 41 sample countries, grouped according to their geographic proximity. The regional coordinators monitor the development of the written assessments according to criteria of validity and objectivity, ensuring a fair and balanced country report. In addition, in the third procedural stage, the regional coordinators give their own numerical ratings based on those provided by the two county experts.

In the fourth procedural stage, sector experts review the report and scores provided; point to remaining inconsistencies or gaps and give advice on how to remedy them (in consultation with the country experts).

In the fifth procedural stage, the regional coordinators review their ratings collectively to ensure that comparisons are valid across the OECD and EU countries. As part of the discussions forming this review process, each regional coordinator is required to explain, defend, and if necessary, recalibrate his ratings and assessments. To make any changes agreed to during the review process more transparent, the coordinators aim to keep a calibrated score within the range of the two country experts’ ratings.

This regional coordinator review is followed, in the sixth procedural stage, by a second round of review. An advisory board composed of renowned scholars and practitioners discusses the findings and approves the final scores.

In the seventh and final procedural stage, the country reports are subjected to a rigorous editing process, in form and content. Questions that arise are checked with the coordinators and experts.
 
To what extent can the most recent SGI results be compared to previous years?
From time to time, the set of SGI indicators are carefully revised after being subject to comprehensive external and internal evaluations. As a result of this process, some indicators have been replaced by others and the composition of indices readjusted.

The SGI 2019 saw some modest changes in the composition of individual criteria for the categories “executive capacity” and “executive accountability.” The composition of the following criteria has changed slightly due to the addition of one indicator:

Criterion
Indicator added to SGI 2019 edition
Interministerial Coordination
Digitalization for Interministerial Coordination
Evidence-based Instruments
Quality of Ex-Post Evaluation
Implementation
Regulatory Enforcement
Citizens’ Participatory Competence
Open Government
Independent Supervisory Bodie
Data Protection Authority

Comparisons over time should bear this change in mind. Under “downloads” we also provide a time series which shows the values for an unchanged composition of the indicators as well as the deviation between the two data sets: SGI2019_TimeSeries.xlsx. As can be seen, the delta between the data sets is marginal. Moreover, it is still possible to track changes for the period between the SGI 2014 and SGI 2019 at the level of criteria such as strategic capacity, societal consultation, policy communication, parties and interest associations and media, where the indicator composition has remained unchanged. The time series of individual indicators is not affected by these changes.
This year’s edition also features a few other changes, including the removal of the indicator “GO gatekeeping” from the “executive capacity” category, which means it is no longer part of the criterion “interministerial coordination.” Moreover, the indicators “audit office” and “ombuds office” are no longer assigned to the criterion “legislative actors’ resources,” and are now part of the newly added criterion “independent supervisory bodies.”

While the SGI 2011 included only two indices (a Status Index and Management Index), since the SGI 2014, there have been three indices (a Policy Performance Index, Democracy Index and Governance Index). In addition, the SGI 2014 added ten further countries to the sample (Bulgaria, Croatia, Cyprus, Estonia, Israel, Latvia, Lithuania, Malta, Romania and Slovenia).
 
I want to use SGI scores for my work. Where do I get the complete data?
The set of data generated by the SGI can be accessed in its entirety and free of charge under Downloads.
 
All OECD and EU countries are democracies. Why is the quality of a state’s democracy important?
The Democracy index looks at the quality of democracy through four lenses: electoral processes, access to information, rule of law, and civil rights and political liberties. The quality of democracy and political participation in a political system are crucial to its long-term stability and capacity to perform. Indeed, this viability depends to a large extent on the levels of trust between citizens and politics. Guaranteed opportunities for democratic participation and observation, freely accessible information, rule of law and protection of civil rights are thus essential prerequisites for the legitimacy of a political system. Moreover, democratic participation and observation are essential for concrete learning and adaptation processes as well as the capacity to change. The SGI thus regard structures that ensure a high quality of democracy as necessary in achieving sustainable policy outcomes.

Since all OECD and EU member countries are democracies, the SGI’s questions focus on the quality rather than the presence of democracy. Thus, questions are designed to address whether citizens face discrimination in the electoral process, how citizens can access public information, the degree to which the media are independent and diversified, how well states protect civil rights and whether the government and administration act predictably and in accordance with the law.
 
Which states do the SGI compare?
The latest SGI compare 41 member countries of the Organization of Economic Cooperation and Development (OECD) and the European Union (EU), using OECD and EU membership as of July 2019 as a formal criterion to select states from a wider group of developed countries committed to human rights, democratic pluralism and an open market economy.
 
What if statistical data were missing for some countries?
If data is unavailable only for some reporting years, the missing value is replaced by the value of the preceding year. For example, if for a given country no data is available for the year 2012, the missing value is replaced using data for the year 2011 or, if also unavailable, data for a year further back in time are used. If no earlier data is available, data for more recent years are used. For example, if for a country no data for the year 2012 or earlier years are available, these missing values are replaced with data for the year 2013, or, if also unavailable, with data for more recent years.

If there is no data at all for a given country and for any point in the time series, the missing values are imputed using a full estimation maximum likelihood (FIML) approach. The FIML approach maximizes the sample log-likelihood function in order to estimate the regression parameters, meaning that the parameter values found would most likely produce the estimates from the sample data that is analyzed. A FIML approach presupposes that the data follow a multivariate normal distribution, and that the missing data is either missing completely at random (MCAR), indicating that “missingness” is not related to any other variable, or missing at random (MAR), indicating that it is possible to control for the factors of “missingness”.This approach was chosen for its merit of being a comprehensive, well-designed and scientifically recognized method of imputation.
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