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Measuring Governance and

Democracy: A Methodology

and Some Illustrations

Presented to:3rd OECD World Forum“Statistics, Knowledge and Policy” Busan, KoreaOctober 27-30, 2009

Presented by:Francesca RecanatiniSenior EconomistPREM Public Sector GovernanceWorld Bank

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Outline

Measuring Governance

A Definition

Motivation

Methodology/ies (Kaufmann- Recanatini)

Survey data

Agency-level Indicators

Disseminating Knowledge about Governance

New Actionable Governance Indicators Data

Portal

Going forward

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Governance and Corruption

The process, institutions and

customs through which the

function of governing is carried

out.

Using public office for

private gain

Governance

Corruption

• Corruption is an outcome – a consequence of weak or bad governance

• Poor delivery of services and weak investment climate are other outcomes of bad governance

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Political Governance• Political competition, broad-based political parties

• Transparency & regulation of party financing

Formal Oversight Institutions

• Independent judiciary• Legislative oversight • Independent

oversight (SAI)• Global initiatives: UN,

OECD Convention, anti-money laundering

Citizen

s/Firm

s

Citizens/Firms

Cit

izen

s/F

irm

s

Citizens/Firms

Decentralization and Local Participation• Decentralization with downward accountability

• Community Driven Development (CDD)

• Oversight by parent-teacher associations & user groups

Civil Society & Media• Free press, FOI• Civil society watchdogs

Private Sector Interface• Streamlined regulation• Extractive Industry

Transparency Initiative• Collective business

associations

Public Sector Management

• Public finance management & procurement

• Civil service meritocracy & adequate pay

• Service delivery and regulatory agencies in sectors

Good Governance has many dimensions …

Outcomes: Services,

Regulations, Corruption

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We have the tools, but not always the

opportunity

Capture

Embezzlement

Monopolies

Directed credits

Tax preferences

Procurement fraud

Patronage/nepotism

Selling legislative votes

Bribery

Campaign finance disclosure

PFM reform

Competition policy

Banking reform

Tax transparency reform

Procurement reform

Civil service reform

Right to information

Income & asset disclosures &

stolen asset recovery

While we cannot directly engage in enforcement actions or political activity,

some forms of state capture and grand corruption can be addressed

through instruments available to the Bank:

The challenge is political will and

sustainability of reforms.

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Governance

Assessment

Analysis

& use

Empirical tools & sample

Conceptual dimension

Implementation process

Use a working framework …

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Governance

Assessment

Enhanced local

capacity

Greater consensus

Knowledge for policy and/or

research

Broader awareness

Measuring governance: possible outcomes

Internet, radio

Policy dialogue

Focus groups

Workshops

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Governance diagnostic surveys - Approach

A participatory process to identify governance challenges and build local capacity

Key features:

Three surveys: households, firms and public officials

Questions focused on experience, adapted to local realities and tested in the field

Survey instruments and results validated through focus groups

Rigorous technical implementation

Local institution implements

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0% 15% 30% 45% 60% 75% 90%

% of public officials

report frequent public

funds mis-management

% of public officials

report frequent

purchase of positions

in their institutions

% public officials

report frequent cases

of corruption in public

administration

Sierra Leone(2003) Guinea(2004) Guatemala(2004) Zambia(2003)

Paraguay(2005) Mozambique(2004) Madagascar(2005)

Country Diagnostic Results

Extent of corruption, (Selected Countries „03-‟05)

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Percentage of household income spent on bribes to obtain services,

by income status (as reported by households), Sierra Leone, 2003

0% 5% 10% 15% 20%

Public health services

Public education services

Income Tax Department

Judges/Courts officials

Municipal/Dist. Councils

Surveys and Lands

percentage of household income spent on bribeshigh income

middle income

low income

Corruption increases inequality

Country Diagnostic Results

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0 10 20 30 40 50 60 70 80 90

Min. of Defence

Min. of Development

Min. of Information

Nat. Commissions

Others

Para-statals

Min. of Finance

Min. of Local Govt.

Min. of Social Welfare

Min. of Education

Min. of Justice

S.L Police

Min. of Agriculture

Min. of Health

% of Public Officials that said irregularities/(misappropriations) are frequent

Public funds are mismanaged by agency(as reported by Public Officials, Sierra Leone, 2003)

Country Diagnostic Results

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Mechanisms to participate to policy process

0

10

20

30

40

50

60

Association/NGO Direct tie to

public officials

None

Southern Northern Eastern Western

% of households reporting to use the following channel to participate

in the policy process (Sierra Leone, 2003)

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Sector Diagnostics: Innovative Features

Sector-specific focus:

Apply methodology and solutions to country and sector realities

Mixed methods:

Focus groups & In-depth Interviews

Surveys (households, businesses & civil servants)

Desk study

Project cost data

Active participation of civil society and government to

contribute to policy making process.

Close collaboration with donors‟ colleagues.

Active links to on-going sector projects

WB transport and port projects

EU transport ministry aid project

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Agency-level Indicators

Using responses from public officials

Public officials are employees of each agency

Public official’s responses are re-scale (from 0

to 100) and then aggregated by agency using

factor analysis technique

0 always meaning the lowest level of quality of

governance, corruption, access or service

performance

Governance Indicators, by agency(based public officials from 20 agencies, Guinea 2004)

Audit

Mechanisms

Enforcement of

Rules

Quality of

RulesPoliticization Resources Transparency

Citizen

Voice

Wage

SatisfactionService

State

Capture

Overall

Corruption

Ministère de la justice 63 51 55 44 37 47 72 19 67 44 39

Ministère de la Sécurité 62 50 57 44 38 47 74 18 69 38 35

Ministère de l‟Administration et de la Décentralisation 61 53 54 42 39 49 75 29 70 45 45

Ministère des Finances 76 72 60 40 43 58 80 28 67 51 30

Ministère de l‟Enseignement Supérieurs et Recherche

Scientifique62 50 56 44 35 46 74 20 69 47 42

Ministère de l‟Urbanisme et Habitat 76 42 33 64 75 38 5

Ministère de la Santé Publique 70 63 57 43 35 60 70 30 58 40 44

Service Communal 62 51 34 40 52 64 13 49 49

Service Sous Préfectoral 58 43 55 45 32 43 72 13 64 52 37

Ministère de la Communication 52 61 44 38 46 75 42 65 69

Ministère de la Jeunesse et Sports 60 52 56 42 42 53 73 11 71 52 42

Ligue Islamique Nationale 62 60 59 41 41 49 75 28 64 43 33

Ministère de l‟Agriculture 61 58 57 42 38 45 77 30 65 36 36

Ministère de l‟enseignement Pré Universitaire 67 69 57 41 50 50 72 42 76 45 31

Ministère de la Fonction Publique 44 60 45 44 44 71 25 56 10

Organisation Non Gouvernementale (ONG) 59 53 41 48 44 82 8 70 54

Entreprise Micro – Finance 32 73 8 80 13

Ministère de l‟Energie, Mines et Environnement 70 49 55 52 25 74

Whole Country 62 50 57 45 34 46 75 20 68 42 37

The indicators above take values between 0-100. To interpret them please keep in mind that:

-The higher the value of the governance indicator the better the quality of that dimension .

-The higher the value of the corruption index, the more severe the problem.

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Citizen Voice Improves Accessibility of Public

Services to the Poor (Bolivia, 1999)

Based on Public Officials Survey. The sample of institutions includes 44 national, departmental,

and municipal agencies which are a prior anticipated to be accessible to the poor

0

20

40

60

80

100

10 20 30 40 50 60 70 80 90

Voice / External Accountability

Access

ibil

ity t

o t

he P

oor

ControlledCausalLink

r = 0.54

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Disseminating Knowledge

Rules of the

game

Organizational Capacities

Governance system

performance

Exogenous

factors

Actionable Governance Indicators

http://agidata

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Lessons learnt

Do we actually know anymore what we are measuring?

Multi tools do not translate into less precision or confusion. Rather, “competition” allows us to improve our methodologies and to create interesting partnerships (Madagascar, Paraguay, Peru)

How can we help various stakeholders make appropriate use of all the tools out there?

Local focus, local capacity building, participation, and learning by doing (Paraguay, Peru, Sierra Leone)

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Lessons learnt, cont.

How do we balance global (ranking)

measurement tools with national assessments?

Two sides of the same coins, but with different

objectives. Important that the two approaches

complement each other

Who should be involved in measuring?

It depends on the country reality. Our

experience: the country as a whole. But donors,

INGOs can play a very important role (Sierra

Leone, Mozambique, Haiti). NSOs should also

be involved to promote sustainability (Peru,

Paraguay)

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Lessons learnt, cont.

What are the advantages and disadvantages of the approach used?

Pros: Greater local capacity, consensus and ownership that can ensure sustainability of reform process; south-south knowledge dissemination (Costa Rica, Zambia, Mozambique, Haiti)

Cons: Time consuming and costly; challenging to coordinate many different actors, especially international ones; unforeseen political changes

To what extent have measurement tools helped shape public sector reforms?

Honduras, Burundi, Mozambique, Madagascar

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Lessons learnt, cont.

Additional challenges

2nd generation diagnostics focus on sector

governance => more challenging to apply

this model at the sector level (Mauritania,

Senegal, Yemen and Morocco) Government commitment

Transparency of process

Participation of different stakeholders

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WB Governance Resources on the Web

Governance and Anti-corruption: http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:20040922~menuPK:34480~pagePK:34370~theSitePK:4607,00.html

Public Sector Group: http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTPUBLICSECTORANDGOVERNANCE/0,,menuPK:286310~pagePK:149018~piPK:149093~theSitePK:286305,00.html

Governance and Anti-corruption (WBI): http://web.worldbank.org/WBSITE/EXTERNAL/WBI/EXTWBIGOVANTCOR/0,,menuPK:1740542~pagePK:64168427~piPK:64168435~theSitePK:1740530,00.html

Governance Diagnostic Surveys Country Sites:http://www.worldbank.org/wbi/governance/capacitybuild/d-surveys.html

Courses and Surveys: Governance Diagnostic Capacity Building:http://www.worldbank.org/wbi/governance/capacitybuild/courses.html

Actionable Governance Indicators Website: www.agidata.info (internal)

www.agidata.org (external)

Additional material available upon request: AskGov@worldbank.org