Author

Michael Bray is in-country engagement director for the International IR Council and professor of practice (IR) at Deakin University, Australia

Two elements of successful public policy implementation are policy content and governance. While content is a government affair, its governance could be improved by applying business-related concepts, notably integrated reporting (IR).

IR could be the conduit for more outcome-focused thinking in public policy across electoral cycles. It could more effectively communicate the outcomes for the electorate, allowing them to better evaluate the current and prospective effectiveness of implementation of policy initiatives. IR, in other words, would introduce a greater element of accountability into public policy implementation.

Ineffective implementation

Australia’s energy policy is one good example of how IR can contribute to better implementation governance. While governments around the world have attempted to adjust energy policy, effective implementation has largely eluded them – not least because of the long lead time between policy inception, implementation and impact. Energy policy is not alone in this respect.

Part of the particular difficulty in Australia is that while the federal government ‘owns’ the country’s energy resources, it is the individual states that control them. The end result is that target policy outcomes are not always identified and agreed on an integrated federal/state basis.

IR could act as the tool that brings together potential sources of finance with the project proponents to offer more certainty about policy outcomes for the short, medium and long term

Practical application

I see a government integrated report as a broad but concise statement – no more than 50 pages, with electronic links providing more detail for those who want it – that would cover the:

  • what – an integration of key policies, associated risks and opportunities
  • with – the parliamentary, financial, infrastructure, ministerial and public service, community engagement, innovation and technology, resources and relationships available to and used by it
  • how – the government approach, departmental management approach to risk and opportunity management, and how these are achieved using available resources and relationships
  • why – evidence as to why the government is making appropriate progress on implementing the policies it was elected on, and if not, why not, and what it is doing about it.

Australia’s governments budget for the implementation of national energy policy on an annual basis, then account for expenditure over the previous 12 months. There is no generally accepted performance measurement system to track progress, other than government spending, and the amount of past expenditure is simply passed on to the next government after each election without any accountability for the outcomes and impacts that will result.

IR could act as the tool that brings together potential sources of finance with the relevant project proponents to offer more certainty about public policy outcomes for the short, medium and long term. It is not uncommon to hear phrases like ‘finance will always be available for good projects’, but there is currently no clear pathway from government policy to project analysis and selection, commercialisation, public policy outcomes and the impact for all stakeholders.

The great explainer

In the business world, IR provides a window into the quality of an organisation’s thinking. It explains the ‘what’ of the organisation – its creation of value for the organisation and other stakeholders in the short, medium and long term. It explains the resources and relationships the organisation can tap into to produce its outputs and outcomes (the ‘with’).

It also explains the ‘how’ of the value creation process, with references to the governance framework, the business model, and risks and opportunity management. Finally, IR highlights the ‘why’ of integrated thinking: why the organisation is best placed to realise its outcomes and whether it is on track to reach the desired goal.

And IR allows governments to tell the story of their ‘what’, ‘with’, ‘how’ and ‘why’ in a more integrated fashion. Only IR connects reporting of how an entity or government creates value with the value it seeks to create and the resources and relationships it will use in doing so, articulating the organisation’s or government’s competitive edge.

In the public arena, IR could provide electors with a way to distinguish between the policies and longer-term resource allocation plans of candidates, and provide evidence for judgments about who is best placed to implement policies in the short, medium and long term.

Telling – and progressing – the story

A government’s integrated report would tell the story of the government and its resilience for the current term, and provide the basis to advance the story in the medium and long term across electoral cycles. IR would allow public sector adopters to show they are thinking and acting in a more integrated way – for example, that federal and local government are working more closely together, thus improving policy definition, resource allocation, governance, performance and outcomes.

See the left-hand box for what this means in practical terms.

In the business world, IR encourages better business practices and more informed decision-making by stakeholders. If we transfer this to the public policy context, it could improve stakeholder decision-making, national productivity, international competitiveness and the efficient operation of capital markets.

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