The WDR 2017 on Governance and Law: Can it drive a transformation in development practice?

January 31, 2017

     By Duncan Green     


Stefan Kossoff (DFID’s governance czar) reviews the new WDR, published this week.Stefan Kossoff

For those of us working on governance this week’s publication of the 2017 World Development Report on Governance and Law (WDR17) has been hotly awaited. And I’m pleased to say the report–in all its 280 page glory–does not disappoint (there’s a 4 page summary for the time-starved). As Duncan Green, Brian Levy and others have noted, WDR17 is a landmark report which has potentially far-reaching implications, not just for governance work but for the entire development agenda.

WDR coverIf the Sustainable Development Goals (Goal 16) set the vision for work on “peace, justice and effective, accountable and inclusive institutions”, the WDR performs an important service in elaborating how we might get there. But the WDR17 is consciously not a “blueprint for action” – on the contrary, it provides a compelling argument for why technical blueprints, best practice solutions and other efforts to transplant institutions from one context to another are unlikely to succeed. In so doing it provides a rallying call for a much humbler, more realistic governance agenda which is both politically smart and locally-led.

This WDR is different from previous WDRs because it asks not “what” needs to change for development to happen, but “why” policy and institutional reforms often fail, including many of those (like anti-corruption commissions) prescribed by the IFIs. Drawing on an impressive range of historical examples—from Ancient Greece to modern day China, Brazil and Somaliland amongst many others—the WDR rehearses some familiar but important arguments about the centrality of institutions for a range of development outcomes including peace, growth and equity; the importance of institutional “function over form”; and the critical role that political power plays in shaping the nature and pace of change.

While the message that “politics matters” may not be a new one, the fact that the World Bank—with its apolitical WDR 17 frameworkmandate—is saying it, is hugely significant. The emphasis on “elite bargains”, citizen engagement and international action in promoting governance change certainly feels a long way from the technocratic reform agenda of the 1990s.

But articulating this argument is one thing, actually acting on its implications is quite another.  So the big question is whether the WDR can genuinely lead to a transformation in aid practice both in the World Bank and beyond.

The jury is currently out but there is certainly scope for some optimism. The Bank has committed to “operationalise” the WDR17 as part of the IDA 18 replenishment package. (The International Development Association is the World Bank lending arm for the world’s poorest countries. Every three years donors meet to replenish IDA resources and review its policy framework.) The details have still to be fleshed out, but this could herald a significant change in the way the Bank works – for example in the area of economic policy where the emphasis on “best fit” and politically-feasible advice would represent a decisive shift away from best practice orthodoxy. The WDR also provides an opportunity to forge a concrete agenda for action across the wider development community, linking with existing initiatives around “thinking and working politically”, “going with the grain” and “doing development differently”. To kick off the discussion, I would identify the following as important elements of that agenda:

  • Make the WDR17 relevant for everyone working on policy and institutional reform. The WDR will be a wasted opportunity if it is only preaching to the converted in the governance community. As the report argues, governance needs to be “front and centre” of work on economic development, conflict and service delivery. But this means winning hearts and minds amongst economists and education, health and infrastructure specialists too. We also need to break out of our aid silos and collaborate with partners across government to address common challenges arising from corruption, crime and instability.
  • WDR17 fig 3Fully embrace a politically smart, flexible and adaptive approach to aid delivery, completing our evolution away from technical blueprints. This means more development strategies and programmes which address the political as well as technical barriers to development progress. As Alan Hudson points out, it also means creating the systems and processes which allow for more flexible and adaptive working – including better problem diagnosis; more innovative approaches to procurement and contracting; greater investment in monitoring, evaluation and learning; and new skills and capabilities for staff. Lastly, it means a fundamental change in organisational culture so staff are empowered and incentivised to think politically and work flexibly.
  • Engage with elites and citizens to expand the policy space and support governance change. Development agencies will always be peripheral actors in bigger stories of governance change. But, rather than promoting our own institutional fixes, we can have more impact by supporting home-grown efforts to build consensus amongst elites, empower citizens and develop institutions that are both capable and legitimate. This work is not easy, but it can have potentially transformative results. DFID has a growing number of programmes working successfully in this way, including on extractive transparency in Nigeria, hydropower reform in Nepal, education reform in Pakistan, and service provision in Burma.
  •  Tackle the international drivers of bad governance and promote new international norms. It WDR17 fig 4is clear that country-level governance dynamics are increasingly being shaped by cross border and transnational flows. Many of the biggest governance challenges of our time including corruption, tax evasion, illicit trade and violent extremism are global in nature. This demands a global response. Last year’s International Anti-Corruption Summit was a great example of how international action can be galvanised to address these threats – including through measures to strengthen transparency in the UK such as the new register of beneficial ownership. International initiatives like the Open Government Partnership and Extractives Industry Transparency Initiative also have an important role in promoting global norms on transparency and accountability, particularly given trends towards creeping authoritarianism and closing civil society space across the world.

In DFID we are taking forward work on several of these fronts. The UK Aid Strategy puts governance at the heart of HMG and international efforts to tackle the underlying causes of instability and poverty. Our new Economic Development Strategy, also being launched this week, goes even further in articulating the links between governance, growth and private sector development. DFID has long sought to understand the “drivers of change” in partner countries and put political economy analysis at the heart of our programmes in order to enhance impact. This has been combined with recent efforts to simplify and streamline our aid processes and create more space for flexible and adaptive programming. We are still on a learning curve and certainly would not claim to have all the answers, but the WDR offers a good opportunity for us to consider what more we could do improve practice on the ground and deliver better development results.

Stefan Kossoff is Head of Profession for Governance for the UK Department for International Development

January 31, 2017
Duncan Green