why a rule of law coalition for business?
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Why a Rule of Law Coalition for Business?. Why a Rule of Law Coalition for Business?. The field of rule of law is very broad Business has specific needs that may be lost in a broader rule of law application - PowerPoint PPT PresentationTRANSCRIPT
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U.S. CHAMBER OF COMMERCE
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U.S. CHAMBER OF COMMERCE
Why a Rule of Law Coalition for Business?
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U.S. CHAMBER OF COMMERCE
Why a Rule of Law Coalition for Business?
The field of rule of law is very broad
Business has specific needs that may be
lost in a broader rule of law application
Rule of law disputes tend to be highly
politicized, company or industry-specific,
and isolating – requiring business to
speak with a collective voice
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U.S. CHAMBER OF COMMERCE
The Link to Corruption
How to fight corruption?•Deterrence – Punishing corruption through penalties applied to providers and demandeurs•Prevention – Transparency, process, and automation measures that reduce the opportunities for corruption by systematically reducing discretion exercised by public officials
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U.S. CHAMBER OF COMMERCE
The Five Factors
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U.S. CHAMBER OF COMMERCE
The Five Factors
Five factors related to the rule of law determine the ability of business to make rational investment and operating
decisions, and thereby have a reasonable expectation of returning a profit in any given market
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U.S. CHAMBER OF COMMERCE
1. Transparency – Laws and regulations applied to business must be readily accessible and easily understood;
2. Predictability – Laws and regulations must be applied in a logical and consistent manner;
3. Stability – The state’s rationale for the regulation of business must be cohesive over time, establishing an institutional consistency across administrations, and free from arbitrary or retrospective amendment;
4. Enforceability/Accountability – Investors must be confident that the law will be upheld and applied equally to government as well as private actors;
5. Due Process – When disputes inevitably arise, they must be resolved in a fair, transparent, and pre-determined process.
The Five Factors
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U.S. CHAMBER OF COMMERCE
Defining Rule of Lawfor Business
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U.S. CHAMBER OF COMMERCE
Defining Rule of Lawfor Business
Rule of law for business exists where strong, efficient government institutions are accountable for the issuance, enforcement, and adjudication of market-governing rules through transparent, predictable, and pre-determined processes that maximize legal certainty for all aspects of economic activity.
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U.S. CHAMBER OF COMMERCE
Measuring Rule of Lawfor Business
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U.S. CHAMBER OF COMMERCE
Measuring Rule of Lawfor Business
Some Measurable Elements Suggested by Definition
Strength of government institutions;
Degree of governmental efficiency;
Existence and strength of internal checks and balances;
Legal basis for rulemaking authority;
Governmental capacity for legal and regulatory enforcement;
Access to and reliability of review and appeal processes.
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U.S. CHAMBER OF COMMERCE
Quantifying the Intangibles
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U.S. CHAMBER OF COMMERCE
Quantifying the Intangibles
The Rule of Law and BusinessDeveloping a Global Business Rule of Law “Dashboard” – Key Findings and Data
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U.S. CHAMBER OF COMMERCE
Quantifying the Intangibles:Building the GBRLD: Mapping, Extracting and Combining Indicators – a 3 step process
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U.S. CHAMBER OF COMMERCE
Expected Findings
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U.S. CHAMBER OF COMMERCE
Main FindingsIndices Mapped
• 12 indices/measures mapped and surveyed:1. World Economic Forum: The Global Competitiveness Report 2012-13
2. The World Justice Project: Rule of Law Index 2012-13
3. Transparency International: Global Corruption Barometer
4. Transparency International: Bribe Payers Index
5. Transparency International: Corruption Perceptions Index
6. Transparency International: Putting Corruption Out of Business Survey
7. Freedom House: Freedom in the World
8. Heritage Foundation: Index of Economic Freedom 2013
9. Global Integrity: Global Integrity Index
10. World Bank, Worldwide Governance Indicators
11. The World Bank and the International Finance Corporation, Doing Business 2013
12. Millennium Challenge Corporation: Selection Criteria and Methodology
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U.S. CHAMBER OF COMMERCE
Expected FindingsIndices and Indicators: No of RoL Business Indicators, % of Available Indicators
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U.S. CHAMBER OF COMMERCE
Expected FindingsMain Findings I: Qualitative
• Each index/survey seeks to measure different things: RoL, economic competitiveness, rate of corruption, governance etc.
• Overall some indices have a greater degree of focus and specificity of RoL business issues e.g. WEF, World Justice, GII and Doing Business
• But business related RoL indicators often lost in translation/overlooked as they are only a small part of overall findings
• Lack of specificity or focus on business related indicators is not a weakness or criticism of existing indices – not the purpose of the individual index to measure this
• Extracting and combining key indicators on RoL business issues into GBRLD reveals data/results that are often lost in a bigger index/survey
• But there are limitations – new and more detailed RoL business indicators included in existing indices would strengthen overall body of research
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U.S. CHAMBER OF COMMERCE
Next Steps…
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U.S. CHAMBER OF COMMERCE
Thank You!