Comparative Report on Compliance and Fragmentation of Governance

The ANTICORRP Project Work Package (WP) 10 on “Monitoring anti-corruption legislation and enforcement in Europe” has the overall aim to study state compliance and implementation of international and European anti-corruption norms in the EU member states. It is specifically interested in exploring whether international and European norms have an independent influence in prompting EU member states to adopt and implement effective anti-corruption laws, policies and practices domestically. While their research design and methodology are different, the three studies that are contained in this deliverable explore this broader issue by engaging in comparative analysis.
The first study on “Why do some countries comply with the Group of States against Corruption and others do not? A study of political finance international norms and domestic reform” by Dia Anagnostou and Evangelia Psychogiopoulou explores variation in state compliance with the Council of Europe (CoE) standards in the area of political financing and the factors that account for it. The analysis focuses on seven countries that exhibit different degrees of compliance with the CoE rules on the financing of political parties and election campaigns, namely Denmark, Germany, Greece, Lithuania, Spain, Sweden and the United Kingdom. The selected states exhibit compliance with GRECO regulatory standards on political financing, ranging from no compliance to strong compliance.
This qualitative comparative study builds upon our quantitative research in the second phase of WP10, as well as on pre-existing case studies. It employs the method of structured, focused comparison to explore systematically the factors that promote or conversely hinder the willingness and ability of national governments to comply and implement the recommendations that GRECO issues as part of its monitoring. It examines the legal framework governing the flow of money in politics in these countries and their response to the recommendations issued by the Group of States against Corruption (GRECO) as part of the monitoring carried out in the field since 2007. Why do some states comply with GRECO recommendations and proceed to significantly reform their national regulatory frame in response to these, while other states resist compliance and are unwilling to undertake changes in how they regulate political finance?
Based on the comparison of the seven country cases, three sets of factors emerge as salient in explaining why some states strongly comply with GRECO recommendations and others do so only limitedly, or not at all. In the first place, an important factor is how congruent or conversely conflictual (with the approach underlying the GRECO recommendation) is the national tradition or the extant constitutional/legal frame in a country. A congruent tradition or an already present regulatory propensity can facilitate compliance, while on the other hand, a conflicting tradition or existing approach can obstruct compliance and political finance reform.
Secondly, a key factor in explaining compliance is the existence or lack of political will among the government and political parties domestically. Domestic political will has been shown to be a crucial factor in state compliance with international law more broadly. Yet, besides being plainly unsurprising, the existence (or lack therefore) of political begs more questions than it answers: what factors configure political agreement with or opposition to GRECO standards and recommended reforms? Why and how does a substantial cross-section of government and parliamentary elites agree to take action or resist doing so in order to reform domestic laws and rules in line with what a Council of Europe body (the GRECO) recommends?
The area of political finance is not a typical policy area; the prevailing mode of decision-making, inter-party relations and divisions, as well as the influence that public opinion and civil society are able to exert more broadly, are not necessarily evidenced in the area of political finance. In order to explain compliance, we must understand why international pressure, as exercised through a peer review monitoring mechanism such as the GRECO, can at a particular point in time break through established patterns of decision-making between the main political parties in the area of political finance. We see this having happened in the case of Sweden, but not in Denmark or in the UK. To be sure, unlike Denmark and the UK, Sweden did have a culture of party finance regulation, even if on a voluntary basis, which made the distance from the regulatory approach of the GRECO shorter to begin with, making significant, albeit far from radical reform, possible.
The third factor that explains compliance with GRECO recommendations is a country’s position in the regional structure of power and in the international milieu more broadly. Its power in the regional and international terrain is defined both by objective factors that create dependence and external oversight, and by self-perception (how its elites perceive their state’s position). Α country like Germany, which is in a strong strategic, political and economic position in the regional and international realm, is not be able to ignore or change the rules for itself. On the other hand, countries that are a weak and dependent economic and political position, like Greece and Spain in the post-2010 period, have little space to negotiate and express their disagreements. They have even less space to resist complying with the GRECO recommendations, when such compliance is among the conditions for continuing external financial aid. Finally, this study shows that there is an inverse relationship between regulation and control of corruption: the higher the score of political finance regulation the lower the ability to control corruption.
The second study by Martin Mendelksi, entitled “The revival of Balkanization: How externally-driven reforms reinforce the fragmentation of governance in South Eastern Europe”, examines the impact of the EU and other international donors on the development of good governance in South Eastern Europe (SEE). The comparative analysis shows that the externally-driven good governance reforms improve substantive legality (the alignment of domestic legislation with international best standards), state capacity and efficiency but weaken formal legality (the inner morality of law), many aspects of impartiality and the coherence of state structures and policies. As a result, good governance is undermined. To explain the persistence and reproduction of bad (i.e. fragmented) governance, the author offers a “vicious reform cycle” explanation, in which a fragmented governance structure is reproduced by competing and factionalized actors and by fragmented and politicized reform and policy processes. The implication is that externally-induced reforms, instead of allowing to transition towards good governance, are reproducing Balkanization and “bad governance”, i.e. fragmented, unaccountable, personalized and instable state structures, policies and formal rules. The main argument is supported by a mixed method study. A quantitative indicator-based analysis measures the development of good governance across six dimensions between 2003 and 2015. Qualitative interviews (with judicial and political representatives from SEE, the EU and international organizations), relevant data and secondary sources offer revealing insights on processes of hybridization and fragmentization.