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Complexity is a core feature of most policy issues today and in this context traditional analytical tools and problem-solving methods no longer work. This report, produced by the OECD Observatory of Public Sector Innovation, explores how systems approaches can be used in the public sector to solve complex or “wicked” problems . Consisting of three parts, the report discusses the need for systems thinking in the public sector; identifies tactics that can be employed by government agencies to work towards systems change; and provides an in-depth examination of how systems approaches have been applied in practice. Four cases of applied systems approaches are presented and analysed: preventing domestic violence (Iceland), protecting children (the Netherlands), regulating the sharing economy (Canada) and designing a policy framework to conduct experiments in government (Finland). The report highlights the need for a new approach to policy making that accounts for complexity and allows for new responses and more systemic change that deliver greater value, effectiveness and public satisfaction.

We live in a period of profound systemic change, and as in similar periods in the past, there is bound to be considerable instability and uncertainty before the new society and economy take shape. We have to identify actions that will shape change for the better, and help to build resilience to the inevitable shocks inherent in, and generated by, the complex system of systems constituted by the economy, society and the environment. These challenges require updating the way policies are devised and implemented, and developing more realistic tools and techniques to design those policies on the basis of appropriate data. In Systemic Thinking for Policy Making world experts from the OECD and International Institute for Applied Systems Analysis (IIASA) pool their expertise and experience to propose new approaches to analysing the interconnected trends and issues shaping today’s and tomorrow’s world. The authors argue that to tackle planetary emergencies linked to the environment, the economy and socio-political systems, we have to understand their systemic properties, such as tipping points, interconnectedness and resilience. They give the reader a precise introduction to the tools and techniques needed to do so, and offer hope that we can overcome the challenges the world is facing.

This report uses systems thinking tools to address pervasive problems in Slovenia's procurement system that the government has struggled to remedy through traditional regulatory means. The report outlines how room for innovation can be created within highly regulated policy domains and how governments can systematically benefit from it. Systems thinking allows for a new understanding of the role of procurement. The report explores potential reforms that could be designed from the bottom-up, to address specific behavioural and structural barriers – such as public perception, risk aversion, accountability and control functions – that cannot be addressed using only a legalistic approach.

This report serves to support the development of Latin America’s legal and regulatory frameworks for sustainability disclosure, the responsibilities of company boards and shareholder rights. The report presents the results of two OECD surveys on sustainability practices of listed companies and asset managers in the region. It also draws upon an OECD dataset on the current trends and features of corporate sustainability at the global level.

This report analyses sustainability policies and practices for corporate governance, both in Brazil and globally. It serves to support the development of Brazil’s legal and regulatory framework for sustainability disclosure, the responsibilities of company boards and shareholder rights. The report presents the results of two OECD surveys conducted with the participation of some of the largest public companies and asset managers in the country.

This report provides an overview of the current sustainability disclosure policies and practices, the responsibilities of company boards and shareholder rights in Asia. The report also presents current trends in corporate sustainability globally and in Asia based on the OECD Corporate Sustainability dataset. Importantly, climate change is one of the most critical sustainability matters currently facing companies in most Asian jurisdictions where companies that account for two-thirds of total market capitalisation are experiencing climate change related financial risks.

This report maps the activities of ten leading Supreme Audit Institutions (SAIs) in Brazil, Canada, Chile, France, Korea, the Netherlands, Poland, Portugal, South Africa and the United States. In particular, it looks at how these SAIs assess key stages of the policy cycle as well as resulting policies and programmes. SAIs have untapped potential to go beyond their traditional oversight role and contribute evidence for more informed policy-making. The report provides examples and case studies of SAIs’ activities that consider and support the integration of international good practices into policy and programme formulation, implementation and evaluation. It provides guidance for SAIs seeking to engage in oversight, insight and foresight, taking into account the SAI’s internal strategy as well as policy challenges and actors in the external environment.

Regulatory reforms have long been a focus for Southeast Asian nations, often as a way to improve the business climate and policy frameworks for trade and investment. The recent COVID-19 pandemic has spurred countries around the world to review and update their regulatory policies to respond to the current crisis and prepare for the next one. This publication presents a snapshot of the current state of regulatory reform across the region, with country profiles from all 10 Member States of the Association of Southeast Asian Nations (ASEAN) highlighting practices in three priority areas: whole-of-government initiatives, good regulatory practices, and use of digital technologies. It also offers an analysis of common themes identified across the profiles, including trends in regulatory reform, common challenges faced by countries, and future priorities in the region. It was developed in collaboration with the members of the ASEAN-OECD Good Regulatory Practices Network, and key regional partners including the ASEAN Secretariat and the Economic Research Institute for ASEAN and East Asia (ERIA).

Knowledge-based capital (KBC) results from business investment in non-physical assets such as R&D, data, software, patents, new business models, organizational processes, firm-specific skills and designs. This publication brings together the results of a two-year programme of work at the OECD on New Sources of Growth and the role of Knowledge-based Capital (NSG-KBC). This work shows that business investment in KBC is a key to future productivity growth and living standards. In many countries, business investment in KBC has increased faster than - and in some countries significantly exceeds - investment in physical capital (like machinery). To promote long-term growth and the jobs of tomorrow, governments must ensure that framework conditions, institutions and policies facilitate business investment in KBC. Emerging economies are also making concerted efforts to help their businesses accumulate KBC. This book sets out policy analyses and recommendations in the fields of: innovation; taxation; entrepreneurship and business development; corporate reporting; big data; competition and measurement.

This fifth peer review of the OECD Principles of Corporate Governance analyses the supervision and enforcement of rules and practices relating to related party transactions (RPTs),  takeover bids and shareholder meetings. The review covers 27 jurisdictions and is based on a general survey of all participating jurisdictions, as well as an in-depth review of supervision and enforcement practices in Brazil, Turkey, and the United States.

Unsustainable subsidies are pervasive in the industry, agriculture, transport and energy sectors of most OECD countries. They are expensive for governments and can have harmful environmental and social effects. Eliminating these supports requires comprehensive approaches which are supported by top political leadership, transparent in their potential effects on all parties, consistent over the long-term, and often accompanied by transition supports. This volume uses sectoral case studies to illustrate that achieving change in structural policies such as subsidies depends largely on good governance practices.

This report focuses on the challenges of governing infrastructure investment and public-private partnerships (PPPs) at the subnational level. Subnational governments – cities and regions – play a vital role in the infrastructure landscape. Infrastructure needs in energy, transport, water and telecommunications are substantial, estimated at USD 6.3 trillion per year between 2016 and 2030. In a tight fiscal environment, it is critical to diversify sources of financing for infrastructure investment and PPPs represent an alternative to traditional government procurement with the potential to improve value for money. However, PPPs are complex and sometimes risky arrangements that require capacity that is not always readily available in government, in particular at the subnational level. This report examines the challenges of using PPPs at the subnational level and ways to address them. It does so by focusing on three case studies: subnational PPPs in France, local Private Finance Initiative (PFI) projects in the United Kingdom, and PPPs in Virginia (United States).

This report analyses the legislative and institutional framework in France relating to the transparency and integrity of foreign influence activities. It identifies concrete policy measures adapted to the French context to make foreign influence activities more transparent, and to discourage foreign interference attempts that are made notably through opaque lobbying and influence activities. It also ensures that the risk of foreign interference is better taken into account when public officials move between the public and private sectors.

The assessment report explores the innovative capacity of the Latvian public sector to understand how innovation can be better supported and leveraged to improve the public sector's effectiveness and impact. It provides an evidence base for the development of a public sector innovation strategy and action plan.

This report examines the innovative capacity of the public sector of Romania, exploring opportunities for the public sector to work in new and novel ways to improve outcomes. It assesses the current innovative capacity and suggests paths forward to enhance capacity. The report provides foundational evidence for the creation of an action plan to enhance the public sector’s capacity to innovate for impact.

The governance of skills systems has always raised a number of challenges for governments. Being at the intersection of education, labour market, industrial and other policy domains, managing skills policies is inherently complex. Addressing these challenges is more than ever crucial as globalisation, technological progress and demographic change are putting daunting pressures on skills systems to ensure that all members of society are equipped with the skills necessary to thrive in a rapidly changing world. Strengthening the Governance of Skills Systems: Lessons from Six OECD Countries provides advice on how to make the governance of skills systems effective. Building on the OECD Skills Strategy 2019, which identified four main challenges of skills systems governance, the report presents examples of how six different countries (Estonia, Germany, Korea, Norway, Portugal and the United States) have responded to one or several of these challenges. It also outlines concrete policy recommendations together with a self-assessment tool which provides guidance to policy makers and stakeholders for designing better skills systems that deliver better skills outcomes.