Why Do Policies Fail?
By: João Gonçalves
Tags: Green, Sustainable Cities, Sustainable Development, Policy

Ingredient no. 2. Change-friendly institutions

Of course, one may ask: if we know what to achieve, why do we still design ineffective policies? Like a skewed compass, if policymaking is not aligned with the setting, it will face significant barriers. In the current ‘brown’ institutional framework, green policy collides with the incumbent ‘way of doing things.’ We need to know how we can make our institutions ‘change-friendly’ so that broad policy reform is possible.

We can take inspiration from a number of countries that have successfully managed broad transitions throughout history. These processes are, though, usually painstakingly slow. Let’s look at the example of Finland.

“God did not create hurry” Old Finnish proverb In the 1800s Finland was a peripheric Swedish colony. It was among the poorest places in Europe. A hundred years later, Finland was among the top global developed nations. Two root causes probably played a determinant role in overturning the destitute conditions of the XIX century (Pertti Haapala). Firstly, the Finnish started placing modernisation at the centre of public debates. A nation-wide consensus was gradually formed and, for the most part, institutionalised in legislation. The second cause is attributed to a transformation in world view and of the individual’s role in society (i.e. individual responsibility, equality, gender roles, parent-child relationship, religion). From then on, consecutive policies managed to take advantage of favourable commercial ties with Russia and Western Europe. Policy design was so grounded that the country was prepared for disrupting events. In the early 90s the government institutionalised easy access to the Internet for all and the development of information systems. As soon as Finland was hit by the 1991–1993 depression, the country was already in a position to take advantage of suddenly open global markets for communication technologies. Nokia was just around the corner.

In a democratic society, policymaking is always the result of reaching agreements between people (‘interests’) who have diverse or even conflicting preferences. This dynamic — I shall call it a figurative negotiation table — is also defined by a country’s institutions.

When the level of polarization is high, as we have been witnessing in the United States, agreements are seldom reached, and the outcomes are disappointing, i.e., any policy designed for change will be an isolated attempt. Where positive interests dominate, decisions are likely to be more adapted to actual circumstances, and they work!

This was the case in Finland. The intention of successive Finnish governments to carry out policies to modernise the country had the initial support of the population. Their stake in inclusiveness and equality was also fundamental in the long run. With supportive conditions in place, citizens voluntarily contributed to the policy’s implementation, even as results were apparent only after World War II.

This dynamic understanding of how policymaking actually works helps understand what status quo agreements are possible (in the ‘brown economy’). It also shows that we need to change the ‘negotiation table’ if we are to get different results. This is possible if we:

Add new interests groups to the ‘table,’ i.e., if governments start taking into account the preferences of new groups (ex. green or future-looking organisations); Modify the beliefs of existing social or business interests; or, Modify current economic incentives to business interests, such as launching a carbon tax.

Public pressure (e.g., the world youth’s demonstrations for climate action) or political leadership are generally the triggers that can set in motion these changes. As each country’s institutions gain a change-friendly quality, the state can then leverage the power of citizens, communities, and businesses to put in practice effective policies.

Leadership based on moral choices is key. Without it, the change that we need will just not happen fast enough.

Directions: Design inclusive decision-making processes for best alignment between the public and policy-makers.