Governance

Governance

The Governance Project is dedicated to deepening our understanding of the root causes of the seismic shifts in many political systems.

The Governance Project is dedicated to deepening our understanding of the root causes of the seismic shifts in many political systems in both developed and emerging economies and to designing and testing responses that can help revitalize democracy and foster institutional transformation.

Within the overall Governance Project, we will explore links between the governance subprojects, e.g., demonstrating ownership links between media holdings and other business interests in specific countries undergoing transformation.

The Governance Project currently has two subprojects:

Arena

Based at the Institute for Global Affairs (IGA) within the London School of Economics and Political Science (LSE), Arena is the first programme dedicated solely to the issue of disinformation and 21st century propaganda.

Arena aims to respond to a real need: the information revolution of the past decade has made it far easier to transmit disinformation than ever before.

The “age of information” has mutated into the “age of disinformation”. The proliferation of false stories and the division of citizens into mutually exclusive echo chambers are undermining democracy.  Authoritarian rulers have learnt to entrench their power by flooding societies with disinformation. Aggressive states and terrorist groups use mass media falsifications, hate videos and social media ‘trolls’ to destabilize other countries and communities. Across the world the internet and global media have empowered conspiracy theorists and violent extremist groups to set the social agenda.

Read more about Arena.

Corporate governance

The Global Political and Corporate Governance Initiative aims to contribute with targeted research and policy advice to two key pillars of good governance: political governance and corporate governance. These are covered by two distinct though interrelated projects that IGA is undertaking, with the engagement of academia, government, civil society, international financial institutions and the private sector.

Motivation

Good corporate governance is a cornerstone for a growth-friendly, accountability-focused, and socially acceptable business environment. Yet in today’s globally integrated economies good corporate governance is challenged on two main accounts:

  • First, information on beneficial ownership, i.e., who are the ultimate owners of a particular entity, is incomplete even in advanced economies, and often deplorably poor in emerging and developing economies. Without such information it is very difficult to determine whether transactions between companies or between companies and their lenders are taking place in a fair manner. When ultimate owners are not known, accountability is more difficult to exercise and corruption easier to hide. This is still a serious issue in advanced economies, and even more so in in emerging and developing economies. Improving corporate governance becomes an essential part of reforming political governance particularly in the latter countries.
  • Second, in today’s globally connected economies, there is a mismatch between the cross-border/transnational nature of large corporates, and their corporate accountability, which is is still largely nation- based. Transparency about beneficial ownership in today’s globally connected world requires cooperation and information sharing among countries.

A major breakthrough in this area is a new transparency action by the UK. Launched in 2013 under Secretary of State for Business Sir Vince Cable (now Professor in Practice at LSE IGA co-lead of this project) and formally announced in April 2016, the initiative forces unlisted firms and companies registered in the UK to publicly disclose beneficial ownership. It establishes a new central public register on who owns and controls companies in the UK. The central register of companies' beneficial owners are made available through the government agency Companies House, with a first set of data released on July 1, 2016. This project aims to conduct research on the new emerging data and communicate it to the wider public.

This is critical because this new database is naturally a large raw metadata and only appropriate research will the new data be truly understandable, unlocking its huge potential. The main focus of this project is the UK, yet we expect that the new information will shed light on, and have a major impact on, corporate ownership structures outside  the UK. Through information sharing with, and feedback from these countries, ownership and governance in the UK will also improve.

Objectives

The Institute for Global Affairs (IGA) at the London School of Economics (LSE) leads the project “Who Owns What” (WOW). The WOW project’s ambition is to enhance evidence-based understanding of corporate structures for policy makers and the society in today’s interconnected world through exploiting the new dataset based on the UK (and its potential extensions to many more countries).

Project WOW innovatively brings together top academics from the LSE with a unique set of stakeholders with interest in promoting corporate transparency and accountability worldwide. We have created a multi-stakeholder platform of LSE faculty, civil society/NGOs (Global Witness, OpenCorporates, One and Transparency International), representatives of the UK government, international financial institutions (IFIs).

The project’s has five specific objectives:

  • Research the new data with the objective to improve corporate governance and transparency. This is an important goal overall as argued above; however in the post-Brexit context its importance has increased to ensure an open and transparent business environment.  Research will cover relationships between corporate governance structure and economic and political economy outcomes.
  • Assess the innovative methodology of the UK government. The new methodology (dataset, cost of compliance etc) is brand new and it will be important to analyse whether this new UK model is working and how it can be improved.
  • Use this analysis to assess cross-border holdings of foreign countries in the UK. In addition, perform similar exercises in emerging economies that have signed up to the UK Government’s initiative. Ukraine has announced its interest in participating in such an exercise.
  • Provide a set of evidence-based recommendations to inform affected governments’ policy decisions in the related areas.
  • Engage key stakeholders in this area (policy makers; NOGs; academia; IFIs; G20 process) to leverage each other’s remit, mandate and toolkit for maximum impact;   
  • Help inform the public in this critical area, thus contributing to more sustainable social outcomes. Public awareness and information about this critical governance area has an impact on political governance and associated reforms.    

Main deliverables

  • Set of high quality a research papers  and associated policy advice;
  • Policy proposal  on good practice on public disclosure on beneficial ownership, informing, inter alia, the G20 process and the public;
  • Mobilise key relevant government and non-government stakeholders through a unique multi-stakeholder platform as described above and outreach;  
  • Engage with IFIs for them to collectively start public disclosure of the beneficial owners on their new projects (retroactivity on stock of projects may not be possible for legal reasons);
  • Organise high profile conferences drawing on this multi-stakeholder platform, which will be accessible to, and actively engage with, the public. We hope to continue with our fruitful engagement with the UK government;
  • Design an implement a specific communication strategy for dissemination of new research and policy recommendations. These will involve, in addition to open conferences, dedicated sections of its multi-stakeholder participant’s websites and other outreach instruments within the toolkit of each stakeholder. 

Events

  • Data dive into new public data on beneficial ownership, organised by Global Wittness. See the results.
  • Global Wittness held a followup meeting in late October and organised, along with other NGOs, a data-dive exercise in mid-November, where LSE students also participated.
  • A meeting with several IFIs and the LSE IGA was held on the margins of the IMF-World Bank Annual meetings in Washington DC on October 7, hosted by the Inter- American Development Bank (IADB). A plan was drawn on IFI support for disclosure of beneficial ownership. 
  • The inaugural meeting of the WOW multi-stakeholder group took place on July 6, 2016 at LSE.

News

  • LSE IGA Professor in Practice Anne Applebaum on CNN on Donald Trump’s speech in Warsaw and his emphasis of the importance of protecting western values from oppression.

  • IGA Professor in Practice Anne Applebaum speaks to BBC World at the Intelligence Squared Debate about how Donald Trump has not kept any of the legislative promises that he made for his first 100 days. Watch the video.

  • A visit to to a secret performance in an illegal theatre in Europe's 'last dictatorship': and what it tells us about the politics and latest protests.

  • Do you who want to learn how to play the modern media like Putin or Trump? Just follow these simple guidelines and you too can make it as a 21st century post-fact populist. 

  • Belarus is nicknamed the 'Last Dictatorship in Europe', but rather than being a Soviet relic it is a very modern authoritarian model which uses nostalgia in strikingly contemporary ways. Read more about it. 

  • “Is Donald Trump a postmodern president?” In this opinion piece as part of Newsnight, journalist, writer and IGA Visiting Senior Fellow Peter Pomerantsev argues that President Trump and President Putin share a disdain for facts - and that this is part of their appeal.

  • IGA Professor in Practice Anne Applebaum talks to the Washington Post about the real story in the Netherlands being the implosion of the centre-left. Read the full article.

  • LSE IGA hosted a high calibre panel on Ukraine’s Maidan Revolution on February 20 as part of the ongoing LSE Literary Festival with Anne Applebaum/LSE, Olena Bilan/CE, Dragon Capital,Mustafa Nayeem/MP, Ukraine, and Vladyslav Rashkovan/former Deputy Governor of the Central Bank of Ukraine.  You can listen to the podcast and find a full  summary.

  • Pomeranzev, P., February 2017, ‘Wolves in Nationalist clothing’Politico.

  • IGA Visiting Professor in Practice Anne Applebaum in the FT on Europe needing a new defense pact and Britain potentially leading it. Read the full article.

  • IGA Visiting Professor in Practice Anne Applebaum spoke to Channel 4 News on the upcoming launch of an exciting new project with the London School of Economics, which will investigate the spreading of untrue information. Watch the video.

  • IGA Professor in Practice, journalist and prize-winning historian Anne Applebaum spoke to the Washington Post on the idea of a ‘global’ Britain in the context of Brexit and the newly developing U.K.-U.S. ‘special relationship’. Read the full article.

  • IGA Professor in Practice, journalist and prize-winning historian Anne Applebaum spoke to Spiegel on what the rise of Donald Trump means for Europe, what the future holds for NATO and whether democracy can survive the rise of right-wing populism. Read the full article.