The Benchmark for Fifth Generation Collaborative Regulation
The G5 Benchmark was launched in 2020 and quickly became the gold standard for fast-track collaborative, cross-sector regulation. It was quickly well-received – and has proved itself a practical navigator for country regulators, helping them establish roadmaps towards G5 collaborative regulation excellence and inclusive digital transformation across all sectors of the economy.
Quick primer on last year’s G5 Benchmark pilot edition
The pilot version covered more than 80 countries and evaluated regulatory frameworks against 25 measurable indicators, clustered across three pillars. Each country could score itself out of a 50-point maximum. The simple scoring methodology has proved powerful and popular with regulators, generating discussion and interest – and importantly very real in-country focus on how to move forward along the collaborative regulation pathway.
Why refining the G5 Benchmark pilot version?
We received important feedback on the pilot version through extensive consultations and to enhance it, we engaged in a design thinking process involving experts, academics, regulators and practitioners of different kind. A multi-stakeholder Review Board was convened to examine the methodology of the tool and scrutinize the initial results. The Board made up of world-class experts, notably academics, data wizards from international organizations, industry associations, regional regulatory associations and a think-tank.
What’s new in the 2021 version? A quick look
The new G5 Benchmark takes data from 157 countries and expands to cover four pillars, with 66 indicators taken into account. Each country can score itself, with a 100-point maximum. The pillars are:
- National Collaborative Governance
- Policy Design Principles
- Digital Development and
- Digital Economic Policy Agenda.
Objectives and scope remain the same, and importantly, the G5 Benchmark maintains its signature practicality and simplicity, offering regulators a powerful, straightforward readout on where the country is on the collaborative regulation pathway. Changes have been carefully calibrated to ensure countries can meaningfully assess their progress in 2021 against their 2020 score too.
Three new dimensions that increase the Benchmark’s relevance
The new version broadens the scope and depth of the tool, with a focus on three important elements that together contribute to an authoritative readout on countries’ progress as digitalization takes an increasing hold on economies.
One – an expanded scope tracking the shift from ICT to the digital economy
What exactly constitutes the digital economy? In measuring a country’s regulatory progress, the 2021 G5 Benchmark addresses an expanded definition and takes into account not only industries involved in the production of digital goods and services (part of the domestic digital ecosystem) but also the spillovers of digital technology on all economic sectors. Such spillovers include the multiplier effect that digital technology and business models have on the overall economy. These could include productivity gains, faster growth or digital investments that lead to the development of new business models – ones which for example feature mobile connectivity, flexible working, higher utilization and productivity. Spillovers increase as the digital consumption of enterprises increases, from agriculture to logistics. Digital technologies in some countries can contribute as much as 25 per cent to all sectors of the economy.
Two – the imperative for collaborative regulation across agencies
The 2021 G5 Benchmark measures collaborative regulation within the development of regulation and policy making. As the digital economy becomes more important within a country’s GDP, countries need to implement regulatory and policy development frameworks cross-sectionally and collaboratively. ICT regulation needs to be consolidated across adjacent sectors, such as media, and the Internet, while coordinated with other infrastructures, to identify opportunities for cross-sectional proactive intervention. The 2021 G5 Benchmark looks into both the breadth and depth of collaboration. Breadth of collaboration looks at how the ICT regulator coordinates with authorities in charge of competition, consumer protection, finance, energy, broadcasting, spectrum, management, and Internet issues. Depth of collaboration considers whether regulators have engaged in informal, formal collaboration, or have put in place other hybrid mechanisms.
The Benchmark recognizes that there is no single approach to collaboration mechanisms and that these can range in nature from informal to formal. Sometimes, informal collaboration (such as ad-hoc coordination meetings) stands out with its flexibility but may also bring uncertainty regarding results. On the other hand, formal collaboration (such as developing cross-ministerial committees) brings a degree of stability, but may prove rigid under certain circumstances.
Three – the need for governments to develop a digital economy policy agenda
Econometric modelling suggests that a country’s digital economy is critical both to economic growth and to job creation – no longer a choice then, but an imperative. Accelerated development of the digital economy helps achieve diversification, increases competitiveness in the global economy, meets burgeoning demand and ensures economic resilience. Policy-makers need to ensure capital spending on ICT infrastructure, a deepening of the talent pool, a strengthening of innovation, the promotion of local digital industries, and the fostering of digital transformation of enterprises across the economy more broadly. The new G5 Benchmark then captures how countries are addressing these needs via an active policy agenda that expands well beyond the ICT scope, through collaboration with agencies and ministries in other sectors, such as logistics, industrialization, rural development, and others.
Keep reading: Expert Review to the Review Board of the G5 Benchmark, June 2021