Partial Two‐Way Mirror: International Organization Budget Transparency

Abstract

This paper evaluates the budget transparency of international organizations. Building on IMF, OECD, IPSAS, and Open Budget Survey standards for sovereign‐state budget transparency, we create a 93‐item budget transparency measure reflective of international organization characteristics. International organizations are important global dispensers of accumulated knowledge. This includes the purveying of advice on member state budget transparency. Despite this role, we find only partial budget transparency among our surveyed international organizations. Nonetheless, the international organization financial management and accountability practices were more transparent than their budget process or budget disclosures.

The United Nations’ (UN) decision to adopt International Public Sector Accounting Standards (IPSAS)

“…The legitimacy crisis stemming from the confluence of events (long-standing issues over accountability; oil-for-food and UNSAS' loss of legitimacy; close voting on alternative standards; the emergence of IPSAS) presented reformers with an opportunity to effect change, regardless of whether the proposed change would actually resolve the intrinsic problems they wanted to redress. In reality the core issues lay with those vested with decision-making powers, and improved financial reporting does not necessarily lead to improved decision-making transparency, as evidenced by Moloney and Stoycheva's (2018) study on budgetary disclosures in IOs. Politicians and senior government decision makers need to resist calls for a quick response to a crisis of legitimation to ensure that the problem(s) is correctly identified before a solution(s) in the form of a major accounting change is applied as a remedy.…”

“…Evidence of accounting reforms having resolved these organisational issues stemming from a lack of accountability is at best mixed. Bergmann and Fuchs (2017) as well as Moloney and Stoycheva (2018) found evidence that adopting international standards for IOs can bring some improvements in transparency. Both papers also found that standards adoption could prompt meaningful debates over existing financial reporting complexities.…”

“…Both papers also found that standards adoption could prompt meaningful debates over existing financial reporting complexities. Bergmann and Fuchs (2017) noted the issues with IPSAS' revenue recognition standards in their analysis of the way in which UN System organisations reported on voluntary contributions, while Moloney and Stoycheva (2018) found that financial reporting practices of IOs were, generally speaking, more transparent than their budgetary processes.…”

Learning from the Commission case: The comparative study of management change in international public administrations

“…The first study focuses on the introduction of transparency measures (especially access‐to‐information policies) within IPAs (), whereas the second one addresses the establishment of bureaucratic oversight mechanisms over time (). In another comparative study, Alesani et al () focus on a narrow reading of the accountability concept as financial and non‐financial disclosure of information in annual reports (for another recent study on budget transparency see Moloney and Stoycheva ). Similar to Geri (), the authors use a checklist approach that divides the concept into eight sections.…”

Creating Space for Public Administration in International Organization Studies

“…Yet if such structures do not exist, are weak, disembodied, or false at the global level, what are the implications for an IO administration agenda? This includes acknowledging any implications for IO administrative research in typical public administration studies as such as leadership (Xu & Weller, 2019), personnel management, collaborative governance, and budgeting (Moloney, 2019; Moloney & Stoycheva, 2018; Patz & Goetz, 2019), to name a few.…”