How the Global Rule of Law and Business Dashboard Will Impact American Business

The rule of law is a principle that promotes and defends ethical business practices in the global market as a crucial factor to foster a worldwide investment climate that supports both equality and economic growth.

In 2013, the U.S. Chamber of Commerce founded the Coalition for the Rule of Law in Global Markets to help companies invest in markets where they have confidence in the integrity of the public and private institutions. Recently, the Coalition released the 2021 Global Rule of Law and Business Dashboard, a research tool covering 113 markets, regional profiles, trend summaries, and case studies that highlight how the rule of law can be used as a building block for economic recovery.

Below are some of the findings of the dashboard and its impact on American business and the economy.

The Dashboard Helps Create Impactful Actions for Businesses

The global rule of law is an incredibly complicated subject, but it’s important to analyze for a better understanding of how it impacts businesses. During his presentation on the findings of the 2021 Global Business Rule of Law Dashboard, Dr. David Torstensson, a partner at Pugatch Consilium, explained its necessity and the process behind it.

“There's a lot of good existing measures, whether it's the rule of law, ... business environment, economic competitiveness, etc., but not everything that is measured today is relevant to the business community,” said Dr. Torstensson. “What we're trying to do with the dashboard is to identify those components, those indicators, those survey questions that are most relevant to a rule of law from a business perspective, and then take them out, put them together and incorporate them into one measure — one snapshot that captures the rule of law for the business environment.”

The OECD Champions the Issues Highlighted by the Rule of Law Dashboard

The Organisation for Economic Co-operation and Development (OECD) is an intergovernmental organization with 38 member countries that is a champion of many of the causes brought to light in the rule of law dashboard through the private sector.

“The OECD maintains a number of important instruments, most notably the OECD anti-bribery convention, which is at the heart of the OECD anti-bribery framework,” said Charles Johnston, managing director of global government affairs for Citigroup and business chair at OECD. “Its position is that the organization is a leading institution in the fight against corruption. Beyond the legal instruments, the OECD actively engages in a variety of anti-corruption workstreams.”

“We in business must make it a priority to use our enormous resources to demonstrate the truth and the validity of the proposition that the rule of law can indeed protect rights and provide the opportunity for individuals to achieve their ambitions,” Johnston added.

Economic Incentives for Businesses Include Increased Rule of Law Scores

Ted Piccone, the chief engagement officer for World Justice Project, explained that there are many incentives for businesses and countries to participate in a better rule of law.

“Countries are incentivized to do better in the future, and we're engaged in conversations with governments regularly about their work to improve their [rule of law] scores,” said Piccone. “We also know that the [dashboard data] is important for a whole range of private sector actors, political and credit risk rating agencies.”

“Entities like the World Bank and OECD, state department USAID, and the European Commission are all heavy consumers of this work,” Piccone continued. “It's encouraging to see that people are looking to this kind of data for evidence-based approaches.”