A black box assessment of institutional quality: the challenge of evaluating lobbying transparency

ABSTRACT

Lobbying is considered to be a legitimate feature of democratic systems, but a question arises concerning the methods used to influence decision-making processes in these systems; the behaviour of lobbyists and decision-makers can be non-transparent, and it unfairly influences political processes. These accompanying phenomena significantly affect institutional quality. In this paper, we define the link between transparent decision making and a transparent lobbying environment, we provide a new set of indicators for a more precise assessment of the transparent lobbying environment in Catalogue of Transparent Lobbying Environment and we demonstrate the differences between our approach of evaluating transparent lobbying and existing methods for six CEE countries empirically. Finally, we address institutional quality and its evaluation in connection with transparent lobbying and demonstrates the potential of the catalogue. We argue that a transparent lobbying environment should be analyzed in the broader context of the decision-making process and is essential for institutional quality. In this respect, our approach emphasises implementing the so-called sunshine principles to improve current methods of evaluation of transparent lobbying.

KEYWORDS:

• Transparency
• lobbying
• institutional quality
• measures
• sunshine principles
• evaluation

Introduction

Although there are various indicators and indices for measuring institutional quality (IQ), whether all measured areas have sufficient informative value about the properties of their relative examined area is an open question. If not, then whether there are suitable tools that contribute to a more robust outcome/assessment of institutional quality must also be determined. One possible way to reflect specific aspects of institutional quality is an effort to evaluate lobbying transparency. Currently, the most popular evaluation of transparent lobbying regulation is based on the index of the Centre for Public Integrity (CPI), which examines the strictness of lobbying laws. For IQ evaluation, it is necessary to clarify what triggers efforts to implement lobbying rules and, in addition to lobbying laws, what measures create a transparent lobbying environment for decision-making processes.

The literature lacks a broader view of the evaluation rules for transparent lobbying. However, we argue that the focus on measurements of the level of transparency and accountability of lobbying laws is just one piece of the puzzle. Thus, we also follow Crepaz and Chari (2018, 27) and argue that measurements of the level of transparency and accountability of lobbying laws “need to constantly adapt to the new elements that define the systemised concept they seek to capture.”

The article therefore aims to fill the gap in evaluating the rules of transparent lobbying in terms of decision-making and to determine the connection between IQ and a transparent lobbying environment. We aim to identify what provisions supporting the transparency of decision-makers must be considered when discussing lobbying transparency in terms of decision-making to strengthen IQ.

We address the following questions: What are the determinants of transparent lobbying that is associated with the decision-making process? How do the relevant measures related to lobbying transparency contribute to IQ evaluation? Moreover, we assume that lobbying is an integral part of public decision-making and that the quality of all factors that influence decision-making can be expressed and reflected by IQ indicators.

This article is organized as follows: The second chapter describes the theoretical background of lobbying regarding institutional quality, rules, transparency, and information. The third chapter defines the link between transparent decision-making and a transparent lobbying environment, including the motivations for and the objectives of regulation (accountability, integrity, participation, open government data, etc.). It also reflects on the recent approaches that have been used to evaluate lobbying rules and provides an innovative catalogue of all relevant measures regarding lobbying transparency – the catalogue of transparent lobbying environments (CTLE). The fourth chapter addresses IQ and its evaluation in connection with transparent lobbying and demonstrates the CTLE’s potential. The final section draws the main conclusions.

To achieve the article's goal, we use the explanatory method to investigate the objectives and reasons for lobbying regulation and for the necessity of a broader approach. Next, we suggest a new set of indicators to provide a more precise assessment of the transparent lobbying environment, i.e. the innovative CTLE. We introduce the differences in our approach of evaluating a transparent lobbying environment by empirically examining transparent lobbying environments in six countries by using comparative methods. Finally, we analyse and demonstrate how the use of a broader approach represented by the CTLE contributes to a more precise IQ evaluation of decision-making processes.

Theoretical underpinnings

High-quality decision-making that aligns with public interest may be enhanced by transparency. Transparency will prevent “wrong-doing” (Scharpf 2003, 4), make decision-makers more “responsive” (Heritier 1999, 272) to the public and “secure the adoption of more impartial decisions” (Gargarella 2000, 202). Nevertheless, not all the literature is clear about these positive effects (see below).

The transparency of activities that influence decision-making processes prevents the production of extractive institutions (Acemoglu and Robinson 2013) that serve a limited number of elites, which will entail that most of a society is disadvantaged and excluded from decision-making. The indicators used to evaluate the quality of an institutional environment often focus solely on the fundamental existence of essential institutional elements, such as access to information and right of association. However, these elements are not sufficiently evaluated in terms of their characteristics and/or forms that reflect the quality of their mutual interactions. We therefore argue that the transparent lobbying conceptualised in this article might be a useful tool to complement and refine IQ evaluation.

Today, lobbying is primarily used as a generic term for influencing public officials’ positions and decisions. Grossman and Helpman (1994) conceptualise lobbying as the provision of resources for a policy-maker. Other scholars define lobbying as persuasion or advocacy (Müller et al. 2010), a legislative subsidy (Hall and Deardorff 2006), a representation of interests (EC 2008; Warleigh and Fairbrass 2002), communication (Milbrath 1960, Müller et al. 2010), or influence that is directed at rule-makers (Campos and Giovannoni 2017, 919).

Early research in the field mainly focused on US interest groups, and many empirical studies of interest representation in the European Union have been intensively developed over the last 30 years (for an extensive list, see Coen 2007a, 2021; Beyers, Eising, and Maloney 2008; Bunea and Baumgartner 2014; Greenwood 2017). Some studies have begun to address the institutional opportunities and constraints in the EU that determine who is a lobbyist and when and how to lobby (Woll 2006). The research on interest groups in the EU stresses the critical tension between “political” legitimacy (in the sense of elected and designated representatives) and “policy” legitimacy (policies are created through the participation and expertise of nonpolitical actors during consultations – specific, depoliticized institutional arrangements), leading to EU lobbying transparency debates due to the existence of elite pluralism (Coen 1998; Bouwen 2002; Schmidt 2006; Mazey and Richardson 2006; Eising 2007; Coen 2007a; Papadopoulos 2010; Weale 2011; Klüver, Braun, and Beyers 2015; Schmidt 2020). Elite pluralism is based on relationships between insider interest groups and EU officials and results from regulatory agency styles similar to Brussels policy-making (Coen 2007b, 9). Accordingly, the “policy-making” legitimacy of the European Commission is considered high by most EU interests (Scharpf 1999; Majone 2001), and the debate on building more regulatory models of lobbying concerning representativeness, accountability, credibility, and trust (Coen 2007a) has become important. In the context of the tension between “policy” and “political” legitimacy and multilevel governance in the EU, the most recent studies therefore identify changes in business lobbying strategies, which utilise “multivenue and multilevel targeting, employing a diverse mix of resources” (Coen, Katsaitis, and Vannoni 2021, 3). Thus, we highlight the necessity to pay attention to specific lobbying rules in the general process of political decision-making in public policy.

Rules appear to be a key component for societies’ functions, and two fundamental questions arise concerning them. First, how transparent such rules are, and second, how transparent the process of their creation is. The focus thus far has mostly been on the existence or nonexistence of rules and their performance, whereas the public typically pays less attention to the process of rule creation and implementation. However, it is critical to understand how rules are formulated and who influences their creation to establish or change an institutional framework.

Institutional context directly affects the possibilities for economic growth and development (Scully 1988; Aron 2000; Borrmann, Busse, and Neuhaus 2006) and for effectiveness and efficiency (Chousa et al. 2005) while defining the range of benefits and costs of actors’ activities. Stakeholders want to influence the changes in institutions that could directly affect their interests and, conversely, to prevent changes if they are directed against those interests (see Coen 2007a, 2021; Bunea and Baumgartner 2014; Lowery et al. 2015).

The core of IQ evaluation is mostly built on rules. North has defined institutions as “rules of the game” (North 1990, 97) and states that institutions “are the constraints that human beings impose on human interactions” (North 1995, 15). In this article, we therefore focus on formal institutions, which are considered endogenous because they are chosen by members of society (Aghion, Alesina, and Trebbi 2002; Voigt 2013).

As a tool, rules promote a transparent and information-based environment. Transparency that is related to information includes timely disclosure of information (Bloomfield and O’Hara 1999), clarity of information (Bushman, Piotroski, and Smith 2004), accuracy of information (Granados, Gupta, and Kauffman 2006), and quality of the provided information (Churchwell 2003).

Transparency means citizens’ control over and information about policy (Knack and Keefer 1995), which is desirable, especially in situations of democratic deficits, and often accompanied by declining participation and trust (Fung, Graham, and Weil 2007). Grimmelikhuijsen and Welch (2012) identify three broad points that determine the level of government transparency, which Cucciniello, Porumbescu, and Grimmelikhuijsen (2017) later labelled as “transparency of activities”: a) transparency of decision-making processes; b) transparency of policy content; and c) transparency of policy outcomes or effects. Cucciniello and Nasi (2014) propose three widely investigated “objects of transparency”: a) financial or budgetary transparency; b) administrative transparency; and c) political transparency. Forssbaeck and Oxelheim (2015, 8) distinguish between transparency of policy content (information about the decisions made, the “substance” of a pursued policy) and procedural transparency (information about the processes whereby decisions are reached).

Cucciniello, Porumbescu, and Grimmelikhuijsen (2017) reviewed 187 studies on government transparency and used the findings of their analysis to outline an agenda for future research on government transparency and its effects, advocating more systematic investigations of how contextual conditions shape transparency outcomes. Here, there are two arenas of research on transparency: 1) the arena of decision-making as the core of political processes and politics and 2) the arena of public administration and management that is responsible for the implementation, realisation and provision of policies and decisions taken by the political arena. The reviewed studies thus illustrate that “there are some very clear benefits of transparency (e.g. for reducing public sector corruption) […] On the other hand, the relatively large number of mixed results for core transparency goals such as trust, legitimacy, and accountability suggests other benefits of greater transparency are less clear-cut” (Cucciniello, Porumbescu, and Grimmelikhuijsen 2017, 26). Decision-making processes, including the implementations and realisations of adopted policies, are often linked to promoting specific interests. Therefore, it is necessary to establish rules (i.e. with lobbying regulation) so that the whole process can be carried out transparently (for more, see the next chapter below).

More information (in terms of quality or intent) enables citizens and stakeholders to hold institutions accountable for their performance and policies. In general, a demand for accountability is often responded to by an increasing level of transparency (Bellver and Kaufmann 2005; Bovens 2007; Halachmi and Greiling 2013). When discussing whether transparency is an important prerequisite for implementing political accountability, it is essential to consider the mechanism for transferring information about governmental activities, which are required to be credible, complete, timely, comprehensible, and comparable, and the scope of changes in degrees of information asymmetry. According to Ramkumar and Shapiro (2011) or Lindstedt and Naurin (2010), there is a significant difference between making information available or truly accessible to the public; only accessibility can cause real, significant and fundamental changes in public administration to strengthen the political accountability, legitimacy and efficiency of governance (Heald 2003; Knack and Keefer 1995) while encompassing corruption control and bureaucratic quality (Bac 2001; Jetzek, Avital, and Bjørn-Andersen 2013, 17).

O’neill (2006) doubts if transparency actually has those desirable effects, since a transparency requirement can still fail if it is established as a “single standard [that] fits to all”, but she concludes transparency is still an antidote to opacity and secrecy. When asked what makes transparency policies effective, Fung, Graham, and Weil (2007, 16–17) show that the answer entails information provision in a convenient time and place and depends on the strength, motivation, and capacities of groups who influence the content of transparency policies.

A number of empirical assessments have found that transparency’s effects are often limited and differ according to a number of factors, such as area of government, policy domain, and citizen characteristics (Grimmelikhuijsen and Welch 2012; de Fine Licht 2014; Porumbescu 2017). Moreover, constant efforts to increase transparency do more harm than good, leading to polarisation, indecision and, ultimately, governmental dysfunction (Grumet 2014). Thus, Hood and Heald (2006) state that transparency should be considered a tool for achieving other goals rather than an intrinsic value. In systems where transparency is low, improvements are generally beneficial; on the other hand, in countries where transparency is high, further increases may conflict with privacy, legitimacy, autonomy, etc. The costs and benefits of transparency-enhancing measures therefore need to be weighed (see also Naurin 2007).

Naurin (2007, 3–4) empirically examines the presumed effects of transparency on policy-making processes – transparency should not be considered a fundamental right, and its effects are more uncertain than is usually assumed. Finally, deliberation theorists may be right about publicity and transparency, but once the applications of these concepts cross a certain threshold, the effect of increased publicity or transparency is negligible.

The connection between transparent decision-making and a transparent lobbying environment

Although the concept of liberal democracy anticipates lobbying activities, lobbying practices sometimes go beyond legitimate forms, can break rules, or unfairly influence political processes. For example, Gerber (1996, 264) shows that the influence of interest groups on representatives leads to deviations of policy outcomes from citizens’ preferences. Transparency – at least with respect to information regarding who is attempting to influence institutions and their representatives, why and how – is the key to ensuring a level playing field for decision-making processes while fostering democracy and citizen control.

Lobbying rules shed light on the aspects of a policy-making process that interest groups are involved in (Crepaz 2016, 232). Stiglitz (1999, 10) describes two traditional arguments for transparency in decision-making. First, opacity facilitates acting in nonpublic interests and hides mistakes. Second, special occasions permit public office holders to favour lobbyists with greater influence.

Many advanced democracies have engaged in broad discussions on the importance of implementing lobbying regulations in connection with transparency. Their main reasons are to reduce corruption risks, support a level playing field for stakeholders in policy-making processes, and allow the public to know whose interests guide politicians’ decisions. Moreover, transparent lobbying rules are useful tools for public officials to combat unethical lobbying activities. Vargovčíková (2011) and Holman and Luneburg (2012, 78–79) discuss additional arguments regarding the motivations and benefits of regulating lobbying to enhance transparency, which are beyond the scope of this paper.

Research on lobbying regulation has been increasing in recent years, generating comparative studies of national regulatory regimes, discussions of the theoretical frameworks and models of lobbying regulation and case studies of single jurisdictions. The most significant research includes the following: Opheim (1991); Greenwood and Thomas (1998); Graziano (2001); Kalninš (2005); McGrath (2008); Müller, Laboutková, and Vymětal (2010); Chari, Hogan, and Murphy (2010, 2019); Holman and Luneburg (2012); Greenwood and Dreger (2013); Crepaz and Chari (2014, 2018); Veksler (2015); Kwiatkowski (2016); Crepaz (2016); Bitonti and Harris (2017); Murphy (2017); Newmark (2017); Laboutková and Vymětal (2017, 2018); Crepaz et al. (2019).

One of the most complex ways to evaluate lobbying is to focus on the legal regulations for lobbyists/lobbying created by the Center for Public Integrity (CPI 2003, updated 2014). Chari, Hogan, and Murphy’s (2010, 2019) evaluation defines lobbyists and investigates the targets of lobbying, and the rules regarding registration, spending disclosures, electronic filing and public access to lists of lobbyists, as well as rule enforcement and revolving door provisions.

Existing assessments of lobbying rules primarily focus on the US institutional environment, which is different from that in Europe. In the EU, there is an ongoing debate about building more robust institutionalised regulatory models of lobbying that may represent various interests in terms of the equal access, accountability, and credibility of economic policy-makers and citizens’ trust in them.

A lobbying environment is essentially defined by its actors, their activities, and informal institutions; it is tightly connected with political decision-making. A lobbying environment might be shaped by the legal regulations of its actors and their actions and its rules for decision-making processes. To achieve a transparent lobbying environment, it is necessary to establish strong rules that fulfil transparency and efficiency requirements for all subjects in an industry and to conceptualise lobbying transparency in the broader scope of decision-making. To date, the literature lacks an authoritative assessment of the quality of a lobbying environment within the comprehensive scope of decision-making. Chari et al. (2019) recently extended the relevant evaluation methodology by including open government policy and certain elements of indirect rules, i.e. sunshine principles, specifically, the freedom of information, whistleblowing, and ethics reform. Transparent lobbying surpasses a single law; a broader approach that is based on openness, transparency, participation, and disclosure, which includes rules and regulations regarding conflicts-of-interest, publishing ministerial agendas, post-employment, the legislative process, and legislative footprints, should be introduced (Laboutková, Šimral, and Vymětal 2020). Typically, these are not directly incorporated in lobbying laws, but their origin is in the regulation of the behaviour of public office holders and public sector employees. Many countries do not have a standalone legal lobbying regulation (only 22 countries and the EU have introduced such regulation), but they do have other, already mentioned, indirect rules in place that are linked to lobbying. Transparency International's (TI’s) study of lobbying (2015) articulates an important message: The issue is much more complex because current legal frameworks for lobbying are often ineffective in terms of their transparency, i.e. there are many loopholes and enforcement is weak. TI thus recommends the introduction of other measures that can illuminate a decision-making process in general. Moreover, the empirical evidence from Central and Eastern Europe suggests that sunshine principles comprise the primary and most salient factors that affect transparency in a lobbying environment. Accordingly, in this study, we create the innovative catalogue of transparent lobbying environment (CTLE).

A transparent lobbying environment is inspired and influenced by the concept of good governance and new modes of governance (UNDP 2003, orig.1997; IMF 1997; AUSAID 2000; Héritier and Rhodes 2011; Coen, Katsaitis, and Vannoni 2021). The United Nations defines governance as “the process of decision-making and the process by which decisions are implemented (or not implemented)” (UNESCAP 2008). The most important aspect of good governance is procedure – governance involves ensuring that how policies are made is predictable and reviewable by relevant actors. Indeed, some of the fundamental principles of good governance, namely, transparency, participation, rule of law, accountability, responsiveness, consensus, equity and inclusion, efficiency, and effectiveness (APSC 2005; UNDP 2003; UNESCAP 2008), overlap and are interrelated. Thus, for example, transparency is a prerequisite for the accountability of public officials and the legitimacy of their decisions. Lindstedt and Naurin (2010, 304) argue that accountability is more a function of publicity than of transparency. Transparency also presumes that the information transferred is appropriately received and processed by stakeholders (Forssbaeck and Oxelheim 2015, 8). However, there is no automatic link between transparency and publicity. Lindstedt and Naurin (2010) thus conclude that transparency extends the probability for publicity if the information is relatively easily accessible or if the available information about political actions is not overlooked (Naurin 2007, 6). One relatively new tool that facilitates easy accessibility and accountability is open government data (OGD), a systematic and proactive publication of information, including mandatory information disclosures by lobbyists and lobbying targets about their activities.

Not only transparency but also integrity and fairness in decision-making processes are essential to protect the public interest. Integrity is the basis for building strong institutions and reassuring citizens that their government is working for their interests and not just those of a select few. According to OECD (2017), public integrity comprises the shared ethical values, principles, and norms that uphold and prioritise the public interest over private interests in the public sector (see Huberts 2018 for a broader discussion). Fairness in a political process is an ethical obligation to consistently and transparently consider the plurality of societal values, perspectives, and interests (Munda 2017). It is linked to the fundamental rule of equal access regarding the involvement of stakeholders in public decision-making, regardless of social status, gender, ethnicity, or economic power (Lauth 2016).

According to Crepaz and Chari (2018, 27), both “technological advancements and the growing complexity of lobbying environments have influenced the way governments seek to increase transparency and accountability in lobbying”. We have therefore divided our set of measures into four main categories: stakeholders – both 1) lobbyists and 2) targets of lobbying, 3) sunshine principles, which encompass the broader issues of decision-making processes; and 4) the area linked to monitoring lobbying activities and sanctioning rule breaches.

We believe that the measures included in the CTLE more accurately reflect the elements of transparency of a lobbying environment (listed in the short version, including the justification for each measure, in Table 1 and in full in Table S1).

Table 1. Catalogue of Transparent Lobbying Environment – short version

Category / number of indicators	Justification of the category of measures	Data, information	Measures and key elements of transparency
Lobbyists
Register (14)	to obtain basic information about lobbyists and lobbying activities	Registers of lobbyists/lobbying.	Public accessibility; Types of lobbyists regulated; Number of lobbyists registered vs. estimation of unregistered;
Codes of Conduct (8)	to avoid on unethical behaviour	Codes. Annual reports of lobbyists associations.	Bans on unethical dealings; Regulation of investigation in terms of breaching the Codes.
Disclosure of activities (9)	to shed light on lobbyists activities and allow public control	Declarations of lobbyists. Declaration of politicians and POH. Open calendars.	Timely published data on: what, who, why and whose interest is represented and list of clients; meetings, events, persons, matters, result; Electronically accessible for the public.
Targets of lobbying
Codes of Conduct (14)	to enhance integrity of public institutions for upholding and prioritizing the public interest over private interests	Members of Parliament. Ministers, Employees in the Civil Service.	Ban on paid (and unpaid) representation of interest groups; Declaration of conflict of interest before voting; Provisions for how to interact with lobbyists.
Revolving doors (7)	to enhance government accountability; to prevent POH from abusing their position for private interests to maintain integrity of the institution; to limit space for information trading	Internal rules of authorities.	Pre- and post-employment rules.
Conflict of interests (5)	to limit the space for possible abuse of position and office held	Conflict of Interest Acts. Manual for civil servants. Civil Service Act.	Obligations to declare assets; Basic rules on integrity; Independence of the central authority; Rules for gifts and hospitalities.
Disclosures of politicians/senior public employees (12)	to shed light on politicians/senior public employee’s activities; to enable public control; to narrow a space for potential conflict of interest	Civil Service Act. Appointment diaries.	Independence of the central authority from political influence; Timely published data on meetings, events, persons, matters, results; Electronically accessible for the public.
Sunshine principles
Rules on legislative process (17)	to inform who and how participate and intervene in the law-making process	Rules of procedures of chambers.	Bulletin/plan of legislative works.
Rules on decision-making (6)	to inform who and how participate and intervene in the decision-making process	Rules of procedures.	Obligation of public bodies to consult with citizens and other stakeholders before a decision is made; Equal access; Administrative footprint (from politicians’ electronic diaries).
Rules on consultations (10)	to inform who and how participate and intervene in the consultation process before a decision is made	Rules for consultancy.	Obligation of public bodies to consult with citizens and other stakeholders before a decision is made; Online platform for civic participation; Equal access; Request of a meeting with a politician/civil servant by email.
Legislative footprint (6)	to inform who has influenced a certain piece of legislation, how, and when; to improve accountability by allowing voters to monitor lobbying and legislative activities in real time	Lobbyists’ proposals accepted during the legislative process and disclosed records of contacts between lobbyists and public officials.	“Bill's birth certificate”. Information about meetings with lobbyists, including disclosure of interest represented; Time spent on the elaboration of laws.
Open Government Data (12)	to know how and in which quality government proactively provides information on governmental agendas	Public bodies’ websites. National Catalogue of Open Data. Open Data Barometer. Global Open Data Index.	Legal definition on open data; Data sources relevant for policy analysis; Proactive publication of information; Equal access to information and documents for all citizens.
Political parties funding (8)	to inform about income (donations, contributions) and spending (campaigns) of political parties	Political parties funding Act. Campaign financing rules	Transparent banking accounts; Donations by names; Online electoral funding; Disclosure of annual reports on the internet; Independent auditing mechanism; Account of all campaigns.
Freedom of information (10)	to inform about the level of freedom of information	Freedom of Information Act. Global Right to Information. Rating Centre for Law and Democracy.	Systematic monitoring of access to information; Explicit reasons for withholding information; Proactive disclosure; Providing information for re-use.
Monitoring and sanctioning system
Oversight (7)	to detect of misconduct behaviour	Lobbying Acts. Conflict of Interest Acts.	Body and/or mechanism for continuous monitoring of lobbying activities; Publicly available information; Bans on lobbying activities.
Sanctions (13)	to penalize detected misconduct behaviour	Lobbying Acts. Conflict of Interest Acts.	Administrative, financial and/or criminal penalties.

Source: Laboutková, Šimral, and Vymětal (2020, 86–99, 194–200).

The proposed set of measures in the catalogue reflects a transparent lobbying environment and includes 158 indicators divided into 16 groups. Most indicators (121) can be assigned one of three possible answers according to the existence of the measure: “yes”, “no”, or “partly”.

Additional detailed data covered by the 37 indicators extensively specify the relevance of the transparency measures (e.g. if a politician is obliged to disclose contact with lobbyists, then what type of information is disclosed? – the meeting place is less relevant than information about the lobbyist's client or the issue discussed, which are highly relevant); the measures entail specific documents, numbers, time periods and/or selections of all relevant types of responses that are suggested in the list.

Table 2 summarizes the results of lobbying assessments, according to the CTLE and CPI, for six Central and Eastern European countries. The selection of Austria, the Czech Republic, Hungary, Poland, Slovakia, and Slovenia is based on the argument regarding the long-term Habsburg legacy. When democracy in East-Central Europe resurfaced after six decades of fascist, pro-Nazi, and, with the exception of Austria, communist dictatorships, the common Habsburg cultural, historical, and political legacy also resurfaced. The inclusion of Austria in the set thus enriches the comparison of postcommunist experiences with a control case that has enjoyed democracy since the Second World War (Laboutková, Šimral, and Vymětal 2020, 17).

Table 2. Comparison of lobbying rules evaluation by CTLE and CPI

	CTLE (max. 121)	CPI (max. 100)
Austria	62,5 (52%)	38
Czech Republic	51,5 (43%)	0
Hungary	39,5 (33%)	0
Poland	65 (54%)	31
Slovakia	53,5 (44%)	6
Slovenia	76,5 (63%)	41

Source: Authors' calculation.

Regarding the CPI evaluation, countries with no legal lobbying regulations are automatically excluded from the assessment. However, there are also other measures and mechanisms for establishing a transparent lobbying environment (mentioned above) that the CTLE evaluates. Table 2 empirically demonstrates that our method of assessing the pro-transparency rules that affect lobbying in practice is better than previous methods. In addition, it is necessary to note a) the current situation in countries – most of them are not willing to introduce lobbying rules; b) that even if legal regulations exist, there are often insufficient or poor definitions for lobbyists, targets of lobbying, lobbying contacts, cooling-off periods, etc.; and c) instances of weak oversight and enforcement.

For comparison, we selected those measures from the CTLE that allow the yes-no-partly answer (121 questions/indicators mean 100%) and compared them to the CPI (48 questions/indicators mean 100%).

Countries that have legal lobbying regulations perform better in both approaches. However, those without legal lobbying regulations (the Czech Republic, Hungary, Slovakia) and that de facto fail the CPI assessment – scoring zero or almost zero – perform relatively well in the sunshine principles category. Sunshine principles alone can foster quality decision-making environments and make a difference across countries, regardless of whether they have any lobbying rules. Moreover, the CTLE methodological approach is more closely tied to the concept of good governance than the CPI.

Notably, a possible weakness of the CTLE is the number of monitored indicators within all 16 categories, which increases the potential error rate. One of the main reasons for the higher number of indicators is our desire to cover each stage of a decision-making process, i.e. a lobbying environment. This approach also requires the involvement of well-informed local experts in the field to complete all indicators, which increases the difficulty of obtaining data. However, it is necessary to obtain an accurate picture of the transparency of the decision-making environment in a given country. On the other hand, in practice, there are known composite indices with similar or even higher indicators; for example, the FH study on global freedom includes over 170 questions, and the v-Dem study includes over 480. Accordingly, the CTLE is not clearly different from these. Finally, all current indicators are weighted equally.

Institutional quality in the context of lobbying transparency

Institutional quality is a very broad concept that is applied in social science disciplines and various fields (encompassing quality of democracy, competitiveness, political freedom, economic freedom, doing business, etc.). Thus, we argue that both a better definition and a deeper understanding of the attributes of transparency in a lobbying environment will contribute to a more accurate assessment of IQ.

IQ is monitored based on various aspects of competitiveness, freedom, government performance and democracy. IQ assessments evaluate the elements related to public involvement in decision-making processes, as well as information and phenomena related to corruption. These assessments focus on components including citizen-related indicators (e.g. the capability of society/interest groups to comment on and influence pending policies/legislation or routine consultations of policy-makers with civil organisations), information-related indicators that reflect the relationship between citizens and public authorities (e.g. the availability/free access to information or the disclosure, clarity and accuracy of information) (Laboutková, Šimral, and Vymětal 2020, 62), and indicators that limit the opportunity space for corruption.

To evaluate IQ more accurately, it is necessary to scrutinise the quality of a decision-making process in terms of who and what influences the outcome of a decision and how and why. The proposed CTLE accounts for these requirements, specifically, the sunshine principles that are framed by the challenging principle of transparency, improve IQ, and strengthen democracy (Šimral and Laboutková 2021).

Table 3 presents the selected relevant sub-indicators for each IQ focus area (freedom, competitiveness, government performance, and democracy), which are related to lobbying and decision-making, and shows how they are reflected in the CTLE. Specifically, for each IQ topic, we selected just one representative report (Column 1), and then we identified the monitored areas that are associated with the decision-making process (Column 2) to demonstrate the interconnection between specifically related sub-indicators (Column 3) and specific indicators from the CTLE (Column 4). The number codes in Column 4 represent specific indicators in the CTLE: The first number is a code for the measure (16 groups), and the second is the number of specific indicators within each measure (see Table S1).

Table 3. Connections among the sub-indicators of institutional quality and the Catalogue of Transparent Lobbying Environment

Report/ Organization	Monitored areas associated with the decision-making process	Transparency of decision-making process – chosen related sub-indicators	Suitable categories of indicators from Catalogue of Transparent Lobbying Environment
Freedom House	Functioning of government on the basis of openness and transparency. Safeguards against official corruption. Rule of law.	Openness and transparency basically answers to the question “Does the government operate with openness and transparency?”	Lobbyists Register: 1-3, 1-4, 1-7, 1-8, 1-10, 1-11, 1-13 Code of Conduct: 2-6 Disclosure of activities: 3-1, 3-4, 3-5, 3-6, 3-7, 3-9 Targets of lobbying Disclosure of politicians and senior public employees: 7-all 12 indicators Sunshine principles Rules on legislative process: 8-5, 8-6, 8-7, 8-8, 8-9 Rules on decision-making: 9-2, 9-3, 9-4, 9-5, 9-6 Rules on consultations: 10-all 10 indicators Legislative footprint: 11-2, 11-3, 11-4, 11-5, 11-6 Open government data: 12- all indicators Political parties funding: 13-4, 13-5, 13-6, 13-8 Freedom of Information: 14-all 10 indicators Monitoring and sanctions Oversight: 15-3, 15-4
Global Competitiveness Report (World Economic Forum)	Transparency. Public-sector performance. Corporate governance.	E-participation is defined as “use of online services to facilitate the provision of information by governments to citizens information by governments to citizens (“e-information sharing”), interaction with stakeholders (“e-consultation”) and engagement in decision-making processes (“e-decision making”)”	Targets of lobbying Revolving doors: 5-7 Sunshine principles Rules on legislative process: 8-5, 8-6, 8-7, 8-9 Rules on decision-making: 9-2, 9-3, 9-4, 9-5, 9-6 Rules on consultations: 10-1, 10-2, 10-3, 10-4, 10-7, 10-8, 10-10 Legislative footprint: 11-2, 11-3, 11-4, 11-5, 11-6 Open government data: 12-2, 12-3, 12-6, 12-8, 12-9, 12-10, 12-12 Monitoring and sanctions Oversight: 15-3, 15-4 Sanctions: 16-6, 16-7, 16-8, 16-9, 16-10, 16-11
Sustainable Governance Indicators	Access to Information Rule of law. Steering capability Citizenś participatory competence. Legislative Actors’. Resources. Parties and interest associations. Independent Supervisory Bodies.	Expert advice basically answers to the question “Does the government regularly take into account advice from non-governmental experts during decision-making?” Summoning experts basically answers to the question “Are parliamentary committees able to summon experts for committee meetings?”	Lobbyists Register: 1-1, 1-3, 1-6, 1-7-, 1-8, 1-9, 1-10, 1-11, 1-12, 1-13, 1-14 Disclosure of activities: 3-1, 3-4, 3-6, 3-7, 3-8, 3-9 Targets of lobbying Revolving doors: 5-7 Conflict of Interests: 6-3, 6-4, 6-5 Disclosures of politicians and senior public employees: 7-1, 7-2, 7-3, 7-4, 7-6, 7-7, 7-9, 7-10, 7-12 Sunshine principles Rules on legislative process: 8-4, 8-5, 8-10, 8-11, 8-12, 8-13, Rules on decision-making: 9-5 Legislative footprint: 11-1, 11-2, 11-3, 11-4, 11-5, 11-6 Monitoring and sanctions Sanctions: 16-9, 16-10, 16-11
Democracy Index (Economic Intelligence Unit)	Electoral process and pluralism. Functioning of government. Political participation Democratic political culture. Civil liberties.	Functioning of government is answered by two relevant questions “Sufficient mechanism and institutions in place for ensuring government accountability.” and “Open and transparent functioning of government with sufficient public access to information.”	Lobbyists Register: 1-1, 1-2, 1-3, 1-6, 1-7, 1-8, 1-9, 1-10, 1-13, 1-14 Targets of lobbying Politicians’ and POHs’ Codes of Ethics: 4-all 14 indicators Revolving doors: 5-7 Conflict of Interest: 6-3, 6-4, 6-5 Disclosures of politicians and senior public employees: 7-all 12 indicators Sunshine principles Rules on legislative process: 8-1, 8-2, 8-3, 8-4, 8-5, 8-6, 8-7, 8-8, 8-9, 8-12, 8-13 Rules on decision-making: 9-1, 9-2, 9-3, 9-4, 9-5, 9-6 Rules on consultations: 10-1, 10-2, 10-3, 10-4, 10-7, 10-8, 10-9, 10-10 Legislative footprint: 11-1, 11-2, 11-3, 11-4, 11-5, 11-6 Open government data: 12-2, 12-3, 12-5, 12-7, 12-8, 12-11, 12-12 Political parties funding: 13-4, 13-5, 13-6, 13-7 Freedom of Information: 14-1, 14-2, 14-3, 14-4, 14-6, 14-7, 14-8, 14-9, 14-10 Monitoring and sanctions Oversight: 15-3, 15-4, 15-5 Sanctions: 16-5, 16-6, 16-8, 16-10, 16-11

Source: EIU 2019; SGI 2019; WEF 2019a, 2019b, Table S1, constructed by authors.

Conclusion

In this article, we have argued that a transparent environment is essential for institutional quality. Transparent lobbying contributes to a transparent decision-making process and thus the creation of inclusive institutions. Moreover, we have claimed that regarding the descriptions and analyses of lobbying rules and practices, a new and more comprehensive methodology that reflects the relations/interactions between “actors of influence” and “public office holders” must be developed. Accordingly, we have combined different forms of rules that respond to the broader problem of decision-making and are shaped by the challenging principle of transparency. Our study therefore provides the framework for a new way to evaluate lobbying transparency.

We have also argued that it is necessary to examine lobbying transparency by placing it in the wider context of decision-making processes for public policy. In the literature, measures to promote transparent lobbying are poorly conceptualized and have been explicitly included in the quality assessments of institutions.

Our approach offers a way to bridge the identified research gap, and its main findings are as follows:

1. The quality of a decision-making process, based on who is influencing and how it is influenced, is critical for institution-building and rule-making.

2. Current research on interest groups, particularly in Europe, highlights a significant tension between political legitimacy and the legitimacy of policy-making, leading to the need for a comprehensive approach that defines and assesses a transparent lobbying environment. The current evaluations of lobbying rules mainly reflect the US tradition of interest representation, which simply does not suit Europe.

3. It is necessary to comprehensively examine lobbying transparency within the broader context of decision-making processes. Therefore, we propose a catalogue of transparent lobbying environments and divide all measures into four categories – lobbyists, targets of lobbying, sunshine principles, and monitoring and sanctioning. The emphasis on implementing so-called sunshine principles entails an awareness of the need for a comprehensive approach to strengthen transparent decision-making; the regulation of lobbyists or targets of lobbying alone will not clarify the opacity of decision-making.

4. The common denominators of institutional quality and lobbying transparency are the indicators that relate to citizens and to information that reflects the relationship between citizens and public authorities and the indicators that limit the scope for corruption. These findings therefore suggest that a transparent lobbying environment plays a vital role in supporting some of the parameters of institutional quality.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This work was supported by Czech Science Foundation: [Grant Number No. 16-08786S Impact of Transparency of Lobbying on Democratization and its Consequences].

Notes on contributors

Šárka Laboutková

Šárka Laboutková, associate professor, a guarantor of Study Programme Economic Policy – Master Degree. She focuses on the theory of the impact of noneconomic factors on economic policy decision-making, lobbying, corruption, and institutional quality. She is a research team leader focusing on transparent lobbying in the EU funded by the Czech Science Foundation.

Petr Vymětal

Petr Vymětal – corresponding author, associate professor at the Masaryk Institute of Advanced Studies, Czech Technical University in Prague. He focuses on the decision-making process in political systems, corruption, institutional quality, lobbying, and political party financing. He collaborates with the NGO sector, namely, in the field of anti-corruption and democracy.