The OECD’s Recommendation on Policy Coherence for Sustainable Development (PCSD) underlines the critical need to align actions across sectors and levels of government to advance sustainable development. Enhancing policy coherence effectively entails robust whole-of-government co-ordination and a clear, strategic long-term vision. Although OECD countries have taken steps to enhance PCSD, challenges remain in strengthening policy integration and impact assessment.
Whole-of-government co-ordination is needed in order to promote mutually supporting policies across environmental, social and economic sectors for sustainable development. OECD countries have made strides in this direction. For example, 15 out of 24 OECD countries with data available (63%) report having formal governance arrangements for effective communication between ministries and departments. These arrangements include inter-ministerial working groups and networks, focal points, councils, and interdepartmental commissions, many of which are dedicated to sustainable development or Agenda 2030. However, only 3 out of 24 countries (13%) report having established clear mandates to enhance policy coherence and mitigate divergences between sectoral policies (Figure 5.1). Strengthening capacity to resolve policy conflicts helps to minimise trade-offs between sectors and optimise resources in pursuing sustainable development.
As well as whole-of-government co-ordination, achieving sustainable development also requires effective policy integration to ensure that sustainability considerations are embedded into all areas of governance. To this end, OECD countries have made efforts to better incorporate sustainable development into policies and finance. The most common mechanism for policy integration is the use of measures to ensure that planning documents reflect their contribution to sustainable development, reported by 19 out of 24 OECD countries (79%). However, just one-third of the countries (8 out of 24) report using the budgeting process as a tool to integrate sustainable development into policy making (Figure 5.2). Strengthening the strategic use of policy planning mechanisms and tools, such as the budgeting process, can enable governments to make better use of synergies and benefits across economic, social and environmental policy areas as well as across domestic and internationally recognised Sustainable Development Goals.
However, a key factor limiting improvements in policy coherence is the absence of institutional mechanisms for detecting policy conflicts. To address this, the PCSD Recommendation calls on countries to analyse and assess the impacts of policies on sustainable development. This should include the consideration of long-term and transboundary impacts to ensure that domestic efforts do not undermine prospects for sustainable development in other countries or for future generations. Currently, 14 out of 24 OECD countries (58%) report using long-term planning tools, such as strategic foresight and scenario development, to support the development of a long-term strategic vision. However, only 4 out of 24 countries (17%) report using impact assessment tools to assess the transboundary impacts of policies. This low number is partly due to insufficient data and evidence-based information needed for such assessments. Political considerations also play a role. Only 4 out of 24 OECD countries (17%) report including the impacts of policies (or PCSD issues) in information provided to ministers or parliament (Figure 5.3). This suggests that improving PCSD will require greater political ambition to assess and address policy impacts and conflicts (OECD, 2024).
