Introduction: Why Study Compliance? Why Study g8 Compliance?

Every year since the Lyon Summit in 1996, the University of Toronto’s G8 Research Group has conducted compliance studies as an important part of the analysis it produces. Why do we embark on this task every year? What is it we and the world derive from our efforts?

The G8 Summit annually produces a series of written, public communiqués or declarations used at the summit that bind the leaders in many cases to hard commitments. Can the impact of these commitments be measured once the Summit is over, the media have dispersed and the leaders have returned home? Are there limits to how much or how often the G8 can comply with their Summit commitments, particularly given that they are autonomous, sovereign states whose leaders are driven by differing domestic and international demands?

It makes little sense for G8 leaders to invest their time and resources, while potentially risking their political and personal reputations, to generate these agreements if they have no intention of complying with them once the Summit is done. Our compliance reports therefore allow us to assess how much credibility the leaders bring to the Summit table, and whether the products of the Summit (communiqués and declarations), deserve to be treated with any attention or seriousness at all.

The empirical findings on compliance therefore offer explanations to three important questions:

1. To what extent and under what conditions do G8 members live up to the commitments, those are the collective decisions that the leaders reach or authorize at the Summit?

2. How does the pattern of Summit compliance vary over time by issue area, and by member?

3. What causes high and low Summit compliance?

Determining how much compliance has happened, when, where and by which country, allows one to draw some important conclusions about the overall effectiveness of the Summit process. But before one can describe and explain patterns of Summit compliance, one must first define what is meant by a commitment, since commitments form the basis of the compliance assessments.

Why Study g20 Compliance?

The G20 Research Group has conducted compliance analysis on G20 commitments since the 2008 Washington D.C summit when the summit transitioned from the ministerial level to the leader’s level summit. The G20 was created in 1999 as a meeting of finance ministers and was elevated to a meeting of leaders in the wake of the 2007 US-turned-global financial crisis. Even though the G20 ministers produced a communiqué at the end of each meeting, the G20 Research Group along with its partners started producing compliance reports on each G20 communiqué starting with the 2008 Washington Summit.

What are g8 and g20 Summit Commitments? How to Define and Identify Commitments from the g7/8 and g20 Communiqué

Commitments are defined as a discrete, specific, publicly expressed, collectively agreed to statements of intent; a “promise” or “undertaking” by summit members that they will undertake future action to move toward, meet or adjust to meet an identified welfare target (Kokotsis 1999). There are several key criteria contained in this definition.

First, commitments must be discrete, in that each specified action represents a separate commitment even if multiple actions will all help reach one target or aim. Each specific action represents a separate commitment, which is often defined by a given target. Many statements in summit documents specify both a policy instrument and a corresponding welfare target. For example, the following statement consists of two separate policy instruments and one welfare target.

“We pledge to reduce our dependence on imported energy (welfare target) through conservation (policy instrument #1) and the development of alternative energy sources (policy instrument #2).”

This statement classifies two discrete commitments because it contains two measureable instruments, even though there is one shared welfare target.

It is not necessary to extract a policy instrument and a corresponding welfare target in every case. A welfare target can be classified as a commitment without specifying a policy instrument, and a policy instrument or action can be classified as a commitment without specifying a welfare target. A target or instrument/action can be implied or inferred. It may also be specified in past statements. When identifying the issue area and assessing compliance for these commitments it is critical to take this into consideration.

What is a welfare target in one instance may be an instrument in another and vice versa. For example, the G8 might commit to reducing greenhouse emissions (instrument) to tackle climate change (target). For example, in 1990, the following commitment was made: “Climate change is of key importance. We are committed to undertake common efforts to limit emissions of greenhouse gases, such as carbon dioxide.” In another instance the G8 might commit to setting targets (instrument) to reduce greenhouse gases (target). For example, in 1998, they made the following commitment: “we will each undertake domestically the steps necessary to reduce significantly greenhouse gas emissions;”

A commitment can only exist if it is specified in a communiqué or G8/G20 leaders statement. It is not appropriate to create a commitment simply on the basis that it is implicit due to the existence of a corresponding policy instrument or welfare target.

The discreteness test is important in determining how many commitments fall under one statement. The question the coder must ask him/herself when determining whether one or more commitments should be identified in a statement is: “Would I use different data or evidence to determine compliance for this/these commitments?”¹ If the answer is yes, then they represent separate commitments. If the answer is no, then it represents a single commitment. The paragraph from the G20 Seoul Summit below, for example, actually contains ten commitments (1. “we have agreed to work further on macro-prudential policy frameworks; 2. better reflect the perspective of emerging market economies in financial regulatory reforms; 3. strengthen regulation and oversight of shadow banking; 4. further work on regulation and supervision of commodity derivatives markets; 5. improve market integrity and efficiency; 6. enhance consumer protection; 7. pursue all outstanding governance reform issues at the IMF and 8. World Bank; and 9. build a more stable and resilient international monetary system, including by further strengthening global financial safety nets. 10. We will also expand our MAP based on the indicative guidelines to be agreed.”).

“Building on our achievements to date, we have agreed to work further on macro-prudential policy frameworks; better reflect the perspective of emerging market economies in financial regulatory reforms; strengthen regulation and oversight of shadow banking; further work on regulation and supervision of commodity derivatives markets; improve market integrity and efficiency; enhance consumer protection; pursue all outstanding governance reform issues at the IMF and World Bank; and build a more stable and resilient international monetary system, including by further strengthening global financial safety nets. We will also expand our MAP based on the indicative guidelines to be agreed” (The G20 Seoul Summit Leaders’ Declaration 2011).

Second, commitments must be sufficiently specific and the target needs to be both identifiable and measurable. Actions need to include changes in members’ behaviour. General statements of aspiration are excluded, while statements with specified parameters are included.

When assessing the summit’s communiqués and declarations, the following points are helpful in determining how to identify measurable commitments:

Commitment = “…commit…” “…agree...” “…pledge…” “…seek…” “…reaffirm commitment...” “…create…” “…will…” “…insist on…” “…renew…” “…stand ready to…” “… support…” “…remain determined”

No Commitment = “…welcome…” “…encourage…” “…reflected upon…” “… discussed…” “… are aware…” “…look forward to…” “…emphasize…” “…recognize the importance of…” “…we gave particular emphasis to…” “…call on…” “…urge…”

However, there are no hard and fast rules when it comes to the wording of a commitment. A statement that uses the term “pledge” or “commit” is not necessarily a commitment if it is not measurable to the extent that the “measurability rule” is satisfied. It is important to note that it is not always necessary for a commitment to be numerically or quantitatively measurable (although “quantitativeness” is generally sufficient to ensure the “measurability test” is satisfied). Non-quantitative statements such as the following should be classified as a commitment:

“We look to an orderly and fruitful increase in our economic relations with socialist countries as an important element in progress in détente.”

It is also critical to take the context of the summit and the statement into consideration. For example,

“We recall our strong commitment to the sovereignty, independence, territorial integrity and national unity of Libya” (G8 Deauville Summit 2011)

is a commitment because at the time of the 2011 Deauville Summit the leaders were reaffirming their support for this initiative (G8 Deauville 2011). However, ‘recall’ will not always indicate a new commitment. It can be used to highlight a past, as opposed to future, actions and therefore does not fit into the commitment criteria.

Many statements in the communiqué use the verb “should.”

“Our capacity to deal with short-term oil market problems should be improved, particularly through the holding of adequate levels of stocks.”

In real life, “should” does not always imply intent. When coding Summit documents, however, it often can imply a commitment to do what is specified. Hence, “should” statements can be classified as commitments if they meet the other appropriate criteria. Each “should” statement should be assessed individually to determine if it is a commitment.

Third, commitments must be future-oriented, rather than represent endorsements of previous action. However, reaffirmations or pledges to continue an action are included, because they indicate a bound pattern for future action. They rest on an assumption that in the absence of summit reaffirmation or re-articulation each year, they would normally expire (or be taken less seriously and dwindle).² Excluded are actions or decisions that the summit members “welcome.”

Fourth, while action by summit members is assumed to be required in the future, this does not need to be specified. It is assumed by the tense used.

Finally, who is “we”? The G8 and the G20 often state that international institutions or groups other than themselves should take a particular course of action. If it is understood to mean that the G8 and G20 countries will try to pressure for a course of action from within the institution they are part of, then this entails a commitment. If they are simply giving a suggestion to another country or institution to which they do not have sufficient influence over, then it should not be coded as a commitment. The individual members of the G8 or G20 need to take action.

Example: This is a commitment:

“We are committed to a shift in International Monetary Fund (IMF) quota share to dynamic emerging markets and developing countries of at least 5% from over-represented countries to under-represented countries using the current quota formula as the basis to work from.” (Pittsburgh G20 2009).

Example: This is not a commitment:

Trade plays a key role in development. We encourage the developing countries, especially the newly industrializing economies, to undertake increased commitments and obligations and a greater role in the GATT, commensurate with their importance in international trade and in the international adjustment process, as well as with their respective stages of development.

Note: If the G8 or the G20 specifies a carrot and/or stick (e.g. structural adjustment as a condition of debt-restructuring) with which they will influence other countries, then this is typically sufficient to justify a commitment. E.g. “The industrialized economies will open up their markets as part of structural adjustment. Debt-relief will be provided on the basis of them doing so.”

The G8 Research Group and the G20 Research Group identifies commitments based on the aforementioned criteria. An individual or group of individuals identifies the commitments from the G8 and G20 leaders’ documents. Ministerial documents and working group documents are not included.