Municipality Integrated Reporting model: The Famous Istanbul District, Kadıköy adopts integrated reporting

A sustainable and more livable world depends on good governance of our resources as well as our collective needs and demands. The legitimacy of governments is built on the trust they earn from their citizens. Governments cannot function effectively without it. It is a necessary condition for governments to successfully carry out public policies. Citizens have the most frequent interaction with their governments at the local level. Grassroots of democracy and participation is local. Therefore, good governance of municipalities is critical to earn the trust of citizens which has multiple benefits:

Trust encourages individual behaviour that supports desirable policy outcomes. Citizens who trust their government will have higher trust in programs and policies.
Citizen who trust their governments will be ready to share their needs, requirements, views and innovative ideas in policy development cycle which means improved participation.
Trust also improves compliance with rules and regulations (and reduces enforcement costs). Citizens who trust their government to create policies and programs aligned with the public good are more likely to be willing to put their immediate self-interest aside.
Social capital is built on trust. A government that stands for trust encourages interpersonal trust and reduces the transaction costs of doing business across the economy, raising productivity and competitiveness.
Trust increases confidence in the economy by reducing the perception of risk that inhibits investment and other business decisions that generate wealth and jobs.
A high-trust environment helps governments implement reforms with long-term benefits. For citizens to forsake short-term interest for long-term gains requires trust in the government’s capacity to identify needs and conceive and execute policies that will deliver the promised results.
Progress on the Sustainable Development Goals that require collaboration of public, private and civil institutions can only be achieved in a high-trust environment.

Last year, Argüden Governance Academy[1] has developed and published a citizen-centric Municipality Governance Scorecard© for Istanbul District Municipalities with an intention to improve good governance and sustainability efforts at local level. After the first implementation for the Istanbul district municipalities, the Scorecard has attracted attention from the UN, OECD, the Council of Europe, and the European Union (EU).

The findings generated with the Scorecard indicated the importance of integrated thinking between different departments, sectors, and levels if optimum outputs to be produced at local level for both sustainability and well-being. Data-based, participatory, integrated decision-making processes were identified as the focal point for improving local good governance and sustainability actions.

These findings led to the agenda of taking the integrated reporting approach to local level. Upon the request of Kadıköy district municipality in Istanbul, ARGE Consulting, developed a Municipality Integrated Reporting Model© and helped the Kadıköy Municipality utilise this Model as a pioneer to prepare its integrated reporting. The Model integrates the OECD’s better life index approach with the SDGs and the EFQM’s continuous learning model to develop a Municipality Integrated Reporting Model© for municipalities. The aim of the Model is to improve; value creation for all stakeholders and inclusive policy making in local level.

The model focuses the key decision criteria as outcome (or impact which is quality of life) as well as measuring outputs. Improving quality of life of citizens needs to be the main goal of a municipality.

Integrated thinking helps build trust by improving effectiveness of resource utilisation and value creation.

The likelihood of success improves when an organisation;

Aims to create value for itself and its key stakeholders,
Considers the concerns and priorities of different internal and external stakeholders,
Analyzes the adequacy of existing resources in multiple dimensions and decision-making processes to reach its goals,
Determines the needs for new resources and approaches to achieve its targets.

Benefits of implementing an integrated thinking approach and preparing an integrated report for a municipality are the following:

Agenda Setting

Determination and prioritisation of needs, demands, requirements, and issues through a democratic participatory process
Alignment of short, medium, and long-term policy issues
Alignment of priorities and perspectives of stakeholders’ and municipalities
Supporting evidence-based policy development and problem solving. Issues that need to be dealt with at central government level could be handled in an evidence-based manner to the government.

Decision Making

Supports evidence and data-based decision making.
Improves inclusiveness and opens the way for participatory and fair decision making for all
Aligns global, national, and district’s priorities in decisions, developments, and policies
Brings stakeholders’ understanding to common ground by improving understanding of each other’s needs, concerns, and expectations which in turn improves citizen satisfaction.

Resource Management

Resource allocation could be made based on impact assessment and science-based analysis.
Allows allocation of resources according to short, medium- and long-term targets.
Improves efficiency and effectiveness of investments and alignment with local concerns

Capacity Building

Improves performance and quality of decision making by improving coordination and collective decision making in all levels of municipal structure.
Improves the institutional capacity and builds culture for improved stakeholder engagement and relations.
Reduces citizen complaints by incorporating their concerns into the planning process and provides an open culture to increase transparency and reduce complaints.

Monitoring

Provides a framework for measuring impacts created by outcomes of municipal services.
Provides monitoring systems to analyse deviations by data based methodologies.
Maximizes the utilisation of effects of positive outcomes produced through municipal actions.
Presents meaningful information in communications with stakeholders.
Improves risk management capability.

Citizen Satisfaction

Improves satisfaction through focusing on stakeholders’ short, medium and long term needs, requirements, and expectations.
Helps to create value in a fair and inclusive manner.
Guides municipalities to establish close, effective, and efficient relationship with stakeholders.
Improves trust to municipality by presenting concise and clear information that improves accountability.

Quality of Life

Supports capacity building in local level (at municipality and community) to improve quality of life by taking in to consideration of ecological, physical, social, and economical factors. This could enable to follow improvements in quality of life throughout years.
Creates opportunity and trust for Private Public Partnerships and encourages effective utilisation of resources.
Creates an opportunity to utilise national and international opportunities to improve quality of life in the district.
Participatory and inclusive decision-making processes improves quality of decision making which would also improve satisfaction and quality of life.

Kadıköy’s pioneering integrated report that uses this Model may be reached by clicking this link.

[1] Argüden Governance Academy is an Istanbul based Foundation who is dedicated to improve governance quality in public, non-profit, private, and international organisations to create sustainable value for institutions and society.