By Katie Jagel
23 April 2012
Harmonization of business practices was first introduced to the UN in 1977 within resolution 32/197 which resolved, “…measures should be taken to achieve maximum uniformity of administrative, financial, budgetary, personnel and planning procedures, including the establishment of [...] harmonized budget and programme cycles”. The idea made its resurgence as one of the five surviving clusters of the 2006 High Panel on system-wide coherence (SWC). In a 2009 outcome document from a joint meeting between the executive heads of UNDP, UNFPA, UNICEF, and WFP, it stipulates, “While simplification and harmonization of business practices in the UN system are not new initiatives, the urgency and momentum, the scope, and the approach are now new aspects of those initiatives.” ECOSOC has subsumed the initiative to a large degree, often with collaboration from the CEB, UNDG, and WFP, with progress shifting away from 'harmonization' and towards 'simplification' starting in 2010.
Introduction
The 2006 Panel recommended the Chief Executives Board (CEB) take initiative regarding the topic. Within the CEB, it was the High-level Committee on Management (HLCM) that took the reins. Those involved in the process consider business harmonization to be central to the overall SWC reforms because centralized management improves effectiveness and maintains progress achieved. Improving business practices helps improve efficiency, transparency, and accountability. However, much 'harmonization' comes from aspects of improved governance and funding (other SWC clusters), and is controversially overlapping in the mandate given to the General Assembly (GA)'s administrative and budgetary Fifth Committee. For all these reasons this last issue of the SWC has gotten less attention compared to the other four.
62nd Session: the Action Plan of the CEB
In April 2008, the CEB adopted a package of measures for the harmonization of business practices across the UN system. On 11 June they issued an 'Action Plan' purveying these measures, made at the request of Executive Heads of UN institutions. According to the HLCM website, the plan “looks at how the operations can be harmonized and strengthened throughout the UN system, between agencies in the areas of human resources, finance and budget, information and communication, and technology and procurement.” CEB briefed Member States on the plan for progress on June 13th, and responses and consultations followed.
The plan is based on the logic that investing in improved business practices in one area (like management of central resources, data exchange, or funding) acts as an investment in surrounding and dependent areas, setting off a virtual reaction chain of improvements. CEB Director, Adnan Z. Amin, and Chair of the HLCM Thoraya Obaid introduced the plan, which identifies six objectives for improving business practices: adoption of international standards and replication of best practices; facilitation of knowledge and resource sharing; enhanced transparency and accountability; enhanced public trust and engagement of stakeholders; facilitation of effective inter-agency coordination; and, achievement of efficiency gains. These would generate improvement in the UN's ability to deliver better, coordinated, and more flexible programmatic results. He then cites nineteen different UN projects that could implement these main objectives. The projects fell under four different thematic areas which included: human resource management, information and communications technology, finance and budget, and procurement. Some examples of projects are; reviewing and instituting common staff regulations, or an analysis of the International Public Sector Accounting Standards (IPSAS)1.
In the follow up Director Amin noted three general objectives of the plan: first, to improve accountability and reporting channels to Member States which would ensure the availability of easily accessible information through mechanisms like the IPSAS or standard data centers; second, to facilitate the operations of the UN country teams and ensure that they can provide the best support to their national partners; and last, to ensure strengthened programmatic performance through efficiency gains. The director made note that the goal of the Plan is to harmonize and simplify current UN practices, not to supplant current efforts of reform (implying both the Secretariat and the Fifth Committee). The plan would be led under a steering group led by the Vice-Chairperson of the CEB and was enlarged to include the Director of the CEB Secretariat and representatives of the UNDP and UNICEF. Financial support for the plan of action would be sought from all Member States.
Member States' statements were generally receptive and supportive of the work of the CEB. Many, however, were still worried about potential overlap in the 'Plan of Action' and mandates for the GA's Fifth Committee. In Cuba's statement on behalf of the JCC it stipulates that many issues addressed by the Plan of Action were already before the Fifth Committee and 'system-wide coherence discussions on business practice should not detract from, or infringe upon, the role of the Fifth Committee'. Russia echoed this concern. Some, like Switzerland and CANZ nations, believed that the CEB was in fact filling gaps in management architecture, not undermining current efforts. Co-chair and Deputy-Secretary-General Augustine Mahiga of Tanzania concluded that there was a general agreement to proceed with further consultations on the harmonization of business practices issues.
General Assembly Resolution 62/277 on system-wide coherence passed on 7 October 2009. It formally recorded the general support to proceed with the projects, and set harmonization of business practices on the agenda for the 63rd Session.
63rd Session: ECOSOC involvement
In early June of 2009 the 63rd Session convened under the two new co-Chairs of SWC, Ambassadors Kaire Mbuende of Namibia and Juan Antonio Yáñez-Barnuevo of Spain, along with the Secretary-General to discuss his last three notes on Gender, Governance, and Funding along with an Executive Summary from the co-Chairs on system-wide coherence. Compared to the three topics presented in concept notes, business harmonization got little attention from the Secretary-General, saying only that the best way to improve the system is with predictability of funding.
After these meetings the Economic and Social Council (ECOSOC) hosted “Simplification and harmonization of business practices” at its Operational Activities Segment in July 2009. In the resolution entitled: “Progress in the implementation of General Assembly resolution 62/208 on the TCPR” of July 2009, ECOSOC acknowledged, “progress is being achieved”, although many procedures require further harmonization, as identified in the 'Plan of Action'.
The GA Resolution on system-wide coherence 63/311 passed on 14 September 2009, and called “[...] on the Secretary-General, in cooperation with members of the United Nations System Chief Executives Board for Coordination, to continue progress in the simplification and harmonization of business practices within the United Nations development system, and requests the Secretary-General, in consultation with the United Nations System Chief Executives Board for Coordination, to regularly inform the Economic and Social Council about progress being made and challenges encountered in this regard and to refer any matter requiring an intergovernmental decision to the relevant intergovernmental bodies”. In this way, ECOSOC was now involved in the establishment of harmonization of business practices as well. It was thought that ECOSOC, the UNDP, UNFPA, UNICEF, and the WFP along with the HLCM (CEB) would be able to coordinate their efforts with their different mandates to jointly tackle the problem.
64th Session: UN Body Integration
A joint meeting then took place on 23 and 26 January 2010 between the Executive Boards of UNDP, UNFPA, UNICEF and WFP on “Harmonization amongst the UN Funds and Programmes: Business practices”. It effectively mapped progress made so far on the issue, and cited future challenges. Achievements included: the establishment of common premises and around 60 UN Houses; the adoption of a Harmonized Approach to Cash Transfers; and a common services program. The common services program resulted in several institutional tools and guidelines including the Operational Guidelines for the Implementation of Common Services, standard MOUs (memorandum of understanding, bi-lateral or multi-lateral joint agreements), and governance structures for Operational Management teams. The program also included a capacity-building program which would lead to the application of many administrative services at the country level. However, the meeting pressed for further integration within the UN System: “The potential in terms of increased efficiency and effectiveness of these past initiatives has not been fully realized in part because the initiatives did not include the involvement of the UN system as a whole.” Because of the UNDG's initiative taken with the harmonization of business practices, the transparency of their information, and involvement in the meeting, the CEB integrated the UNDG into its structure, along with HLCM and HLCP.
The outcome document presented future challenges under four categories: the external environment, business models and timelines, efficiency gains and transaction costs, and information sharing. In the 'External environment' category they recommended that the various UN organs must “align internal efforts” to relieve intrinsic tension. The diversity of mandates, stakeholder interests, and goals of organizations (or country policies) makes aligning organizations to common standards much harder. Secondly, for 'Business models and timelines' they stated that differences in business practices are usually a direct result of the differences in business models; differences in models are therefore a roadblock. A full overhaul in business models and a complete convergence in practices across the UN was cited as being neither likely nor desirable, but that simplification and coordination would be necessary. Because of the level of complication, size difference, and other restrictions, the timeliness of reforms for organizations would be different, ranging across a spectrum. Thirdly, 'Efficiency gains and transaction costs', the document impresses that simplification and harmonization of practices is built on the idea that increased coherence in the working modalities of organizations will contribute to an ability to deliver better program results and reduce costs in the medium and long term: “the gains must be weighed against the costs of achieving them.” These gains would be dependent upon financial regulations and rules which eventually “may require a governing body decision”. Fourth, and lastly, in 'Information sharing' it was specifically mentioned that data sharing needed to come hand in hand with “expectation management” and that feedback channels travel in both directions. “A sustained high-level commitment and communication that creates buy-in at the country level is needed to turn guidance and good intentions into concrete results.” They also mention that because of the long amount of time and the extended background work put into harmonization of business practices, it creates a risk for disappointment, but also needed pressure on the programs to yield short, medium, and long-term results.
GA plenary meetings to discuss harmonization of business practices were set for April and May of 2010. Both the JCC and the EU were vocal in the need for business reform across the UN but most of the potential solutions were discussed in overlap between governance, funding, and Delivering as One clusters. Once Resolution 289 passed, successfully delinking SWC issues, progress on harmonization of business practice reform continued at a steady rate.
65th Session: Reflection and Follow-up
In April through July of 2011 ECOSOC of New York and Geneva hosted substantive meetings on 'Simplification and harmonization of the United Nations development system'. The meetings were set in conjunction with a special report by the Secretary-General issued on 25 April 2011. The note listed and summarized milestones since the 2007 triennial comprehensive policy review (TCPR); analyzed the system-wide developments in 2010-2011 year; remarked on country-level perspectives, specified systematic challenges; and finished with conclusions and recommendations. Under future challenges he specified 'differences in business models', relative size of organizations, incentives for change, cultivation of leadership, inadequate resources, weakness in capacity, and the programme-operation divide as problems that would need special attention in the forthcoming years. In his conclusions, he re-iterated the joint meeting conclusions about 'realistic expectations' in how much businesses could be integrated into a common format. Rather than changing business models, he stated that States should give greater attention to simplification of procedures. He repeats that innovative funding mechanisms 'catalyze cooperation' at country levels. He reiterates that continuity via systematic changes must be pursued without staff or leadership changes affecting progress and that progress is neither top-down nor bottom-up but “a two way street”. He then concluded with several recommendations specifically for ECOSOC.
By July of 2011 ECOSOC had issued Resolution E/2011/L.35 which urged the United Nations system organizations to “identify and accelerate the implementation of those business processes that promise the highest return from simplification and harmonization, in compliance with relevant intergovernmental mandates.”
66th Session: QCPR
By late 2011 to early 2012 preparations were being organized for the 2012 quadrennial comprehensive policy review (QCPR) of the General Assembly. This is where the Funding, and Delivering as One initiatives will also take a major step. In late September 2011 ECOSOC put out a paper called “Preparations for 2012 Quadrennial comprehensive policy review of the General Assembly Assessing the costs and benefits of simplifying and harmonizing business practices of UN entities at the country-level”. This included a framework for an independent assessment of all UN programs having to do with simplification and harmonization of business practices. In its objective the document states that the proposed analysis “aims to provide programme country governments, UN entities and inter-agency coordinating bodies with sufficient analytical evidence to facilitate the development of strategies to accelerate the S/H [simplification and harmonization] of business practices at the country-level.” The part-survey part-analysis would cover the functional areas of procurement, finance, human resources, ICT, common premises and administrative services. Each of the program areas would then be subject to a cost/benefit analysis, which would in turn lead to application under one of three business models: first, individual agency provision, second, harmonized common services, and last, one business center. The spectrum of analysis under the different UN areas, and under the different business models is supposed to give the plan more flexibility and therefore, more realistic and accurate results, but also allowing for the different environments within which the programs work.
The HLCM portion of the CEB website in affirms, “A main concern of the HLCM is to harmonize and reform the Business Practices in the UN system. There are two criteria in which they will use to develop the project and with which to assess the priorities. First they must achieve efficiency and secondly, they must promote the concept of delivering as one on the country level.” One can see that although the SWC issues have become de-linked they are still inherently integrated efforts for efficiency and coordination.
- 1. Spoken about in greater detail in ‘Funding’ section
