Editing Aid effectiveness (section)

====Improving aid transparency and mutual accountability of donors and recipients====
Some believe that the way to improvement is through better monitoring and evaluation, increased transparency, accountability and learning. For instance, Stefan Schmitz, a former senior aid official in the German government and the OECD, has argued that reporting duties, results-orientated action and ongoing performance assessments are essential for the sake of aid effectiveness, but political will must be already there for this to happen.<ref>{{Cite web|title=Comprehensive thinking|url=http://www.inwent.org/ez/articles/167079/index.en.shtml|url-status=dead|archive-url=https://web.archive.org/web/20100706045452/http://www.inwent.org/ez/articles/167079/index.en.shtml|archive-date=2010-07-06|access-date=2010-03-11}}</ref>

The Accra Agenda for Action states that transparency and accountability are essential elements for development results, as well as drivers of progress.<ref>OECD, "The Accra Agenda For Action", 3rd High Level Forum on Aid Effectiveness, September 4, 2008.</ref> Mutual accountability and transparency is one of the five partnership commitments of the Paris Declaration.<ref>OECD, "The Paris Declaration on Aid Effectiveness". March 2, 2005.</ref> Through 'transparency', donors and recipients can be held accountable for what they spend and aid can be made more effective by knowing the three Ws of transparency:
* Who gives money to which recipient?
* What project is being funded and for what purpose? and
* Where?<ref>Kharas, H., "Transparency: Changing the Accountability Engagement, and Effectiveness of Aid", in: Kharas, H., Makino, K., Jung, W., "Catalyzing Development", Brookings Institution Press, Washington, D.C. 2011.</ref>

Transparency offers a valuable answer to insecurity, making aid "predictable" and "reliable". Transparency has been shown to improve service delivery and to reduce opportunities for diversion and therefore corruption.<ref>Bjorkman, M., Svensson, J., "Power to the People: Evidence from a Randomized Field Experience on Community-Based Monitoring in Uganda", ''Quarterly Journal of Economics'' 124, no. 2: 735-69, 2009.</ref>

Transparency can be defined as a basic expression of mutual accountability.<ref>Mary Robinson’s definition, in the OECD Survey on Monitoring The Paris Declaration, 2008.</ref> Mutual accountability can only work if there is a global culture of transparency that demands provision of information through a set of rules and behavioral norms, which are difficult to enforce in the case of official development cooperation. In particular for emerging economy donors and private development assistance, these norms are only at a nascent stage. Kharas<ref>See Kharas, H., "Transparency: Changing the Accountability Engagement, and Effectiveness of Aid", in: Kharas, H., Makino, K., Jung, W., "Catalyzing Development", Brookings Institution Press, Washington, D.C. 2011.</ref> suggest to adopt the "regulation through information" approach,<ref>Majone, G. "The new European Agencies: regulation by information", ''Journal of European Public Policy'' 4, no. 2: 262-75, 1997.</ref> which has been developed and has proven its effectiveness in the case of the European integration. In fact, at the international level, when the enforcement of mandatory rules is difficult, the solution could be to provide and make available transparent, relevant, accurate and reliable information, which can be used to reward or sanction individual aid agencies according to their performances. This means establishing a strong culture of accountability within aid, which rewards aid successes but penalizes failures.

To achieve this, literature on the topic<ref>See, for example, Pranay, S., and Hubbard, M., "A Future for Aid Data: Research towards a South-South Cooperation Data Categorization to complement on-going IATI Categorizations’", ongoing research, DFID Future of Aid and Beyond Research Competition 2010-11, 2011.</ref> suggest that donors should agree on adopting a standardized format for providing information on volume, allocation and results, such as the [[International Aid Transparency Initiative]] (IATI), or other similar standards, and commit to improve recipient countries' databases with technical, financial and informational support. The format should be easily downloadable and with sufficient disaggregation to enable comparison with other data. Making aid data public and comparable among donors, would be likely to encourage a process of positive emulation towards a better usage of public funds.  After all, [[official development assistance]] (ODA) is a voluntary transfer that depends on the support of donor country taxpayers. Donors should therefore consider improving the transparency and traceability of aid funds also as a way of increasing engagement and support toward aid inside their own country. Moreover, a generalized adoption of IATI would ensure the publication of aid information in a timely way, the compatibility with developing countries' budgets and the reliability of future projections, which would have a strong and positive effect on the predictability of aid.<ref>Kharas, H., Makino, K., Jung, W., "Catalyzing Development", Brookings Institution Press, Washington, D.C. 2011.</ref>

Finally, to improve accountability while building evaluation capabilities in aid recipient countries and systematically collecting beneficiaries’ feedback, different mechanisms to evaluate and monitor transparency should be considered, such as independent third-party reviews, peer reviews or mutual reviews.<ref>See Droop, J., Isenman, P., and Mlalazi, B., "Mutual accountability in Aid Effectiveness: International-Level Mechanisms", Briefing Note, n.3, Oxford Policy Management, 2008.</ref>