May 6, 2021 – Close links between the defence industry and governments in Europe are jeopardising the integrity and accountability of national security decisions, according to a new report by Transparency International – Defence and Security.
Defence Industry Influence on Policy Agendas: Findings from Germany and Italy explores how defence companies can influence policy through political donations, privileged meetings with officials, funding of policy-focused think tanks and the ‘revolving door’ between the public and private sector.
These ‘pathways’ can be utilised by any business sector, but when combined with the huge financial resources of the arms industry and the veil of secrecy under which much of the sector operates, they can pose a significant challenge to the integrity and accountability of decision-making processes – with potentially far-reaching consequences.
This new study calls on governments to better understand the weaknesses in their systems that can expose them to undue influence from the defence industry, and to address them through stronger regulations, more effective oversight and increased transparency.
Natalie Hogg, Director of Transparency International – Defence and Security, said:
“When individuals, groups or corporations wield disproportionate or unaccountable influence, decisions around strategy and expenditure can be made to benefit private interests rather than the public good. In defence, this can lead to ill-equipped armed forces, the circumvention of arms export controls, and contracts that line the pockets of defence companies at the public’s expense.
“The defence and security sectors are a breeding ground for hidden and informal influence. Huge budgets and close political ties, combined with high levels of secrecy typical of issues deemed to be of national security, means these sectors are particularly vulnerable. Despite the serious risk factors, government oversight systems and regulations tend to be woefully inadequate, allowing undue influence to flourish, with a lot to gain for those with commercial interests.”
Transparency International – Defence and Security calls on states to implement solutions to ensure that their defence institutions are working for the people and not for private gain.
Measures such as establishing mandatory registers of lobbyists, introducing a legislative footprint to facilitate monitoring of policy decisions, strengthening conflict of interest regulations and their enforcement, and ensuring a level of transparency that allows for effective oversight, will be important steps towards curbing the undue influence of industry over financial and policy decisions which impact on the security of the population.
Notes to editors:
Defence Industry Influence on Policy Agendas: Findings from Germany and Italy is based on two previous reports which take an in-depth look at country case studies. The two countries present different concerns:
- In Italy, the government lacks a comprehensive and regularly updated defence strategy, and thus tends to work in an ad hoc fashion rather than systematically. A key weakness is a lack of long-term financial planning for defence programmes and by extension, oversight of the processes of budgeting and procurement.
- In Germany, despite robust systems of defence strategy formation and procurement, significant gaps in capabilities have led to an overreliance on external technical experts, opening the door to private sector influence over key strategic decisions.
The information, analysis and recommendations presented in the case studies were based on extensive document review and more than 50, mainly anonymous, interviews.
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The risks and impacts of inappropriate influence in the policy-making process, in which individuals or organisations try to persuade in favour of, or force their own agenda, are particularly significant in the defence and security sector. In this context, high levels of secrecy and complexity, combined with close relations between government, private experts, and the defence industry, converge to create a potentially fertile ground for private interests to thrive. Yet when individuals, groups or corporations wield disproportionate or unaccountable influence, this undermines the public good and public funds may be squandered.
This situation is further complicated by the different roles a government plays with respect to its defence industry, being simultaneously both the main customer and the main regulator. Because the government is reliant on the national defence industry for the fulfilment of one of its core obligations – providing defence and security for its citizens – it is easy to see how lines in the relationship between the two roles can easily become blurred. If unchecked, the influence of the defence industry can damage the integrity of state institutions and distort the aims of a national security strategy, while undermining market competition and good defence sector governance.
This paper presents the main findings from two case studies on the influence of the defence industry on the defence and security policy agendas of Germany and Italy. The aim of the studies was to identify pathways of potential undue influence and to make proposals for a more ethical relationship between the defence industry and policy-making entities. This paper provides a summary of the main findings from each study and presents a preliminary framework for understanding the factors that drive the exploitation of these pathways of influence.
New report warns close relationships and weak regulations leave door open to undue influence
28 April, 2021 – A close relationship between the defence industry and the Italian government jeopardises the integrity and accountability of the political decision-making process, according to new research by Transparency International – Defence and Security.
Released today, Defence Industry Influence in Italy: Analysing Defence Industry Influence on the Italian Policy Agenda details how defence companies can use their access to policymakers to exert considerable influence over defence and security decision-making in Italy.
The report, prepared by Transparency International – Defence and Security with the support of the Italian Coalition for Civil Liberties and Rights (CILD) and Osservatorio Mil€x sulle spese militari, invites the Italian government to understand better the weaknesses of its system such as to expose the decision-making process to undue influence by the defence industry, as well as to address them through more stringent regulations, more effective control and greater transparency.
In particular, Transparency International, Osservatorio Mil€x and CILD call on the Italian government to:
- Establish a process to publish and review a regular, clear and comprehensive national defence strategy with meaningful participation of different stakeholders including civil society.
- Introduce a new law to regulate lobbying and implement a mandatory stakeholder public register, with clear definitions and a public agenda of meetings between stakeholders and authorities, to allow full scrutiny.
- Widen the scope and applicability of ‘revolving door’ regulations to prevent conflicts of interest and reduce opportunities for undue influence
- Increase transparency in the export licensing process to allow for full and meaningful oversight.
Notes to editors:
- The full press release, in Italian, is available here.
- The report “Defence Industry Influence in Italy: Analysing Defence Industry Influence on the Italian Policy Agenda” was prepared by Transparency International – Defence & Security with the support of Italian Coalition for Civil Liberties and Rights (CILD) and Osservatorio Mil€x sulle spese militari.
- The report examines the structures, processes and legal regulations designed to ensure transparency and control based on 20 expert interviews. The report is part of an overarching study of the influence of the defence industry on politics in several European countries.
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This report examines systemic vulnerabilities and influence pathways through which the Italian defence industry may exert undue influence on the national defence and security agenda.
Compiled by Transparency International Defence and Security with the support of the Italian Coalition for Civil Liberties and Rights (CILD) and Osservatorio Mil€x, this report forms a case study as part of a project to analyse the influence of the arms industry on the defence and security agendas of European countries.
Expenses for armaments in Italy continue to increase with a projection of more than 6 billion euro for 2021, presenting a lucrative source of funding for the domestic defence industry. As such, there is an urgent need to identify and scrutinise the possible routes for undue influence in the Italian defence sector.
The report explores some of the most prominent opportunities for exerting influence on policy in Italy – through lobbying, political foundations, think tanks, the ‘revolving door’ and political financing – along with the vulnerabilities in the defence strategy formation and procurement process that expose the Italian system to undue influence.
Questo rapporto esamina le vulnerabilità sistemiche e i possibili percorsi attraverso i quali l’industria italiana della difesa può esercitare un’influenza indebita sull’agenda politica nazionale in materia di difesa e sicurezza. I governi e l’industria dovrebbero mitigare il rischio di influenza indebita, rafforzando l’integrità delle istituzioni e dei processi politici e migliorando il controllo e la trasparenza dell’influenza nel settoredella difesa. Redatto da Transparency International – Difesa e Sicurezza con il supporto della Coalizione Italiana per le Libertà e i Diritti Civili (CILD) e dell’Osservatorio Mil€x, questo rapporto costituisce un case study nell’ambito di un progetto di analisi dell’influenza dell’industria degli armamenti sui programmi di difesa e sicurezza dei paesi europei.