Governments should renew their efforts to better design, deliver, and review regulation and regulatory processes, according to a new OECD report.
The Regulatory Policy Outlook 2025 - the OECD’s flagship publication on drafting laws and regulations, their implementation and review - highlights the efforts governments are making to advance policy objectives while adapting to rapid technological change and evolving policy environments. It identifies opportunities to reduce unnecessary regulations, while ensuring regulatory frameworks are focused on better outcomes for people, and contribute to a policy environment that supports innovation and strong and sustainable growth.
Regulations are often seen as burdensome for citizens and businesses, while their weak enforcement can raise concerns about government effectiveness in protecting people and the environment. Governments must renew efforts to design and review rules and build trust, the report said.
“To navigate today’s complex policy environment, with fast technological changes and growing demands for efficiency and effectiveness, governments need to ensure that regulatory frameworks are adaptive, efficient and proportionate to underlying policy objectives,” OECD Secretary-General Mathias Cormann said. “By tackling unnecessary regulations, and ensuring regulatory frameworks are focused on better outcomes, governments can contribute to a supportive policy environment for stronger and more sustainable growth. This fourth edition of the Regulatory Policy Outlook provides evidence-based recommendations for developing best practice regulatory frameworks to achieve these objectives.”
New analysis shows that OECD Members have made good progress toward improving stakeholder engagement, particularly by using digital platforms, extending consultation periods, and enabling the public to provide evidence on both the anticipated and actual impacts of regulations. However, there is room for improvement. Only 33% of OECD countries provide direct feedback to stakeholder engagement, missing the chance to make interaction more meaningful and encourage future participation. Broader consultations are also needed to ensure inclusivity and reduce concerns around undue influence.
Regulations are more likely to be effective when based on sound evidence. Governments have improved evidence-based decision making, requiring an examination of more social and environmental considerations alongside economic ones when using tools such as regulatory impact assessment. These efforts should continue and be followed by effective implementation of regulations, the report said.
Current regulatory frameworks often lag behind technological progress, and struggle with overlapping jurisdictions, legal fragmentation, and outdated rules. To better support innovation while managing risks, governments must embrace adapt and learn from experience to improve anticipatory governance, while also strengthening co-operation and co-ordination across authorities. The use of strategic intelligence tools like horizon scanning and strategic foresight can also help anticipate and mitigate risks, ensuring rules stay relevant and effective even as circumstances change.
Most OECD countries have scope to further support compliance and desired outcomes by adopting risk-based analysis. This would allow enforcement resources to be focused on where non-compliance would have the greatest impact, saving both businesses and government time and resources, while maintaining positive outcomes. However, less than 50% of OECD countries currently allow regulators to base enforcement work on risk criteria.
Significant challenges remain in implementing governments’ commitments to environmental protection while preserving economic growth. Only 21% of OECD Members review rules with a “green lens” of environmental sustainability across sectors and the wider economy. Deepening such reviews to consider the local and broader impact of pollution, carbon emissions and biodiversity is critical to ensure that regulations actively support the green transition.
To achieve meaningful environmental outcomes, governments should streamline the complex patchwork of rules with environmental objectives, viewing them as a system, reducing unnecessary regulatory burdens including across borders, prioritising risk-based regulation and focusing enforcement efforts on areas where the greatest risks to the environment exist.
To access the report, data, and summary, visit: https://www.oecd.org/en/publications/oecd-regulatory-policy-outlook-2025_56b60e39-en.html.
For further information on OECD work on regulatory policy, visit: https://www.oecd.org/en/topics/policy-issues/regulatory-reform.html.
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Working with over 100 countries, the OECD is a global policy forum that promotes policies to preserve individual liberty and improve the economic and social well-being of people around the world.