OECD Regulatory Policy Outlook 2025

Governments worldwide are facing multiple challenges that require government action -- in some cases requiring regulation. But regulating must be done efficiently and effectively. This is a field where smarter, simpler and more streamlined are keywords for action. In a fast-changing environment like that of today, regulations in many areas are considered unduly burdensome for citizens and businesses. In others, the weak enforcement of rules is raising questions about the ability of government to act effectively and protect citizens, consumers and the environment. In this context, renewed government efforts are needed to better design, deliver, and review rules to help unleash potential for all while addressing societal risks. This strengthened but smarter rule making will be decisive not only for designing and implementing good policies, but also for improving trust in government.

This fourth edition of the OECD Regulatory Policy Outlook examines how regulatory reform can support the delivery of more effective rules for people, the planet and the future. The Outlook also provides country profiles that track recent progress and highlight areas for further improvement in OECD Members’ regulatory systems and processes.

Governments regulate both for and with people: they regulate to protect people from harm and with them to improve the quality of rules. Involving people in the rule-making process leads to better rules, and promotes a greater understanding of regulatory goals which in turn boosts public buy-in and improves compliance. This report notes a positive trend as governments continue to improve their stakeholder engagement practices, such as increasingly using digital means to call on the public to provide evidence on impacts of rules. In addition, OECD Members are progressively introducing minimum consultation periods (over 75% of Members), as well expanding consultation periods (49% for at least four weeks).

Despite these improvements, more needs to be done. This starts with systematically giving feedback to stakeholders about how their input has helped to shape regulatory decisions. Currently, only 33% of OECD Members provide direct feedback to stakeholders, missing an opportunity to make the exercise more meaningful and potentially dissuading people from participating again. Stakeholder engagement also needs to cast its net wider to increase inclusivity and to avoid potential undue influence from more selective consultations.

To regulate better for people and tackle inequalities, governments must more systematically estimate how regulatory impacts are distributed across society and account for regulatory burdens. Finally, rules and public service delivery must be kept as simple as possible to reduce costs and frustrations for both individuals and business owners.

The green transition can only be realised with better and more adequate rules. A first step is engaging stakeholders to understand differentiated effects of the environmental risks and to overcome potential resistance to environmental policies and regulations. This report notes greater efforts to consider the environmental impacts of rules at the national level across OECD Members. But these efforts primarily relate to environmental rules themselves, rather than the potential environmental impacts of rules across other sectors. In fact, only 21% of OECD Members have reviewed rules with a “green lens” of environmental sustainability. Deepening such reviews to consider local and broader impact of pollution, carbon emissions and biodiversity is critical to ensure that rules actively support the green transition.

In some instances, the green transition is hindered by a complex patchwork of rules with both regulatory overlaps and gaps. OECD Members have taken positive initial steps towards risk-based environmental approaches, particularly for licensing, compliance promotion, and co‑ordinated inspections. Systematically adopting these practices is the next step to reduce regulatory complexity. Finally, equipping the regulators of network services such as energy, transport, water and e-communications, with clear objectives and powers to support the green transition will improve outcomes.

Technological progress – from artificial intelligence and the Internet of things to quantum computing and neurotechnology – will continue to fundamentally transform our societies. It brings massive benefits to people, society and economies, but also risks and harm. Current regulatory frameworks often lag behind technological progress, and struggle with issues such as overlapping jurisdictions, legal fragmentation, and outdated rules. To better support innovation while managing risks, governments must embrace adapt-and-learn approaches and use horizon scanning and strategic foresight to improve anticipatory governance. Strong institutional setups are important to create a more cohesive and responsive regulatory environment that can foster sound rule-making and enforcement. Improving institutions’ resourcing, skills and expertise helps build crucial knowledge to oversee and enforce the development of new technologies, while adequately protecting people from harm.

This report also highlights positive examples of governments and regulators harnessing new technologies for their own use. For example, governments are using digital technologies to more efficiently and effectively monitor regulatory impacts, more rapidly respond to emerging risks, and improve overall outcomes.

Regulations are more likely to be effective if they are 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. However, robust design of rules is not enough: it needs to be followed by effective implementation of regulations. In most OECD Members, there is scope to further support compliance and desired outcomes by adopting risk-based regulatory enforcement. Currently, more than half of OECD Members do not permit regulators to base their enforcement work on risk criteria. Sound regulatory design and delivery, with adequate resourcing, skills and capacities, are needed to support evidence-based decisions.