The global risk landscape is rapidly evolving due to interconnected economies, societies, and technologies. To manage emerging critical risks, governments must anticipate, understand, and address these risks, which are transboundary, highly uncertain, and systemic. This Framework, supporting the OECD Recommendation on the Governance of Critical Risks, outlines a seven-step process for managing such risks. The steps include identifying and assessing risks, sharing information, evaluating management maturity, and developing strategic recommendations. Exercises are conducted to validate gaps and proposed solutions, while strategic plans ensure flexibility and adaptability in response to risks. Implementation integrates these emerging risks into traditional risk management processes, fostering resilience against current and future challenges. It provides a structured process for governments to validate identified gaps in knowledge, authorities and capabilities needed to manage emerging risks and to validate plans for building-in flexibility and adaptability to unforeseen or poorly understood risks.

As part of broader digitalisation efforts, half of public employment services (PES) in OECD countries are employing Artificial Intelligence (AI) to enhance their services. AI is being adopted across all key tasks of PES, including most commonly to match jobseekers with vacancies. While several PES have been using such tools for a decade, adoption of AI has been increasing in recent years as these become more accessible. New AI use cases have emerged to assist employers in designing vacancy postings and jobseekers in their career management and job-search strategies. AI initiatives have significant impact on PES clients, changing how they interact with the PES and receive support, and PES staff, altering their day-to-day work. As PES seek to maximise the opportunities brought by AI, proactive steps should be taken to mitigate associated risks. Key considerations for PES include prioritising transparency of AI algorithms and explainability of results, establishing governance frameworks, ensuring end-users (staff and clients) are included and supported in the development and adoption process, and committing to rigorous monitoring and evaluation to increase the positive and manage any negative impact of AI solutions.

Subnational governments face a range of fiscal risks, defined as events whose realisation leads to significant deviations of revenue and/or expenditure from budgeted amounts. Fiscal risks reflect unforeseen macroeconomic developments, as well as structural shifts in the economy, including digitalisation and climate change. Sound management of these risks requires a comprehensive framework involving their identification, analysis, mitigation, sharing or transfer, and prudent accommodation. Within this framework, subnational governments need to strengthen their capacity to manage their own risks, but national governments also have a role to play. This includes mitigating risks created by national policies, minimising moral hazard in supporting subnational governments affected by exogenous shocks, and using their legislative powers to avert excessive subnational risk-taking. Effective intergovernmental cooperation is key to the sound management of subnational fiscal risks. The paper discusses how different levels of government can work together in applying this framework to the main types of risks. It also provides some examples of good international practices in the management of risks.

Greenhouse gas (GHG) emissions data is essential for tracking progress towards the Paris Agreement’s global temperature goals. In addition to the emissions inventories based on the Intergovernmental Panel on Climate Change guidelines, which are used for tracking progress under the framework of the Paris Agreement, there are other GHG emissions datasets that cater to different users and policy objectives. This paper evaluates three OECD datasets on GHG emissions: Air emissions – Greenhouse gas emissions inventories, Agricultural greenhouse gases emissions, and the Air Emissions Accounts (AEAs) based on the System of Environmental-Economic Accounting. It also looks at one dataset from the International Energy Agency: CO2 emissions from fuel combustion. It discusses the inventory and AEA approaches in terms of accounting principles (production- versus demand-based, territory versus residence), as well as classifications and scope of emissions. It looks at the coverage of the GHG emissions datasets and identifies the data gaps. Finally, the paper outlines several steps to enhance data coverage and quality of the datasets.

Despite European Union efforts to fight discrimination as part of its Union of Equality strategies, it is difficult to analyse discrimination in EU Member States given the scarcity of official data sources. This paper uses new survey data to examine discrimination against people from racialised communities, LGBTIQ+ people, persons with disability and religious minorities. It explores the role discrimination plays in driving well-being gaps between at-risk groups and the majority of the population. Discrimination, particularly when it occurs frequently, is associated with severe effects across many aspects of people’s lives – constraining income-earning opportunities, exacerbating housing and financial stress, subjecting people to violence, fear and low self-esteem, and contributing to mental ill health. These consequences come at a huge personal cost to the individuals directly affected and to society as a whole.

Governments worldwide are increasingly adopting behavioural science methodologies to address "sludge" – the unjustified frictions impeding people' access to government services and exacerbating psychological burdens. Sludge audits, grounded in behavioural science, provide a structured approach for identifying, quantifying, and preventing sludge in public services and government processes. This document delineates Good Practice Principles, derived from ten case studies conducted during the International Sludge Academy, aimed at promoting the integration of sludge audit methodologies into public governance and service design. By enhancing government efficiency and bolstering public trust in government, these principles contribute to the broader agenda on administrative simplification, digital services, and public sector innovation.

Since the start of Russia’s large-scale invasion of Ukraine, more than 10 million people have been displaced, either within Ukraine or abroad. Labour market integration of internally and externally displaced individuals remains challenging. While many immediate measures were undertaken in Ukraine and in host countries to support displaced Ukrainians, longer-term solutions are needed to enhance their human capital, and allow them not only to integrate into their receiving communities but also contribute to the recovery of Ukraine.

Data plays an increasingly important role for online platforms and the majority of digital business models. Along with data becoming central to competition and the conduct of actors in digital markets, there has been an increase in data privacy regulations and enforcement worldwide. The interplay between competition and data privacy has prompted questions about whether data privacy and the collection of consumers’ data constitute an antitrust issue. Should competition considerations be factored into decisions by data protection authorities, and, if so, how can synergies between the two policy areas be enhanced and tensions overcome? This paper explores the links between competition and data privacy, their respective objectives, and how considerations pertaining to one policy area have been, or could be, included into the other. It investigates enforcement interventions and regulatory measures that could foster synergies or lead to potential challenges, and offers insights into models for co-operation between competition and data protection authorities. This is a joint working paper from the OECD Competition and Digital Economy Policy Secretariat.

As populations age and the number of people with chronic conditions increases, countries need to assess how their health systems perform with regard to the management of chronic conditions. OECD's Patient-Reported Indicator Surveys (PaRIS) initiative aims to measure outcomes and experiences of healthcare as reported by patients with chronic conditions as part of the efforts to improve quality of care. The PaRIS survey, an international survey of people living with chronic conditions who are managed in primary care, is implemented in twenty countries. Following a rigorous design and development phase, the PaRIS survey was field-tested in participating countries. This paper reports on the implementation and the results of the Field Trial. The Field Trial provided important lessons which have been used to improve the survey tools and the implementation of the Main Survey.

Inter-municipal co-operation (IMC) has proved to be a constructive and efficient instrument in many EU and OECD countries for solving several issues at the local government level, including the lack of resources, administrative fragmentation, the investment burden of individual municipalities or better and more efficient organisation of public service provision. Although IMC is still often thought of as an alternative to the politically sensitive merging of small municipalities, nowadays its use has raised the interest of public administrations whose local governments are medium- and large-sized and that see this instrument as a way to empower local governments, provide them with more responsibilities, ensure sustainability of public services and fuel planning capacities and strategic thinking at the local and regional level. This paper summarises examples from EU and OECD countries where IMC either has a long-standing history or has recently received increased support and attention. It also provides an analysis of the legislative basis, support and incentives and practical data of IMC in the Western Balkan administrations. The paper offers several recommendations specific to the Western Balkan administrations for how to benefit from IMC.

Before the war, the Ukrainian Pay-As-You-Go pension system required large government transfers. Since then, large scale emigration and an increasing number of people eligible for pensions have further increased the need for government transfers and exacerbated the challenges of population ageing. At the same time, the system provides relatively low pension benefits, despite fairly high contribution rates and short time in retirement. This reflects to a large degree a relatively narrow contribution base due to a large informal economy and underreporting of labour income. Reform of the system must encourage participation, secure liveable pensions, and safeguard the system’s fiscal sustainability.

Social and emotional skills (SES) are important for various life outcomes, such as academic achievement, mental health, job performance or civic engagement. The assessment of these skills in children and adolescents, however, currently relies heavily on the use of self-reported questionnaires. As such, there is an urgent need for more direct measurement approaches of SES, which look at behaviours, actions and choices, in order to diversify the current portfolio of available assessments. The aim of this working paper is, thus, to map and review innovative assessment tools as well as technological approaches, aimed at the direct assessment of SES. Firstly, the paper documents almost 60 different behavioural tools, namely tasks and digital games. These instruments are reviewed according to a set of criteria, including their reliability, construct and ecological validity, and feasibility. Secondly, the paper identifies technological approaches, such as biophysiological measures, virtual reality or different artificial intelligence applications. Many of these technologies have the potential of being transversally integrated into different tasks and game, enriching the quality of SES assessment, albeit bringing new challenges. Lastly, the paper promotes a dialogue between the different types of innovative assessments, identifying comparative strengths and challenges.

The paper contributes to renewed debates about industrial policy in the context of recent initiatives in several OECD economies. It discusses the pros and cons of industrial policies motivated by environmental, national security and place-based/inclusiveness objectives. The paper also considers implementation and design issues, and how to respond to industrial policies in other countries. There are well-grounded economic, social and environmental justifications for some industrial policies. However, there are legitimate concerns that the benefits of such policies could be limited and the costs high. This mainly relates to measures curbing domestic and international competition and the practical and political challenges in designing and implementing effective measures. Thus, while governments may want to experiment with future and welfare-oriented industrial policies, they should exert moderation in scope, exercise caution in design and implementation, and be mindful of possible negative international implications.

Most workers who will be exposed to artificial intelligence (AI) will not require specialised AI skills (e.g. machine learning, natural language processing, etc.). Even so, AI will change the tasks these workers do, and the skills they require. This report provides first estimates for Canada on the effect of artificial intelligence on the demand for skills in jobs that do not require specialised AI skills. The results show that the skills most demanded in occupations highly exposed to AI are management, communication and digital skills. These include skills in budgeting, accounting, written communication, as well as competencies in basic word processing and spreadsheet software. The results also show that, in Canada, demand for social and language skills have increased the most over the past decade in occupations highly exposed to AI. Using a panel of establishments confirms the increasing demand for social and language skills, as well as rising demand for production and physical skills, which may be complementary to AI. However, the establishment panel also finds evidence of decreasing demand for business, management and digital skills in establishments more exposed to AI.

Informality is a long-standing structural challenge of Latin American labour markets, as almost half of people in the region live in a household that depends solely on informal employment. Informal workers are often insufficiently covered by social protection policies, for which the eligibility is often tied to formal-sector employment. The need to reform social protection systems across Latin America to make them more effective and fiscally sustainable has become more salient after the COVID pandemic. This paper argues that a basic set of social protection benefits available to all workers, whether they work in the formal or the informal sector, should and can be put in place, although it would require the ability to raise additional tax revenues. Moreover, the incentives for formal job creation would be strengthened if its principal source of financing for such basic social protection were shifted towards general tax revenues, as opposed to social security contributions, which tend to increase the cost of formal job creation. Reforming social protection systems will not be easy, but these reforms can provide the basis for both stronger and more inclusive growth in Latin America.

This paper is part of a subset of working papers within the Environment Working Paper series, presenting research on the enabling environment for investment in water security. The subset includes country and regional projects aimed at pilot testing the Scorecard, designed to assess the enabling environment for investment in water security. The paper “Assessing the Enabling Conditions for Investment in Water Security: Scorecard Pilot Test in Asian Countries” delineates the findings from the initial phase. This paper marks the commencement of the second round of pilot tests in the EU’s Eastern Partnership Countries. It presents the results obtained from assessing the enabling environment for investment in water security in Armenia, using the Scorecard. It also presents policy recommendations based on the priority investment barriers identified during stakeholder consultations in the country, involving representatives from various Ministries engaged in water security and international donors. The assessment and recommendations cover the public investment framework and its impact on water-related sectors, the water investment framework, project bankability and sustainability, as well as the contribution of other economic sectors to water security.

This paper analyses of the use of sustainability initiatives within the agricultural and minerals sectors across Latin America and the Caribbean. Building on a detailed mapping of almost 40 selected initiatives and insights from survey data collected from over 300 business representatives, it aims to promote consistency and deepen understanding of the landscape and role of sustainability initiatives in relation to Responsible Business Conduct. This paper identifies key trends, challenges, and opportunities, facilitating a more integrated approach to sustainability across these critical sectors.

Este documento presenta un análisis sobre el uso de las iniciativas de sostenibilidad en los sectores agrícola y minero de América Latina y el Caribe (ALC). A partir de un mapeo detallado de casi 40 iniciativas seleccionadas y con base en los resultados de una encuesta realizada a más de 300 representantes de empresas, tiene por objeto promover la coherencia y profundizar en la comprensión del contexto y el papel que juegan las iniciativas de sostenibilidad en relación con la Conducta Empresarial Responsable (CER). Este trabajo identifica tendencias, retos y oportunidades clave, facilitando un enfoque más integrado de la sostenibilidad en estos sectores críticos.

The upsurge in children’s screen time has sparked concerns about its impact on children’s learning, development, and well-being. Three-quarters of students in OECD countries spend more than one hour per weekday browsing social networks and nearly one in three students gets distracted by using digital devices in class. How to protect and equip students to navigate digital environments? This PISA in Focus explores why students rely on devices and how their digital device use relates to their mathematics performance, sense of belonging at school, and how much they become distracted. It highlights the role of education policies that improve students’ digital skills and behaviours and prepare teachers to teach with technology in protecting students from digital distractions at school and beyond, and building their ability to navigate digital environments.

At the UNFCCC COP21 in 2015, Parties decided that a New Collective Quantified Goal (NCQG) on climate finance shall be set prior to 2025, from a floor of USD 100 billion per year, taking into account the needs and priorities of developing countries. The ad-hoc work programme on the NCQG commenced at the beginning of 2022 and will conclude in 2024. In this context, the present paper puts forward key findings that can help to inform the final months of international discussions relating to the NCQG. First, the paper provides a stocktake of available evidence highlighting that climate action in developing countries requires significant levels of financing that can be met from a wide, and complementary, range of existing and potential new sources. Second, the paper considers how the NCQG could reflect various individual elements, grouped in three clusters: international public finance, private finance, and domestic efforts. Without pre-empting the future structure of the NCQG, the discussion in this paper illustrates how to potentially reflect both the importance of international public finance as well as the need to scale up private finance, while also recognising the magnitude and effectiveness of such finance depends on the domestic context and actions by all Parties. Third, the paper explores issues relating to tracking and assessing progress towards the future goal. These indicate that while certain elements can be tracked in monetary terms, others would require a different type of quantified indicators or qualitative information. These considerations also highlight that although data and information stemming from the Paris Agreement’s Enhanced Transparency Framework will be central, further sources will be needed for such progress assessments to be as comprehensive and policy relevant as possible.