On 9 March 2017, Preet Bharara, US Attorney for the Southern District of New York, returned to his office to see that he had missed a phone call from President Donald Trump. It was highly unusual for the President of the United States to want to speak directly with a US Attorney. Such communication was usually routed through senior intermediaries in the Department of Justice to avoid political influence in law enforcement. In this case, those intermediaries had no knowledge of the reason for President Trump’s phone call. While senior prosecutors like Bharara were political appointees who served at the will of the appointing president, in this case, Bharara was the chief law-enforcement officer in the jurisdiction that covered much of President Trump’s personal and business interests. Bharara wanted to avoid any appearance of impropriety, but he also knew that President Trump was an unorthodox leader who sought to deal directly with subordinates and shake up government bureaucracy. Bharara was keen not to hamper legitimate communications with the new White House. He had to decide whether to return the president’s phone call in violation of Department of Justice norms.

Authors: Karthik Ramanna and Vidhya Muthuram.

Learning objectives: accountability; executive independence; organisational effectiveness; values-based leadership.

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Case study A: Facing imminent collapse during the height of the financial crisis of 2008-09, investment bank Merrill Lynch received a second lease on life as it was acquired by Bank of America. The deal was reportedly encouraged by the US Treasury which sought to avoid major contagion of failing banks. Later it emerged that Bank of America had failed to disclose to its shareholders in advance of their approval vote of the $50 billion purchase that $5.8 billion was being earmarked for Merrill Lynch executive compensation. In the wake of public outrage of bank bailouts and bank executive pay the US Securities and Exchange Commission (SEC) brought a formal complaint against Bank of America together with a pre-negotiated $33 million settlement agreement to the court of US federal judge Jed Rakoff for final approval. The US Supreme Court discouraged judges from second-guessing the executive branch of government in granting such approvals but Rakoff questioned whether the settlement amount was proportionate to the scale of the misrepresentation. Moreover, he considered whether justice was being served as Bank of America shareholders, who were the victims of the misrepresentation, were being asked to bear the settlement cost, over the managers who had overseen the acquisition. Rakoff pondered whether to reject the settlement agreement.

Case study B: This case is a supplement and presents Judge Rakoff’s observations and ruling in the case between the US Securities and Exchange Commission and Bank of America.

Authors: Karthik Ramanna and Vidhya Muthuram

Learning objectives: common-law adversarial system; judicial activism; jurisdiction; settlement agreements

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The Vatican Bank was central to the global mission of the Catholic Church, helping move money where it was most needed to meet the Church’s objectives. The bank largely operated outside the global financial regulatory system. This arrangement had historically enabled the Church to operate where others could not, for instance to support the pro-democracy Solidarność (solidarity) movement in communist Poland. In recent years, however, the bank’s culture of secrecy had gained notoriety for enabling financial irregularities. Rene Bruelhart, a Swiss lawyer who had previously helped reform Lichtenstein’s banking system, was appointed in 2012 as director of the Financial Information Authority (the Vatican’s financial regulator) to address the concerns and scandals at the Vatican Bank. As a relative outsider to the tradition-bound Vatican, Bruelhart considered his options. How broadly or narrowly should he define his objectives? How should he pace his reform in a setting that was resistant to external interference? How could he build a constructive dialogue with both internal and external stakeholders?

Authors: Karthik Ramanna and Vidhya Muthuram

Learning objectives: change management; organisational transformation; stakeholder communication

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In 2017, healthcare in the United States was regulated by the Affordable Care Act (ACA). The ACA mandated all individuals to have health insurance or pay a penalty. While millions of people across the United States gained health insurance as a result of the ACA, the insurance market in many states was tenuous. Further, many Americans viewed the ACA as an unnecessary government intrusion on individual rights. In the context of a fictional US state, this case explores the factors that contributed to the failure of the healthcare market. It explores new insights derived from behavioural economics to increase consumer choice, boost coverage, and lower overall costs of healthcare.

Authors: Karen Croxson and Vidhya Muthuram

Learning objectives: behavioural economics; market failures; policy nudges

In the forty years to 2019, the level and sources of taxes in OECD countries had remained roughly constant. However, this apparent stability had concealed serious threats to the nature of public finance. First, public expenditures had grown over that same period, particularly following the 2008-09 global financial crisis. Second, traditional sources of taxation, namely taxes on labour income and consumption, which together accounted for about 85% of tax revenue, were coming under threat by a number of emerging technological and social phenomena, including advancements in job-replacing automation; a growing gig economy; greater cross-border e-commerce; an ageing population; and an increasing concentration of wealth. All of these changes suggested the need for a fundamental redesign of the tax system. This note, written for non-tax experts, explores how these phenomena challenge the legacy approaches used to tax labour and capital. It discusses ways to rethink tax systems for the 2020s and beyond, with a particular look at two bold, yet controversial, new policy ideas: an automation tax and a tax on global wealth.

This case can be downloaded from our publications section.

Authors: Karthik Ramanna, Sarah McAra and Vidhya Muthuram.

Learning objectives: tax reform; public finance; transformational change; systems thinking; coalition building

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In 2011, Essex County Council’s (ECC) children’s social care service was in serious need of reform, having received multiple ‘inadequate’ ratings from Ofsted, the UK regulator. To improve its effectiveness, ECC hoped to introduce new preventative measures to keep children out of care and at home with their families when it was safe to do so. But amid public-funding cutbacks, ECC had severely limited resources to trial new approaches. In light of these constraints, ECC was considering an alternative funding model called a social impact bond (SIB): private investors would fund a new intervention upfront, and ECC would repay the investors (plus a return) only if the intervention achieved specified, pre-agreed social outcomes. Specifically, a proposal from a social investment organisation suggested that a SIB could fund Multisystemic Therapy (MST), a licensed, evidence-based programme designed in the US to help at-risk youth remain at home with their families. The ECC had to assess the mixed evidence available on the effectiveness of MST, and consider the trade-offs of using a SIB, which had not yet been used in children’s social care nor at the local-authority level.

Authors: Martin J Williams, Eleanor Carter and Sarah McAra

Learning objectives: using evidence in public policy decision-making; social impact bonds; outcomes-based commissioning

In 2019, India, like many countries around the world, was laying the groundwork for the deployment of 5G mobile telecom technology. 5G, with its high-speed, high-capacity and low-latency potential, was expected to transform the economy and society, with projections suggesting that it would create a cumulative economic impact of $1 trillion in India by 2035. The dominant vendor of 5G technology was China-based Huawei, which, in 2019, offered end-to-end solutions that were cheaper, faster and higher quality than its competition. But several intelligence agencies in the West suspected that Huawei would install ‘backdoors’ into its equipment to allow the Chinese government to conduct espionage activities. India, with its longstanding security concerns vis-à-vis China, was faced with a dilemma: embrace costlier and slower 5G equipment from Huawei’s competitors, potentially setting back its economic targets for 5G, or develop ways to work with Huawei to address the security concerns. Huawei had been instrumental in allowing Indian telecom operators to rapidly expand access to previous-generation mobile and internet services in recent years. And while the US had banned the use of Huawei equipment across its public and private networks, and was strongly encouraging allied countries to do the same, other countries such as the UK had signalled a willingness to continue to do business with Huawei. With time of the essence, Indian Telecom Secretary Aruna Sundararajan had to advise the new government on the way forward.

Authors: Karthik Ramanna and Sarah McAra

Learning objectives: public-private partnerships; complex problem solving; regulation of technology

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This is a short two-party, single-issue negotiation over setting a mining royalty rate. Students role-play the negotiation as either the representative of the mining company or the government’s minister of mines. Through the simulation, students become familiar with distributive negotiation techniques and learn key elements of negotiation analysis (including BATNA and ZOPA).

Authors: Emily Jones and Sarah McAra

Learning objectives: distributive negotiations; public/private negotiations; value-claiming tactics

This is a short two-party, multi-issue negotiation over a public-private partnership to build schools in Brazil. Students role-play a negotiation as either the secretary of education or the managing director of a private company. The simulation introduces students to the core features of integrative negotiations, allowing them to differentiate it conceptually from distributive negotiations. The simulation also helps students understand the ‘negotiator’s dilemma’ and learn a range of moves that can be used to create value in a negotiation.

Authors: Emily Jones and Sarah McAra

Learning objectives: integrative negotiations; public/private negotiations; value-creation tactics; ‘negotiator’s dilemma’

Around the globe, red tape, budget cuts, and falling public trust eroded civil servants’ engagement with their work. Issues of low morale and disengagement not only cost governments billions in lost productivity and higher operational costs, but also provoked questions of how to build more effective public-service organisations, particularly as governments were setting up new agencies to tackle complex problems.

The United States Attorney’s Office for the Southern District of New York (SDNY) was one public organisation to have seemingly escaped the trends of disengagement. With its reputation for excellence and independence, the SDNY attracted top-tier talent despite relatively low pay, and earnt enduring adoration from its strong alumni network. Its high-calibre employees, who adhered to a deeply shared mission of ‘doing the right thing’, delivered long hours and achieved high success rates in trial. Many SDNY employees went on to secure elite positions in private firms before returning to the public sector. Drawing on the observations and insights of several former SDNY prosecutors, this note explores the maverick practices and norms contributing to the SDNY’s apparent success as a public-service organisation.

This case can be downloaded from our publications section.

Authors: Karthik Ramanna, Radhika Kak

Date: 16 December 2019

Learning objectives: transforming and building public-service organisations; organisational effectiveness; motivating teams

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In 1991, German officials announced plans to develop the Berlin Brandenburg International Airport (BBI), a new, large airport that would replace the three existing Berlin airports. Not only did officials believe that BBI could support air traffic growth, become an aviation hub, and revitalise the economy, but they also hoped it would represent a new chapter in Berlin’s history: one unified airport for the recently reunited city.

To achieve their vision, German officials established Berlin Brandenburg Flughafen (BBF) in 1991. The company, jointly owned by the German federal government and the states of Brandenburg and Berlin, was to oversee the planning, development and, eventually, operations of BBI. However, BBF struggled to make progress. Eventually in 1997, hoping to bring in much-needed expertise and capital, BBF decided to privatise. The first attempt at a tender was unsuccessful: just two consortia submitted final bids and the losing consortium sued BBF shortly after the result was announced. The courts ruled that the tender had violated procurement laws, cancelled BBF’s contract, and ordered the company to start the privatisation process again. Now in 2002, a second tender had resulted in just one bid, with a price considerably lower than BBF had anticipated and a number of contentious terms. Facing pressure to make headway with the new airport, BBF needed to decide quickly how to proceed.

Authors: Karthik Ramanna, Vidhya Muthuram, Greg Hodkinson

Date: June 2020

Learning objectives: managing major projects; public-private partnerships; effective procurement strategies

In September 2019, the regulator Transport for London (TfL) was deliberating over the renewal of Uber’s operating licence. Since 2017, Uber had been in a precarious position in London, one of its largest markets, after TfL first decided not to renew its licence due to public safety concerns. Uber appealed and received a probationary licence, and now was awaiting a more permanent verdict.

The licensing decision was just one flashpoint in an ongoing debate as numerous interest groups actively lobbied politicians and regulators over Uber’s position in London’s longstanding car-hire regulatory regime. The drivers of London’s iconic black cabs argued that TfL let Uber operate between the lines of the otherwise strictly regulated car-hire industry, giving Uber a competitive edge. But Uber – buoyed by its hundreds of thousands of loyal customers – asserted that the app enhanced competition, expanded customer choice and created jobs. On 24 September 2019, TfL announced that it would give Uber a two-month extension as it reviewed additional information. TfL’s Commissioner Mike Brown now had two months to decide if TfL should grant Uber a licence. Meanwhile, Mayor of London Sadiq Khan – up for re-election in May 2020 – had to determine how to navigate the contentious debate.

Authors: Pepper D Culpepper, Adam Webster and Sarah McAra

Date: June 2020

Learning objectives: platform power; interest groups and lobbying; business and government relations; exploring the purpose of law in regulation

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Set during the COVID-19 pandemic, this case follows a day in the life of Professor Meghana Pandit, chief medical officer at Oxford University Hospitals NHS Foundation Trust (OUH). It is 17 March 2020, and Pandit must prepare the hospital’s four locations and 12,000 employees for the peak of COVID-19 cases projected to hit Oxfordshire in two weeks’ time. On this busy morning of back-to-back meetings, Pandit receives an email from a concerned surgeon: he and his team no longer want to continue certain elective-surgery procedures. They feel that they lack sufficient specialised protective equipment and thus face undue risk of exposure to COVID-19. National health authorities had advised that elective procedures should continue, and maintained that standard protective gear should be sufficient. Yet government guidance was changing rapidly. Not only did this hamper quick and informed decision-making for hospital leaders like Pandit, but it also contributed to confusion, anxiety and distrust among frontline healthcare workers. How should Pandit respond to the surgeon?

Authors: Karthik Ramanna and Sarah McAra

Date: June 2020

Learning objectives: leadership in times of crisis; crisis management; preparing organisations for crises; building a resilient organisational culture

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This case study follows Misba Khan, a 48-year-old, Pakistani-British woman, as she prepares to ski the last degree to the North Pole with the Women’s Euro-Arabian North Pole Expedition (WEANPE). The WEANPE sought to bring together a diverse group of 12 women from across Europe and the Middle East for the challenging Arctic expedition, with the dual aim of fostering cross-cultural dialogue and inspiring other women to forge into new frontiers. The case is set in September 2016 at the first training expedition in Iceland as Misba tries to find her place on the team. Prior to arriving, Misba had invested a good deal of effort in building necessary skills, such as becoming a strong swimmer, but she was still inexperienced in many areas, having never lit a camping stove, nor erected a tent, nor put on a pair of skis. Now, during the expedition, she is thriving at certain aspects of the training but struggling with others. The skiing has pushed her to the edge of her endurance and she has found herself connecting with only one of her teammates, Fatima, as the other teammates are somewhat younger and more experienced than she is. When Misba receives the unexpected news that Fatima was leaving the expedition for good, Misba needed to decide if she would keep going.

 
Authors: Karthik Ramanna, Oenone Kubie

Date: September 2020

Learning objectives: team leadership; team dynamics; preparing for challenges

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In the summer of 2020, as the Covid-19 pandemic and associated lockdown heightened tensions between London’s Metropolitan Police Service (Met) and the communities they policed, the latest data was published on the Met’s use of stop and search. The reports showed that in May alone, during the strict lockdown, the Met had conducted 44,000 searches – an eight-year high – and searched Black Londoners at four times the rate of white Londoners. Stop and search was among the most contentious police powers in the UK. Many police leaders considered it a vital tool for detecting and preventing criminal activity, yet others, including some in the police, worried it was not used fairly, with Black and minority ethnic (BAME) individuals consistently searched at higher rates than their white counterparts. And while this racial disproportionality had endured for decades, it gained renewed visibility in 2020 as Black Lives Matter protests highlighted racial discrimination in policing. Commissioner Cressida Dick, the senior-most officer of the Met responsible for more than 30,000 officers, had to respond to the growing scrutiny around stop and search. This case puts students in her shoes to consider how she can build trust with minority ethnic communities while also maintaining the trust and confidence of the Met – an overwhelmingly white institution – as well as the wider public and multiple political structures.

Authors: Christopher Stone, Karthik Ramanna, Sarah McAra

Date: November 2020

Learning objectives: building trust; public leadership; stakeholder engagement

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In March 2017, Maria Helena Guimarães de Castro, the executive secretary at the Ministry of Education in Brazil, was preparing to send the final draft of a new national framework for education to the National Council of Education, the body with the deciding vote. The process of drafting the reform had been long and challenging. Even the idea of national educational standards in Brazil was a contentious one, between those who believed standards would reduce the country’s deep educational inequality and those who thought that schools and local governments were best placed to make decisions about teaching. Despite the opposition, pro-standards forces had managed to create and maintain a broad coalition of experts, foundations, and politicians from across the political spectrum, and had shepherded the drafting process through years of extreme political upheaval. However, just as the draft was about to be published, members of the influential evangelical caucus approached the ministry leadership with a list of changes they wanted the ministry to adopt. If Castro refused, the consequences for the president’s legislative agenda could be dire; but if she agreed, she risked alienating many of the framework’s supporters and the fragile coalition might disintegrate. Years of careful negotiation – and the reform itself – were in jeopardy. This case study steps into this dangerous moment for the reform and asks students to weigh up the complex political and ethical issues at stake.

Learning objectives: building and maintaining coalitions; veto-player theory; fostering legitimacy for reform agendas; values-based leadership

In April 2021, Colombian President Ivan Duque’s administration put forward an urgently needed tax-reform package known as the ‘Sustainable Solidarity Bill’. Aiming to raise state revenues, the bill also targeted key areas of weakness in the taxation system: its complexity, inefficiency, and low redistribution. The bill was widely hailed by tax experts as being fair and technically sound. However, before it could be debated in Congress, the bill triggered widespread protests and public criticism, drawing on a general mood of disenchantment with government. Opponents saw the bill as targeting Colombia’s middle class, which was already struggling in light of the pandemic. Of particular concern was the bill’s proposed reform of the country’s VAT regime, notably the removal of VAT exclusions and exemptions from many goods and services, including some in the ‘basic family basket’. While poorer Colombians would receive compensation for their VAT payments, middle-class households would not. The government had to withdraw the bill, and the finance minister resigned. The case study picks up the story in May 2021, when the responsibility of redrafting the taxation reform fell on José Manuel Restrepo, Colombia’s new finance minister. How could he meet the bill’s revenue and fairness objectives whilst placating the middle-class?

Learning outcomes: tax reform; direct and indirect taxation; the politics of taxation; coalition building

Over successive governments, Chile had built a strong reputation for fiscal discipline, secured partially through accrual-accounting practices. But recent social unrest and the Covid-19 pandemic had put pressure on the government to relax longstanding rules on spending restraint, notably the country’s ‘structural balance rule’. Finance Minister Ignacio Briones needed to determine how to finance a substantial new Covid-relief package while ensuring the country remained able to respond to future emergencies and without undermining the country’s already weakening commitment to fiscal responsibility. Diving into this setting, the case study allows students to explore both the practice and the politics of government accounting and finance.

Authors: Karthik Ramanna and Oenone Kubie

Learning objectives: government accounting; accrual accounting; fiscal policy; fiscal responsibility

In 2014, Nana Agyekum-Dwamena was named Ghana’s Head of Civil Service, tasked with reforming the 14,000-person institution that was widely considered to be plagued by low motivation, inefficiency, and weak performance. Just a few weeks into the job, he was approached with an opportunity from the World Bank, which provisionally offered to fund a multi-year reform programme that Agyekum-Dwamena could design. In many ways, it was a compelling offer: the Civil Service had extremely limited financial resources, yet improving its performance remained a political priority. However, Agyekum-Dwamena had seen a series of donor-funded reforms fail to deliver since he had joined the civil service in the 1980s. The donor-funded projects often came with high administrative costs, and most had halted when funding ended or a new administration came into office. Agyekum-Dwamena had to decide if he should design a wide-sweeping reform programme to pitch to the development partner, or if he had other levers available for improving performance. For Agyekum-Dwamena, this decision raised a broader question about how he should approach the task of improving the performance of the civil service. The case is accompanied by an epilogue which describes Agyekum-Dwamena’s decision in 2014 and how he approached reform in the years that followed.

This case is also available in Portuguese.

Authors: Martin J Williams and Sarah McAra

Learning objectives: civil service reform; performance management; public management; state-donor relations; political economy of public sector reform

Soledad Núñez was appointed as the housing minister of Paraguay in October 2014. At age 31 and with no experience in public administration, she was now in charge of SENAVITAT, the housing ministry reputed for being one of the most corrupt and ineffective public institutions in the country. For years, the ministry had failed to achieve its housing targets and the country’s housing deficit was spiralling. Núñez knew that as a new minister, she would make powerful enemies, and her appointment would be opposed by many within the political establishment. But she was determined to reform the ministry and fight the system of corruption that gripped it. This case study follows Núñez during her difficult first year in office, during which time she created new regulations and processes, committed to transparency, and improved the reputation of the organisation, all while increasing the delivery of homes sixfold. In her efforts to reduce corruption, she had also dismissed Director of Administration Rufino González Flores, a popular and high-ranking official after an investigation found he had been involved in a fraudulent disbursement of almost US$4 million. But now, in December 2015, González had returned to SENAVITAT with a court order reinstating him – and some members of the organisation were celebrating his return. Núñez was shocked: she had worked hard to change the ministry’s culture, but González’s return threatened to undo her progress. Núñez knew she would need to act quickly if she was to maintain control over the situation.

This case is also available in Portuguese and Spanish.

Authors: Anna Petherick, Christopher Stone and Oenone Kubie

Learning objectives: organisational culture; leadership and ethics; corruption; power and influence

Considered the hub of Nigeria’s North-West region, Kaduna straddled the country’s north/south divide along ethnic, religious, and political groups. The state had experienced periods of violence since the 1980s, which often stemmed from religious and ethnic differences and were reinforced by perceived social and economic disparities. In the 2010s, conflict had intensified, particularly with the rise of criminal gangs and the depletion of natural resources. In 2017, in a new approach to promote peace and prevent conflict, the state established the Kaduna State Peace Commission (KSPC). Priscilla Ankut, a Kaduna native with a background in international development, became its first chief executive. She initially made progress building bridges across historically hostile groups, but by 2021, increasingly felt that her work was more palliative than structural. Moreover, violence had worsened over the period, and the death toll was rising. Then in August 2021, Ankut was presented with a new career opportunity that made her reconsider her role: an offer for a high-level job at the African Union. She had to decide if she should remain at the commission, where progress, at times, seemed counter-productive in the face of rising conflict or take the new job and let someone else take charge.

Authors: Anna Petherick, Christopher Stone and Oenone Kubie

Learning objectives: power and influence; organisational design; leadership in times of crisis; peace building