Political finance is essential for political participation as political parties and candidates require resources to organise themselves, formulate their ideas, and communicate them to the public. However, unchecked or opaque funding can lead to the capture of laws and resources by a powerful few, undermining the quality of government and eroding public trust in institutions.

Transparency

The public has the right to know how money influences politics. By 2023 (p. 5), anonymous donations were allowed in at least 64 (p. 5) countries worldwide. The legal framework must require political parties, candidates, and campaigns to keep detailed financial records in line with international accounting standards, and manage all income and expenditure through dedicated bank accounts that are open to public scrutiny (p. 6). The independent oversight body that receives political finance reports must publish them in as close to real time as possible (p. 6).

Clean money

Political funding must originate from legitimate sources and use legal channels. By 2023 (p. 8), nearly half of 181 (p. 8) countries did not require political finance to flow through banking systems. The legal framework must establish criminal liability for individuals knowingly engaged in conferring, soliciting, or accepting substantial political funding that originates in criminal activity (p. 8). The legal framework should ban campaign donations to political parties and candidates from foreign interests (p. 9).

A level playing field

Out of 181 (p. 11) countries, 100 (p. 11) do not impose limits on the value of donations to candidates, and 96 (p. 11) do not limit donations to political parties. The legal framework must introduce reasonable limits on donations from a single source to political parties, candidates, and election campaigns, and limit expenditures following objective, reasonable, and context-specific criteria (p. 11). The legal framework should ensure that direct and indirect public funding is partly used to level the playing field for women, youth, and other underrepresented groups (p. 12).

Gender equality

Women are the largest of several groups underrepresented in politics, with only 27 (p. 14) per cent of parliamentarians in single or lower houses globally being women. The legal framework should make indirect and direct public funding for political parties conditional on criteria of gender equality in party positions and candidate lists (p. 14). Political parties must record and report campaign income and expenditure with gender disaggregated information (p. 14).

State neutrality

State neutrality in elections and campaigns is critical for preventing the abuse of state resources. By 2023 (p. 16), in 35 (p. 16) out of 181 (p. 16) countries assessed by experts, no legislation prevented state resources from being exploited for electoral benefits. The legal framework should unambiguously define permissible and prohibited uses of human, financial, material, and other public resources by political parties or candidates in the context of election campaigns (p. 16).

Accountability

An expert assessment of 109 (p. 18) countries in 2021 (p. 18) found that only 55 (p. 18) have rules which empower a body or official to ensure the accurate and timely collection and publication of political finance data. The legal framework should empower an oversight body with the mandate, independence, and financial autonomy to monitor, oversee, enforce, and facilitate compliance with political finance regulations, including by applying sanctions for breaches (p. 18).