Size matters: municipality size and integrity management in The Netherlands. A study concerning the presence of non-obliged integrity instruments in Dutch municipalities

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Size matters:

municipality size and

integrity management in

The Netherlands

A study concerning the presence of non-obliged

integrity instruments in Dutch municipalities

Masterthesis Public Administration Leiden University

Lydia Stoop

Supervisor: Dr. J. van der Voet June 2016

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Preface

Scientiae caput reverentia est Dei

This thesis is the final part of my student life. I enjoyed five years of student life, with all its benefits, in Leiden and the last year also in The Hague. These years were the happiest years of my (short) life. I learned a lot about myself, my (lesser) qualities, but moreover I learned about political science, Dutch law and in my master I have become acquainted to public administration. Through my studies, I became convinced that I want to work within the public administration to serve the public good.

This thesis is the result of months of hard work, however with a lot of pleasure. I enjoyed the process of reading, collecting data, writing and rewriting. Under supervision of Dr. Joris van der Voet this thesis has slowly progressed to this result. I would like to thank him sincerely for his continuous suggestions, critical feedback and his encouragements.

I would also like to thank all civil servants from 43 municipalities who answered my e-mails for my data collection. Other people I would like to thank are the five people (Mr. A.A.M. Brok, Mr. R.C. van Nunspeet, Ms. M.P.C. Gadella-van Gils, Mr. J.F.M. Steinbusch and Ms. M.C. van Santen) who were willing to cooperate with me in the qualitative part of this research.

Further I would like to thank my love, Collin de Visser, to critically read along and for his final editing and support. Last, but not least, I owe many thanks to my parents who always supported me in my (student) life.

Lydia Stoop Leiden, June 2016

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Abstract

This study examines the relationship between municipality size and integrity management within Dutch municipalities. The presence of four non-obliged integrity instruments has been assessed in 43 municipalities, combined with interviews in five municipalities to retrieve more in-depth knowledge of the data. The main hypothesis of this research is that large municipalities manage integrity in a more comprehensive way than small municipalities. This hypothesis is confirmed, because large municipalities possess more non-obliged integrity instruments than small municipalities. Another expectation of this research is that large municipalities emphasize both hard and soft controls, while small municipalities emphasize on hard controls. This hypothesis is not confirmed. Although large municipalities possess both hard and soft controls indeed, small municipalities do have a higher presence percentage of soft controls. This can be explained by the effectiveness of soft controls, the possibility of easily implementing soft controls and the fact that small municipalities do not feel the need to implement the assessed hard controls. This study proves that a relationship exists between municipality size and integrity management in the number of integrity instruments a municipality has. The relationship between municipality size and the presence of integrity instruments is the strongest for the presence of special civil servant(s) for integrity and the presence of management reports on integrity within municipalities. The conclusions of this study have implications for municipalities, because this research shows that the size of a municipality influences the integrity management of an organization. This study adds relevant knowledge to the literature of integrity management because it proves the existence of the relationship between size of municipality and integrity management of a municipality. Besides, this study is an addition to earlier research of Van den Heuvel et al. (2010) and Huberts et al. (2004).

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1. Introduction

1.1 Introduction to integrity

Integrity has become a major topic in Dutch public administration by the commitment of Ien Dales, the minister of Internal Affairs between 1989 and 1994. She emphasized the importance of integrity policy. Since 1992, a large number of policies have been developed to improve the integrity of governmental organizations (Karssing & Spoor, 2010, p. 72). Eventually, this has resulted in the legal requirement for governmental organizations and municipalities to implement integrity policies within their organization (Karssing & Spoor, 2010, p. 72).

Integrity of public administrations is decisive for the functioning of the government. Creditability and reliability of public organizations are based on the integrity of an organization (Van den Heuvel, Huberts, Van der Wal, & Steenbergen, 2010, p. 7). By increased regulations and media attention, integrity has become more decisive within the Dutch government. There are a lot of examples of national politicians who have been discredited after a breach of integrity.12 On a more local level there are many examples of mayors, aldermen, councillors or civil servants, who have also fallen into disrepute in recent years.34 Research by Binnenlands Bestuur – a bi-weekly magazine on public administration in the Netherlands – has shown that integrity is still a major reason for aldermen to step down, which illustrates the relevance of an adequate policy on integrity.5 Not only politicians have troubles with their integrity, several civil servants of municipalities are dismissed every year

1_{Much fuss arose after a former senator was offered a new position after he had come into disrepute.}

Eventually he refused the new position. Source: ‘Loek Hermans toch geen burgemeester Zutphen’, NOS, 28 December 2015. Available on: http://nos.nl/artikel/2077557-loek-hermans-toch-geen-burgemeester-zutphen.html (visited on 28th January 2016).

2_{A former representative of a province who would become a member of parliament was forced to}

resign because of mistakes he made as representative of a province. Source: ‘Commissie: Verheijen in

strijd met integriteit VVD’, NOS, 27 February 2015. Available on: http://nos.nl/artikel/2021728-commissie-verheijen-in-strijd-met-integriteit-vvd.html (visited on 28th January 2016).

3_{An alderman of the municipality Stichtse Vecht was accused of a conflict of interest between his task}

as alderman and his private company. His behaviour was in violation with a code of conduct for political actors. Source: ‘Integriteit wethouder Stichtse Vecht ter discussie’, Binnenlands Bestuur, 5 November 2015. Available on: http://www.binnenlandsbestuur.nl/ambtenaar-en-carriere/nieuws/integriteit-wethouder-stichtse-vecht-ter.9499516.lynkx (visited on 20th January 2016).

4_{A mayor of the municipality Ommen was forced to step down because of his integrity. The national}

department of the police is currently investigating his case. Source: ‘Burgemeester Ommen opgestapt

om ‘persoonlijke, financiële kwestie’’, NOS, 23 September 2015. Available on:

http://nos.nl/artikel/2059188-burgemeester-ommen-opgestapt-om-persoonlijke-financiele-kwestie.html

(visited on 20th January 2016).

5 _{‘Politiek gedoe nekt wethouders’, Binnenlands Bestuur, 24 July 2015. Available on:}

http://www.binnenlandsbestuur.nl/bestuur-en-organisatie/nieuws/politiek-gedoe-nekt-wethouders.9501389.lynkx (visited on 20th January 2016).

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because of fraud or corruption.67 These various examples show that integrity is still important within Dutch municipalities and that further research into this topic has added value.

Integrity is quite an abstract concept; there are many different definitions of integrity. The formal side of the story is that a person acts with integrity if his act or omission is in compliance with the applicable standards. This more formal vision originates from Rohr:

“To the extent that formal, legal, or institutional controls over the bureaucrat’s behavior are

either nonexistent or ineffective, bureaucrats have an ethical obligation to respond to the values of the people in whose name they govern. The values in question are not popular whims of the moment, but rather constitutional or regime values” (1989, pp. 4-5).

Lately, consensus has emerged that beside Rohr’s rather narrow definition that employees must abide by the rules of the governmental organization, it is expected from them to act morally as well. This is expressed in the definition of Huberts, he defines integrity as: “a

characteristic or quality that refers to accordance with the relevant moral values and norms”

(2014, p. 4).

1.2 Research question

As mentioned earlier, municipalities have the legal obligation to carry out integrity policy. However, municipalities are free to determine the content of the integrity policy themselves, beside some obliged policy instruments like a code of conduct for politicians and civil servants. Therefore, the differences between the municipalities can be large regarding non-obliged policy instruments. This research aims to examine if a relationship exists between the size of a municipality and the way a municipality manages integrity in their organization. Integrity policy is greatly widened in recent decades. Nowadays the focus is shifting from hard controls to soft controls. The focus is not so much on the presence of certain policy instruments like codes of conducts but more on organizational culture. Nowadays, an important task of governmental organizations is to change the attitudes and behaviour of officials (Van den Heuvel et al., 2010, p. 8). This development in public administration will also be examined for municipality size.

6_{Six civil servants of the municipality of Amsterdam were suspected to commit fraud by using public}

funds for private purposes. Source: ‘Zes ambtenaren stadsdeel Zuidoost verdacht van fraude’, Binnenlands Bestuur, 30 January 2013. Available on: http://www.binnenlandsbestuur.nl/bestuur-en-organisatie/nieuws/zes-ambtenaren-stadsdeel-zuid-oost-verdacht-van.8804316.lynkx (visited on 20th April 2016).

7_{The municipality of The Hague fired or punished 14 civil servants for acting without integrity.}

Source: ‘Sjoemel ambtenaar vliegt vaker de laan uit’, Algemeen Dagblad, 19 September 2015. Available on: http://www.ad.nl/ad/nl/1040/Den-Haag/article/detail/4145659/2015/09/19/Sjoemel-ambtenaar-vliegt-vaker-de-laan-uit.dhtml (visited on 20th April 2016).

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The main hypothesis of this research is that large8 municipalities have more expertise, manpower and resources and therefore they have more possibilities to create an comprehensive integrity policy. It is, for example, unlikely that a small municipality has a special officer for integrity, due to a lack of resources and necessity. Earlier research has shown that municipalities with more resources and more policy instruments assess their policy more effectively than smaller municipalities (Van den Heuvel et al., 2010, p. 75). Earlier research has also shown that large municipalities have more internal corruption and fraud investigations than smaller municipalities (Huberts, Hulsebosch, Lasthuizen, & Peeters, 2004, p. 18). This makes sense due to the fact that larger municipalities have more employees. The fact that large municipalities have more internal investigations could be an explanation for their eventual more comprehensive approach in comparison with small municipalities. In previous studies, size of municipality has never been used as independent variable. This research aims to examine whether the size of a municipality is an explanatory factor of the way a municipality manages integrity in their organization. Therefore, the research question is:

What is the relationship between the size of a municipality and the way a municipality manages integrity within their organization?

Small municipalities, and thus smaller organizations, may lack the economies of scale to develop full-scale integrity efforts (Kayes, Stirling, & Nielsen, 2007, p. 67). Larger municipalities have the advantage of resources and scale, but size can also be a disadvantage. Within larger organizations silos can emerge within divisions or departments (Kayes, Stirling, & Nielsen, 2007, p. 67). Concerning soft and hard controls it is expected that large municipalities will use soft controls more often than small municipalities, due to their possibility to create a more comprehensive policy than smaller municipalities. These differences between small and large municipalities will be examined in this research and will be explained later in this research.

1.3 Introduction to research design

The research design to answer this question consists of two parts. First, the integrity policy of fifty Dutch municipalities will be assessed on some characteristic features. This is a formal assessment. A representative sample from all Dutch municipalities will be collected, by taking the factor size of the municipality and geographical distribution into account. In this way it is possible to assess whether there is a difference between small and large municipalities with regard to non-obliged integrity instruments. After this quantitative approach, a qualitative method will be adopted in order to deepen the quantitative data. This

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will be examined by means of interviews with mayors and civil servants of several municipalities. These municipalities will be selected based on municipality size and the results of the first analysis. By combining these two approaches, it is possible to examine whether there is a difference between small and large municipalities in terms of the formal approach to integrity. The interviews serve as an additional data source to provide in-depth knowledge of the formal assessment.

The dependent variable – integrity management – is divided into two dependent variables. On the one hand this study aims to examine whether a difference exists between small and large municipalities at the presence of non-obliged integrity instruments. The expectation is that large municipalities have more non-obliged integrity instruments than small municipalities due to the more comprehensive approach of large municipalities. Chapter three further elaborates on obliged and non-obliged integrity instruments.

Another variable is the distinction between soft and hard controls. The expectation is that large municipalities will use both hard and soft controls, while small municipalities mainly use hard controls. The rationale behind this expectation is that large municipalities have more possibilities to develop new non-obliged policy instruments and soft controls are regarded as more effective than hard controls. Therefore large municipalities will often invest in implementing soft controls. Paragraph 2.2.3 elaborates further on the distinction between soft and hard controls.

Small and large municipalities have both advantages and disadvantages for the practice of integrity management. Small municipalities have a small number of employees, which can lead to an informal organizational culture with a lot of social control. This can explain a low number of integrity breaches. But, the informal culture can also have a negative effect: employees know each other well and will perhaps turn a blind eye on possible integrity breaches. Large municipalities have the advantage of a comprehensive policy on integrity with professional controls. But, with a large number of employees it may be harder to control all these individuals. As Kayes, Stirling & Nielsen explain, within large organization silos can emerge between divisions, while smaller municipalities have the advantage of a small workforce with more informal contacts (2007, p. 67). The purpose of this study is to gain a better understanding of the municipal integrity policy. The interviews can provide information about these assumptions.

1.4 Societal relevance

As mentioned earlier, integrity has gradually become more important in Dutch administrations. Therefore, the societal relevance of this research may be large.

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Municipalities increasingly need to put more attention on integrity because the media and citizens can retrieve many documents by means of the Wet Openbaarheid Bestuur9. To prevent reputational damage municipalities need to compose a strict integrity policy that works out in practice as well.

Not only are creditability and reliability based on integrity, but more importantly, citizens’ trust in government as well (Van den Heuvel et al., 2010, p. 8). Because citizens’ trust is to a great extent based on the integrity of the public administration, it is not surprising that much disturbance is caused when it appears that a politician or civil servant does not act according to the integrity rules. Integrity policies are meant to prevent integrity breaches from happening and to ensure employees work honest with public resources. The conclusions of this study may have implications for municipalities, if this research shows that size of municipality actually influences the integrity management of an organization.

1.5 Scientific relevance

This research is also scientifically relevant because it may add relevant knowledge to the literature of integrity management at municipalities. This study builds on earlier research and aims to contribute by using new research prospects. This research focuses on the presence of certain policy instruments and the relation with municipality size. Earlier research focused mainly on the attendance of (obliged) hard controls or the number of integrity violations, and how municipalities dealt with these violations (Van den Heuvel et al., 2010; Huberts, et al., 2004). Moreover, the policy instruments that will be examined in this research are non-obliged policy instruments, while earlier studies mainly focused on the presence of non-obliged policy instruments (Van den Heuvel et al., 2010). Besides, earlier research into integrity management of Dutch municipalities did not focus on the size of municipality as a determining factor for differences between municipalities. This study may give an answer to the question whether municipality size explains the presence of (soft and hard) integrity instruments.

1.6 Structure of thesis

This thesis is structured as follows: in chapter two a theoretical framework around integrity will be drawn. The key concepts of this thesis are further explained, such as the concept of integrity, integrity management and municipality size. The theoretical framework will also include hypotheses and their support. In chapter three background information on the historical development of integrity management within the Netherlands will be provided. Chapter four elaborates on the research design and methods and explains why these research

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methods have been used. Chapter five will present the results of my research. The conclusion and discussion of my research will be presented in chapter six.

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2. Theoretical framework

In this chapter a literature review on integrity management will be presented. Within the first paragraph, integrity in general will be elaborated on. Another concept is integrity management: the management of integrity within an (public) organization, which will be discussed in paragraph two. The need and goal of integrity management will be explained and applied to public organizations. The last paragraph elaborates on municipality size. Earlier studies on this topic will be discussed.

2.1 Integrity

Integrity is defined in many ways and different visions exist on integrity in public organizations. In this section the concept of integrity is further explained. Paragraph 2.1.1 provides a discussion on the definition of integrity. Paragraph 2.1.2 discusses the different visions that one can have on integrity.

2.1.1 Definition of integrity

Ethical behaviour is a duty in carrying out the assigned task, function, responsibility, authority or power (Van den Heuvel & Huberts, 2010, p. 27). The foundation for what is considered to be ethical behaviour can be found in ethics and within prevailing moral principles and values. This involves both organizational ethics - moral values and standards of the organization - and professional ethics, which refers to the moral values that are inherent to the decent exercise of the profession (Van den Heuvel & Huberts, 2010, p. 27). The prevailing moral rules may change over time; therefore integrity is also a relative concept. The acceptable behaviour of today may be considered objectionable tomorrow. Besides, whether or not a person can be considered to act with integrity may depend on the specific situation, place or time. In addition, great differences may exist between countries about which behaviour is acceptable or not (Kaptein, 1999, p. 626).

Honest politicians, administrators and civil servants perform their duties and function according to the professional demands placed upon them, in accordance with their position and responsibilities. Moreover, they can take responsibility for the choices they make (Van den Heuvel & Huberts, 2010, pp. 27-28). Integrity of public administration is the basis for all other values (Van den Heuvel & Huberts, 2010, p. 29), such as being effective, efficient, lawful, democratic and honest (Van den Heuvel et al., 2010, p. 7). Some virtues that integrity is concerned with are purity, solidarity, involvement, intactness, sincerity and scrupulousness (Kaptein, 1999, p. 626).

As explained earlier, the definition of Rohr of integrity is too narrow. According to him, integrity is compliance to the rules. But, integrity is more than only compliance with the rules

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because it is also a personal responsibility next to a binding set of rules. Therefore, integrity consists also of a moral part (Van den Heuvel, Huberts, & Verberk, 2002, p. 29). Civil servants need to be able to judge whether behaviour is acceptable or not. This judgment needs to be based on the relevant norms and values of the organization and the norms and values of the person itself.

Huberts describes the differences between a value and a norm as follows:

“A value is a belief or quality that contributes to judgments about what is good, right,

beautiful, or admirable. Values thus, carry weight in the choice of action by individuals and collectives. A norm, on the other hand, is more specific. Norms tell us whether something is good or bad, right or wrong, beautiful or ugly. Integrity focuses on moral norms and values, those that concern what is right or wrong, good or bad, usually in regard to the issues that people feel strongly about, the issues that matter for the community to which they belong. Both morality and ethics, therefore, refer to what is right of wrong, good or bad; and the terms ethical and moral are commonly used as interchangeable synonyms” (2014, p. 5).

A civil servant needs to act in accordance with the prevailing moral values and standards and related rules (Van den Heuvel & Huberts, 2010, p. 27). Thus, a civil servant is a man or woman of integrity if his or her behaviour (as a civil servant) is in harmony with relevant moral values and norms (including laws and rules). Which values, norms, laws and rules are relevant, however, depends upon the context (Huberts, 2014, p. 4-5).

Within the field of public administration, integrity is equal to good governance and a good civil service. Public administration is about serving society, the general interest. According to Dwivedi, integrity is fundamental to public administration:

“The profession of public service has no parallel among other professions in the sense that

society expects public servants to act with unwavering integrity, absolute impartiality, and complete devotion both to the public interest and to the state. This is the basis and fundamental precept upon which various standards and requisites of performance for public servants have been built” (Van den Heuvel, Huberts, & Verberk, 2002, p. 28).

2.1.1.1 Political and administrative integrity

Within Dutch municipalities a distinction can be made between political and administrative integrity. Political integrity is focused on the integrity of the municipality council, the aldermen and the mayor (Van den Heuvel et al., 2010, p. 9). Within a municipality the council clerk10 has the most knowledge of the integrity of the political actors within a municipality (Van den Heuvel et al., 2010, p. 10). Administrative integrity is focused on the

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integrity of the entire municipal organization (Van den Heuvel et al., 2010, p. 9). The director of the municipality11 is, next to the mayor, responsible for the integrity management within the organization. It is important to note that this research focuses on administrative integrity within Dutch municipalities.

2.1.2 Visions on integrity

Huberts (2014) distinguishes eight visions that one can have on integrity. The first vision regards integrity as wholeness, consistent and coherent (Huberts, 2005, p. 4). Montefiore adds within his literature review on integrity that: “the association with wholeness seems to be

dominant” (1999, p. 9). Montefiore summarizes this vision as following:

“Persons of integrity may be taken to be those whose overall patterns of desire and working

principle are fully integrated, as it were, and who are neither at conflict with themselves nor given to wayward departures from their normal patterns of conduct over the course of time”

(1999, p. 9).

Within the second vision integrity is being integrated into the environment. Integrity then depends on the level of integration into the system in which the actor operates (Huberts, 2014, p. 40). This vision focuses on the relationship with others, “that is, integration into a larger

system of interactions” (Huberts, 2014, p. 40).

In the third vision integrity is approached as a professional responsibility (Huberts, 2005, p. 5). Integrity means that a professional takes his responsibilities properly, carefully and reliably, taking into account all the interests at stake (Karssing, 2002, p. 26). In this vision integrity clearly has the connection with profession and organization. This vision lacks a moral filter according to Blenkert: “Integrity involves more than simply doing what one says;

what one says and does must also pass through some moral filter. As such, integrity is closely bound up with business ethics and forms of social responsibility” (2004, p. 4).

Integrity as conscious and open acting based on moral reflection, is the fourth vision Huberts distinguishes (2014, p. 42). Within this vision “It is the individual who decides what is right,

who is supposed to do something, and who should be open about it” (Huberts, 2014, p. 42).

Integrity is not the responsibility of the organization as a whole, but the responsibility of the individual who is working within the organization.

The fifth vision regards integrity as a value between other values. Civil servants need to act in the interest of the organization (Huberts, 2014, p. 42). A civil servant should not be guided by self-interest. Important values in this vision are incorruptibility and righteousness (Huberts,

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2014, p. 42).

The remaining three views connect integrity with values, and integrity is seen as an overarching concept. The sixth vision is the constitutional conception of integrity. A person needs to act in accordance with applicable standards, values and rules. The definition of Rohr fits within this vision.

The seventh vision is somewhat similar to the sixth one, but slightly wider than the legalistic approach. Integrity is seen as in correspondence with prevailing moral values, norms and rules. Integrity stands for what morally can be tolerated (Huberts, 2005, p. 7). This view is close to “a general way of acting morally” (Blenkert, 2004, p. 5).

Within the last vision, integrity is seen as exemplary moral behaviour, it links integrity primarily with a formulated ideal image (Huberts, 2005, p. 5). Integrity as “the stuff of moral

courage and even heroism” (Blenkert, 2004, p. 5). Dobel describes someone as an upright

person when this person meets three requirements: “obligations of office, personal

commitment and capacity, and prudence” (1999, p. 20).

In this research integrity is defined as “a characteristic or quality that refers to accordance

with the relevant moral values and norms” (Huberts, 2014, p. 4). The definition this research

uses is in accordance with the seventh vision on integrity. When the integrity of an organization or person is discussed an integrity judgment need to be made. This judgment always raises the moral dimension: the question of what is considered right and wrong, so the legalistic approach of Rohr does not suffice (Huberts, 2014, p. 45).

2.2 Integrity management

The government has the responsibility to carry out a full and effective integrity policy. This obligation applies not only towards the society, but also as an employer towards numerous administrators and civil servants (Van den Heuvel & Huberts, 2010, p. 29). The importance of integrity and integrity management is often formulated in terms of confidence-building in the public service and good governance (Hoekstra, 2012, p. 239): “Public sector ethics are a

prerequisite to, and underpin, public trust, and are a keystone of good governance” (Lewis &

Gilman, 2005, p. 22). The definition of Kaptein (1999, p. 625) of integrity management is: “Integrity management is concerned with systematically and completely reviewing, analyzing

and developing or safeguarding the ability of organizations to combat breaches of integrity”.

This definition focuses especially on the prevention of integrity breaches.

Paragraph 2.2.1 explains why an organization needs to manage integrity. The goals of integrity management will be discussed in paragraph 2.2.2. The third paragraph explains the

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difference between soft and hard controls.

2.2.1 Why integrity management?

There are many reasons why public administrations and organizations need to have integrity policies. Kaptein (1999, p. 625) argues that organizations can have moral reasons (responsibility to prevent dishonourable conduct), legal reasons (it is obliged to guarantee integrity) or economic reasons (breaches of integrity cost money) to have integrity policies.

For public administrations there are societal (external) and organizational (internal) reasons for integrity policy. Public administrations work with resources, i.e. tax money, contributed by citizens. Citizens may expect good governance in return. Integrity policy also contributes to a positive perception of public administrations of citizens and to citizens’ trust in government (Hoekstra, 2012, p. 240). Next to these societal reasons for integrity policy, there are also organizational (internal) reasons for integrity policy. Integrity policy contributes to job satisfaction, a proper working atmosphere, and trust in the employer. Besides, integrity breaches cost the organization a considerable amount of money and impede a proper performance (Hoekstra, 2012, p. 240).

Moreover, according to Van den Heuvel & Huberts it is a right of civil servants, politicians and administrators to have a correct integrity policy (2010, p. 30). The organization must be arranged in such a way that politicians, administrators and civil servants are not unnecessarily exposed to temptations. They need to be protected by rules, procedures, norms and values of the organization against possible integrity breaches (Van den Heuvel & Huberts, 2010, p. 30).

2.2.2 Goal of integrity management

Policy is intended to address problems: the main goal of integrity policy is to prevent integrity breaches from happening (Van den Heuvel et al., 2010, p. 91). Another goal of integrity policy is to foster integrity awareness by the enlargement of the ethical atmosphere and moral consciousness of an organization (Van den Heuvel et al., 2010, p. 28). Kaptein argues that integrity management should focus on “the creation of conditions within which an

organization-wide consciousness-raising effort and internal interaction can take place”

(1999, 633). After examining 150 breaches of integrity, Kaptein formulates seven factors that encourage employees to act according their responsibilities (1999, p. 630):

1. “Providing clear expectations for employees with regard to making a responsible choice; 2. Providing consistent and unambiguous expectations by, for example, ensuring managers to

set a good example;

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4. Creating support for attempts to fulfil the expectations with regard to making a responsible choice;

5. Providing insight into whether or not employees and the organization as a whole are living up to expectations;

6. Making conflicting expectations discussible, both among employees themselves and between themselves and their managers, and encouraging employees and managers to tackle each other about failures to live up to expectations or any breaches; and

7. Rewarding employees who live up to expectations or make an effort to do so, and disciplining employees who wilfully fail to live up to expectations”.

According to Kayes, Stirling and Nielsen organizations with integrity display four characteristics. Firstly, the language of ethical decision-making is used within an organization. Secondly, the organization develops structural procedures that facilitate ethical decision-making. Thirdly, the organization has an open culture where responsibility and commitment have been created and sustained as the goals of the organization. Finally, the employee is encouraged to develop further within an organization (Kayes, Stirling, & Nielsen, 2007, p. 63).

The standard model of integrity management is based on the distinction between rules and values, introduced by Sharp Paine (Jeurissen, 2002, p. 185), who distinguishes between the compliance-based and the value-based approaches (Van den Heuvel et al., 2010, p. 26). The compliance-based approach puts emphasis on the prevention of integrity breaches. Rules, guidelines and procedures need to be formulated and the punishment of wrongdoers encourages compliance with the imposed standards (Hoekstra, Belling, & Van der Heide, 2008, p. 148). The compliance-based approach is comparable to the hard controls. The value-based approach focuses on promoting the principle of acting as a good employer and civil servant. Building moral competence and stimulating a culture of responsibility characterize the policy of this approach (Hoekstra, Belling, & Van der Heide, 2008, p. 148). The value-based approach focuses on the own responsibility of the employees. Employees should be able and stimulated to make their own moral judgments (Jeurissen, 2002, p. 186). The value-based approach is comparable to soft controls. In the next paragraph soft and hard controls are discussed further.

To conclude, the goal of integrity management is the increase of the ethical atmosphere in the organization, both by means of the compliance-based approach (hard controls) and the value-based approach (soft controls).

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2.2.3 Soft versus hard controls

The Netherlands Court of Audit12 and the literature on integrity management make a distinction in integrity policy of governmental organizations. The system of integrity management consists of two components. The first component consists of organizational measures, such as regulations, monitoring and reporting and investigating procedures. These are called hard controls. These formal controls form the foundation for a “comprehensive

approach to organizational integrity” (Kayes, Stirling, & Nielsen, 2007, p. 64). However, a

moral consciousness does not only appear in formal organizational controls, but also in informal actions and values. A “comprehensive approach to organizational integrity” also requires implementing ethical awareness into the organization (Kayes, Stirling, & Nielsen, 2007, p. 65). This is the second part of integrity management.

Integrity management also means promoting an ethical organizational culture, for example by trainings for staff and exemplary behaviour of the management. This is defined as soft controls (Algemene Rekenkamer, 2010, p. 7). Soft controls have the aim to influence attitudes and behaviour of administrators and civil servants. Integrity awareness appeals to act responsible and ensure accountability (Van den Heuvel & Huberts, 2010, p. 30). Nowadays, attention is increasingly paid to these soft controls. Integrity management is not focused anymore on the organizational structure that is fixed within regulations and hard controls but more on the organizational culture (Van den Heuvel et al., 2010, p. 8).

The Court of Audit pointed out in 2010 that the emphasis of integrity management within Dutch public organizations should be on improving the current integrity management instead of on developing new rules. This recommendation suits within the trend of the rise of soft controls in addition to the existing hard controls (Van den Heuvel et al., p. 25). This can be explained by the fact that soft controls are much more effective than hard controls, according to directors of organizations in the study of Van den Heuvel et al. For small municipalities it is harder to invest in integrity management because further policy instruments are not considered necessary and they need to cope with a lack of resources. Large municipalities have the resources to develop integrity management further within the organization and therefore can make use of the possibility to implement soft controls more often than small municipalities.

2.3 Size of municipality

The independent variable of this study is size of municipality. As told earlier, size indicates in this study on the population of the municipalities. However, the greater the number of

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inhabitants a municipality has, the greater the management of a municipality is and the greater the number of civil servants a municipality has. This study expects that the size of a municipality is an important explanation for the comprehensiveness of integrity management within a municipality.

When organizations put more effort into integrity regulations the attention for integrity within the organization is greater. Research by Huberts et al. proves that there is a significant relation between the number of investigations into employees and the size of the municipality (2004, p. 13). Earlier research found that there is a difference in corruption- and fraud pattern between large and small municipalities. Relatively speaking, there are more investigations into politicians and administrators in small municipalities. This raises questions about possible conflicts of interest between public administration and society in smaller municipalities (Huberts et al., 2004, p. 21). An explanation for this difference could be that smaller municipalities have relatively more politicians and administrators than large municipalities (Van den Heuvel et al., 2010, p. 68). Therefore, these differences should not be exaggerated according to Van den Heuvel et al. (2010, p. 56). Huberts et al. conclude that the larger the municipality is, the more attention the municipality has for integrity resulting into more investigations into corruption and fraud (2004, p. 14). This attention could also be translated into more integrity instruments that are not obliged to prevent integrity breaches from happening and to raise awareness for integrity within the staff of the organization.

The difference between small and large municipalities is quite obvious: large municipalities have more resources to invest in integrity policy. Small municipalities, and thus smaller organizations, may lack the economies of scale to develop full-scale integrity efforts (Kayes, Stirling, & Nielsen, 2007, p. 67). Larger municipalities have the advantage of resources and scale (Kayes, Stirling, & Nielsen, 2007, p. 67). Because large municipalities have more resources, manpower and expertise, it is expected that they manage integrity in a more comprehensive way than small municipalities. Another explanation for the fact that small municipalities do not possess a wide range of integrity instruments is the lack of need for more integrity instruments, because of the low number of civil servants. With a smaller number of civil servants, the chance of having an integrity breach is smaller. These explanations result in hypothesis 1.

Hypothesis 1: Large municipalities manage integrity in a more comprehensive way than small municipalities.

Organizations with more resources to invest in integrity policy are able to develop new integrity instruments themselves. This has been confirmed by the outcome of the research of Van den Heuvel et al. They found that large municipalities consider the influence of the

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government and legislation on municipal integrity policy the lowest. This while municipalities with up to 250.000 inhabitants consider the government and legislation as of great influence on municipal integrity policy (2010, p. 81). Small municipalities thus have a focus on obliged instruments, while large municipalities consider the influence of the government and legislation on municipal integrity policy the lowest. Moreover, large municipalities have more resources and necessity to invest in integrity policy. A comprehensive approach to integrity requires next to hard controls also soft controls: implementing ethical awareness into the organization (Kayes, Stirling, & Nielsen, 2007, p. 65). Soft controls are relatively new policy instruments that are not obliged by government regulations. The expectation is that large municipalities invest in soft controls because, in general, soft controls are considered as more effective (Van den Heuvel et al., 2010, p. 74). These explanations result in hypothesis 2. Paragraph 2.2.3 further elaborates on the distinction between soft and hard controls.

Hypothesis 2: Large municipalities will use both hard and soft controls, while small municipalities will use mainly hard controls.

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3. Background information on integrity in the Netherlands

In this chapter background information is provided on integrity in the Netherlands. Paragraph 3.1 discusses the development of integrity management in the Netherlands. Paragraph 3.2 elaborates on integrity management in Dutch municipalities with results from earlier studies into the presence of integrity instruments in the Netherlands.

3.1 Development of integrity management in the Netherlands

The first paragraph of this section explains the different generations of integrity management in the Netherlands. Paragraph 3.1.2 provides information about the legal framework of integrity management in Dutch law.

3.1.1 Historical development of the concept integrity in the Netherlands

Integrity management is quite a new topic within public administration. At the beginning of the nineties attention arose for integrity due to several breaches of good governance.13 Since then, the attention and importance of integrity increased (Hoekstra, 2012, p. 240). According to Hoekstra et al. a predominance of the compliance-based approach exists. But they also acknowledge that the tide is turning and that integrity policy is moving beyond compliance (2008, p. 151).

Hoekstra et al. (2008, pp. 144-146) make a historic distinction between three periods in the development of integrity management in The Netherlands. The first period runs from 1990 to 1995. This period is characterized by raising awareness for public administrations’ integrity, agenda setting and taking measures within the infrastructure of an organization. However, there was no substantial improvement of integrity policy implementation. Ien Dales, the women who started it all, explains this by stating: “politicians and administrators are inclined

to try to reduce integrity breaches to incidents, and that people may simply look the other way in embarrassment” (Hoekstra, Belling, & Van der Heide, 2008, p. 145). Karssing & Spoor

also divided the development of integrity management in The Netherlands in three generations. They describe the first generation as mainly focused on big integrity breaches: fraud and corruption. This negative formulation of integrity was characteristic for the first period (Karssing & Spoor, 2010, p. 73). Integrity policy does not contribute to the effectiveness and quality of public administration; the policy was entirely focused on preventing integrity breaches (Karssing & Spoor, 2010, p. 74).

The second period from 1995 to 2003 is characterized by the development of rules and

13_{Ien Dales, Speech VNG (Community of Dutch Municipalities) Congres 1992. Available on:}

http://www.integriteitoverheid.nl/fileadmin/BIOS/data/Speeches%20en%20presentaties/speechminister dalescongresvngjuni1992.pdf (visited on 30 May 2016).

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instruments. Rules were tightened and enforcement and monitoring were sewed on. Measures were increasingly focusing on the competencies of employees to intensify the ethical awareness, recognizing dilemmas, the development of environmental sensitivity, motivation and independence in theory and practice (Van den Heuvel et al., pp. 89-90). Some integrity instruments were legislated, such as the obligation to declare outside activities that relate to the function of the official concerned within The Civil Servants Act (1997) (Hoekstra, Belling, & Van der Heide, 2008, pp. 145-146). According to Karssing & Spoor, integrity is formulated positively within the second generation. Values and responsibilities are mentioned and more attention is paid to dilemmas. Integrity has increasingly become part of daily practice, but there still is a distinction between integrity issues and acting professionally (Karssing & Spoor, 2010, p. 75).

Within the last time frame (started in 2003) the attention to integrity increased. The compliance-based approach started to shift to the value-based approach. In 2004, the coordinating minister for integrity stated that policy “should no longer focus solely on rules

and control-oriented instruments” (Hoekstra, Belling, & Van der Heide, 2008, p. 146).

According to Van den Heuvel et al. municipalities have not arrived at the third generation of integrity policy yet. They are convinced that the differences between the policies of the municipalities are too big (2010, p. 88). Also Karssing and Spoor are convinced that the third generation needs to be introduced yet within the integrity management of the public administration. Within this third generation, integrity is a professional responsibility. Therefore, integrity is a dimension of professional practice and no separate issue anymore. The crucial question in an integrity discussion should be: ‘How am I a good civil servant?’ and not ‘How do I avoid breaking the rules?’ (Karssing & Spoor, 2010, p. 76). Because their research was conducted in 2010, this thesis can examine whether municipalities have developed further towards the third generation of integrity management and whether the differences between municipalities are smaller. This brings us to the conclusion that Dutch integrity policy in the last decades has mainly been dominated by what is known as the compliance-based approach (Hoekstra, Belling, & Van der Heide, 2008, p. 143)

3.1.2 Legal framework of integrity

Integrity is a municipality wide issue: elected representatives, administrators and civil servants must ensure their integrity themselves. Furthermore, they bear responsibility together for the administrative integrity of the municipal organization. Over the years, more and more

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regulations are formally legislated in Dutch law. Administrative integrity is a responsibility of the municipal executive14.15

There are some provisions included in Dutch criminal law that have to do with integrity of a governmental organization: embezzlement (article 359 Criminal Law), forgery (article 360 Criminal Law), destruction of evidence (article 361 Criminal Law), fraud and corruption (article 363 Criminal Law) and secret infringement (article 272 Criminal Law).16

Next to these prohibitions some commandments are also legislated. Within the municipalities, the mayors have the special task to promote the administrative integrity of the municipality. This is captured in article 170 of the law on municipalities. It reads: “De burgemeester

bevordert de bestuurlijke integriteit van de gemeente”.17

Initially, this mayor’s task was not

so clearly stated in the law. By formalizing this task, supervising integrity has changed from a general task to a specific responsibility, according to the explanatory memorandum.18 Specific attention has been paid to this transition since it was legislated (1 February 2016).19 Dutch law also provides some obliged policy instruments that governmental organizations need to implement. These are the following: a code of conduct20, an oath of office21, rules for other positions22, whistle-blower policy and rules on declaration and accepting gifts.23

14_{College van Burgemeester en Wethouders.}

15_{‘Circulaire. Wijziging in gemeentewet, Ministerie van Binnenlandse Zaken en Koninkrijksrelaties, 9}

December 2015. Available on:

http://www.integriteitoverheid.nl/fileadmin/BIOS/data/Wet%20en%20Regelgeving/circulaire-aan-gemeenten_Wijzigingen_Gemeentewet_per_1_februari_2016.pdf (visited on 13th May 2016).

16 _‘Wetboek _van _{Strafrecht’,} _Overheid.nl. _Available _on:

http://wetten.overheid.nl/BWBR0001854/2016-04-20#BoekTweede (visited on 13th May 2016).

17_{‘Wijziging van de Gemeentewet, de Provinciewet, de Wet openbare lichamen Bonaire, Sint Eustatius}

en Saba en de Waterschapswet (institutionele bepalingen). Voorstel van wet’, Tweede Kamer der

Staten Generaal, 2013. Available on: https://zoek.officielebekendmakingen.nl/kst-33691-2.html

18_{‘Wijziging van de Gemeentewet, de Provinciewet, de Wet openbare lichamen Bonaire, Sint Eustatius}

en Saba en de Waterschapswet (institutionele bepalingen). Memorie van toelichting’, Tweede Kamer

der Staten Generaal, 2013. Available on: https://zoek.officielebekendmakingen.nl/kst-33691-3.html

19_{‘Circulaire. Wijziging in gemeentewet, Ministerie van Binnenlandse Zaken en Koninkrijksrelaties, 9}

December 2015. Available on:

http://www.integriteitoverheid.nl/fileadmin/BIOS/data/Wet%20en%20Regelgeving/circulaire-aan-gemeenten_Wijzigingen_Gemeentewet_per_1_februari_2016.pdf (visited on 13th May 2016).

20 _Art. _125quater _(c) _{Ambtenarenwet} _(law _on _public _servants). _Available _on:

http://wetten.overheid.nl/BWBR0001947/2016-01-01 (visited on 18th March 2016).

21

Art. 125quinquies (1)(a) Ambtenarenwet (law on public servants). Available on:

22 _{Art. 125quinquies (1)(b) Ambtenarenwet (law on public servants). Available on:}

23

Art. 15 (1)(c) CAR-UWO (Collectieve Arbeidsvoorwaardenregeling en Uitvoeringsovereenkomst) (labor agreement). Available on: https://caruwo.vng.nl/IntegraleVersie.htm (visited on 18th March 2016).

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3.2 Integrity management at Dutch municipalities

In this paragraph facts are provided about the presence of some integrity instruments at Dutch municipalities. Paragraph 3.2.1 is about earlier research at Dutch municipalities. The second paragraph deals with the effectiveness of integrity policy and integrity instruments.

3.2.1 Earlier research on presence of integrity instruments

Dutch municipalities have a wide range of different policy instruments for integrity (Van den Heuvel et al., 2010, p. 72). Several studies have carried out research on the presence of integrity policy in Dutch municipalities. Van den Heuvel and Huberts conclude that there is quite a lot attention for integrity. Besides, in the international field the Dutch integrity policy is leading (2010, p. 37). However, they conclude that there is room for improvement. There is little attention within management reports of municipalities to integrity and the efficacy score of some policy instruments is estimated to be low (Van den Heuvel & Huberts, 2010, p. 33). Research from Huberts et al. show that the number of reported corruption and fraud investigations increases, when the attention of politicians and administrators paid to integrity increases (2004, p. 13). This pattern applies also to the attention of senior officials and the number of reported investigations (Huberts et al., 2004, p. 13). However, they also found that there is no relation between the presence of more integrity instruments and the number of reported investigations. Municipalities with more integrity instruments do not conduct more investigations (Huberts et al., 2004, p. 14). Most investigations within municipalities concern investigations into civil servants. This is due to the fact that there are many civil servants within the public administration and only few administrators (Huberts et al., 2004, p. 21). Huberts et al. have collected the presence of integrity policy instruments within municipal organizations. This research was carried out in 2003 and the results of this inventory can be found in table 1.

Policy instrument Presence

(n=225) (%)

Rules for accepting gifts 82 Management reports on integrity 22 Code of conduct for administrators 76 Code of conduct for employees 64 Control of accuracy diplomas and certificates on recruitment 56 Central registration of integrity breaches 22 Rules on declaration 93

Table 1: Presence of integrity policy instruments at Dutch municipalities (Huberts, Hulsebosch, Lasthuizen, & Peeters, 2004, p. 12)

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Van den Heuvel et al. (2010) conducted a similar study with even more integrity policy instruments. The results of this study can be found in table 2. It is remarkable that many policy instruments are much more common in 2010 compared to 2003. Van den Heuvel et al. conclude that soft controls are less present and familiar than the hard controls (2010, p. 72). They further argue that the image of earlier studies is confirmed: classical, regulating, and often obliged instruments are present in the vast majority of the municipalities, but this is not the case for newer instruments (Van den Heuvel et al., 2010, p. 73)

Policy instrument Presence

n=254 (%)

Quite to very familiar

Rules for accepting gifts 99,2 90,9 Code of conduct for employees 98,7 94,0 Rules on declaration 97,9 96,4 Rules for other positions 97,9 74,2 Whistle-blower policy 91,6 56,8 Oath of office 90,4 96,1 Confidential person for integrity 88,3 61,2 Integrity is regularly discussed in team meetings 76,3 76,7 Control of accuracy diplomas and certificates on recruitment 66,5 58,3 Trainings for staff aimed at moral consciousness and/ or

acting with integrity

50,4 72,9 Central registration of integrity breaches 49,0 26,2 Management reports on integrity 43,7 45,0 Risk analysis and vulnerability assessments 43,0 25,3

Table 2: Presence (and familiarity) of integrity policy instruments at Dutch municipalities (Van den Heuvel, Huberts, Van der Wal, & Steenbergen, 2010, p. 72).

Both researches used directors of municipality as respondents to assess the municipal integrity policy instruments. The director of the municipality leads the administrative organization of the municipality and consequently has good overview over the integrity policy (Van den Heuvel et al., 2010, p. 13). The director of the municipality is responsible for the quality of the administrative organization and is closely concerned with the political-administrative processes within a municipality (Huberts et al., 2004, p. 5).

Research of Van den Heuvel et al. also shows that the mayor and the director of the municipality manifest themselves emphatically as leaders of the municipal integrity policy (2010, p. 28). This study also shows that the administrative management of the municipality has the most influence on integrity policy of a municipality, followed by the mayor and aldermen (Van den Heuvel et al., 2010, p. 81).

This research focuses on the presence of four non-obliged integrity instruments within Dutch municipalities: trainings for staff aimed at moral consciousness and/or acting with integrity, presence of special civil servant(s) for integrity, yearly management reports on integrity and

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regular discussion on integrity in team meetings. Whether these instruments are present differs greatly in 2010. Paragraph 4.2.2 elaborates further on this choice.

3.2.2 Effectiveness of integrity management

According to Dunn (2008)24 and Hoogerwerf & Herweijer (2008)25 policies must meet certain conditions in order to be effective: a vision must underlie the policies, the goals of the policy must be formulated, the policies should be aligned with the goals and the target audience, and the policies need to be consistent (Van den Heuvel et al., 2010, p. 26). An effective integrity policy is characterized by a balanced combination of instruments from both the compliance-based approach and the value-compliance-based approach (Hoekstra, Belling, & Van der Heide, 2008, p. 151). Integrity management of municipalities solely consisting of hard controls is therefore not sufficient, according to Hoekstra et al.

A municipality can have policy instruments, but its presence does not guarantee effectiveness. The effectiveness of policy instruments will depend on compatibility, vision and control.Van den Heuvel et al. provided several conditions for effectiveness. Firstly, the policy instruments must meet the target audience. Secondly, the management should envision what function the policy has. Finally, the influence of informal control is vast (Van den Heuvel et al., 2010, pp. 26-27). Van Tankeren (2007)26 concludes that in order to have effective integrity policy it is also important to evaluate the policy periodically. Furthermore, integrity policy should take an explicit place within the organizational policy and he recommends that a central actor should be held responsible for the development and coordination of integrity policies. Moreover, broad support within the organization is necessary for effective integrity policy (Van den Heuvel et al., 2010, p. 27)

According to directors of municipalities the most effective integrity policy instruments are rules for declaration and rules for accepting gifts (Van den Heuvel et al., 2010, p. 74). After these two hard controls follow two soft controls: discussion about integrity in team meetings and trainings for staff aimed at moral consciousness and/or acting with integrity (Van den Heuvel et al., 2010, p. 74).

Van den Heuvel et al. have found that there is a difference between the policy effectiveness of large and small municipalities. Large municipalities evaluate their policy more effective

24

Dunn, W.N. (2008). Public Policy Analysis: An Introduction. Upper Saddle River, NJ: Pearson/ Prentice Hall (fourth edition). 

25_{Hoogerwerf, A. & M. Herweijer (2008). Overheidsbeleid: een inleiding in de beleidswetenschap.}

Alphen aan den Rijn: Kluwer.

26

Tankeren, M.H.M. van (2007). Het preventieve integriteitsbeleid van de politie Amstelland. Een onderzoek naar de werking en effectiviteit. Amsterdam: Politie Amsterdam-Amstelland/Vrije Universiteit Amsterdam.

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than small municipalities. Between 93 and 100% of the large municipalities evaluate their policy as quite or very effective, while 70% the smallest municipalities assess their policy as effective and 63% of the municipalities between 50.000 and 100.000 inhabitants assess their policy as effective (Van den Heuvel et al., 2010, p. 75). To conclude: municipalities with more resources and more policy instruments assess their effectiveness most positive.

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4. Methods and research design

In this chapter the methods and research design that will be used to answer the research question will be discussed. A mixed research method will be used in this research. The first part of the research is a semi-large N research, while the second part of the research is a comparative case study.

Paragraph 4.1 discusses the research design of this research. Paragraph 4.2 elaborates on the variables of this research. The third paragraph of this chapter accounts for reliability of this research. Paragraph 4.4 discusses the limitations of this research, while paragraph 4.5 provides information about the analysis.

4.1 Research design

The research design to answer the research question consists of two parts. Paragraph 4.1.1 elaborates on the quantitative part of the research. In this part the integrity management of 4327 municipalities will be assessed on characteristic features in a quantitative approach. Paragraph 4.1.2 discusses the second part of this research where a qualitative method will be adopted in order to serve as additional data source. Paragraph 4.1.3 elaborates on triangulation and discusses the advantages of mixed methods research.

4.1.1 Quantitative part

In the qualitative part a representative sample from all Dutch municipalities will be collected, by taking the factor size of the municipality and the geographic distribution into account. In this way it is possible to assess whether a difference can be observed between small and large municipalities with regard to four integrity management instruments.28 The quantitative part provides factual knowledge about the presence of integrity instruments at municipalities. This information can provide evidence on the extensiveness of integrity management of the municipalities.

The quantitative data will be retrieved by information of the director of municipality or other civil servants. These persons will be contacted by e-mail with the question if their municipality has the four integrity instruments. This information is needed to answer the question whether there is a difference between large and small municipalities. This is the primary source for this thesis, which provides evidence to test theories. After the analysis of this information an assessment can be made whether there is a difference between the several municipalities to test the hypotheses.

27_{The goal of this study was to examine fifty municipalities. In paragraph 4.1.1.2 information is}

provided about the number of approached municipalities and the response.

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