OECD Calls for Stronger Risk Management and Unified Control Systems in Finland

The OECD’s report on “Strengthening Internal Control and Risk Management in Finland” urges the Finnish government to move from procedural compliance toward a unified, proactive culture of risk governance. It calls for stronger coordination, modernised internal audit systems, and leadership-driven risk awareness to future-proof Finland’s trusted public administration.

A report by OECD“Strengthening Internal Control and Risk Management in Finland”, prepared jointly with the Finnish Ministry of Finance, the National Audit Office of Finland (NAOF), and supported by the European Commission’s Directorate-General for Structural Reform Support (DG REFORM), offers a deep look into how Finland can modernise its public governance. Long admired for its integrity, transparency, and low levels of corruption, Finland’s public sector faces a new generation of challenges, cyber threats, fiscal pressures, climate risks, and complex inter-ministerial dependencies. The OECD’s central message is clear: Finland must move from a rule-based culture of compliance to a dynamic, integrated system of internal control and risk management that enhances foresight, resilience, and accountability across government.

Decentralisation and the Coordination Gap

Finland’s governance model, rooted in strong ministerial autonomy, has traditionally ensured flexibility and trust. Yet this decentralisation has also created inconsistencies in how ministries and agencies manage internal control. The report finds that some ministries operate sophisticated risk frameworks, while others rely on minimal procedures limited to financial compliance. Such fragmentation, the OECD warns, hampers the government’s ability to detect and manage cross-sectoral risks that cut across administrative silos. The organisation recommends establishing a central policy function for risk management within the Ministry of Finance. This body would guide and coordinate risk activities, ensure common frameworks, and maintain consistency in reporting. The goal is not to erode autonomy but to reinforce it through shared standards and better oversight.

Reimagining the Role of Internal Audit

Internal audit, one of the strongest elements of Finland’s governance system, emerges as both a strength and an opportunity. The OECD praises the independence and professionalism of Finnish internal auditors but notes that their impact remains constrained when audits are narrowly focused on compliance. It calls for a transformation in how internal audit is perceived and utilised. Rather than serving solely as watchdogs, auditors should become partners in strategic management, promoting risk awareness and learning across the public administration. The report suggests adopting international best practices such as the COSO framework, which integrates governance, risk management, and control in a unified approach that strengthens decision-making.

A Cultural Shift Toward Risk Awareness

Perhaps the report’s most compelling insight is the call for a cultural change within Finland’s public sector. The OECD argues that formal procedures, no matter how well designed, cannot replace a genuine mindset of responsibility and foresight. Risk management should not be viewed as a bureaucratic burden but as a strategic asset that supports innovation and public trust. To achieve this, the report emphasises the need for capacity-building, staff training, and clear communication from leadership. Senior officials must set the tone by acknowledging risks openly and encouraging a culture where identifying and addressing risks early is rewarded rather than penalised. This, the OECD contends, will make Finland’s already capable institutions not just transparent, but truly resilient.

Future-Proofing Finnish Governance

The report also spotlights the urgency of addressing emerging risks, especially in digital transformation, cybersecurity, and climate governance. As Finland’s administration becomes increasingly digital, vulnerabilities expand. The OECD calls for stronger collaboration between cybersecurity experts, policymakers, and finance officials to ensure that risk governance keeps pace with technological change. It also urges harmonisation of internal control standards across municipalities and agencies to close existing gaps. Financial transparency remains a Finnish hallmark, but inconsistent application of controls can limit the government’s ability to act swiftly during crises.

Ultimately, the OECD’s recommendations are evolutionary rather than revolutionary. Finland, it argues, already possesses the credibility, professionalism, and trust that most countries aspire to. The challenge now is to build on these strengths through greater coherence, continuous learning, and modern risk governance. By embedding risk awareness into the heart of decision-making, Finland can transform its system of internal control from a static mechanism into a living framework that anticipates uncertainty and adapts with agility. In a volatile world, such an approach will not only protect public resources but also preserve the nation’s reputation as a model of clean, capable, and forward-thinking governance.