In Defense of Fair Play: What’s Next for Political Finance Transparency in 2025?

The world is increasingly trying to tackle the unruly world of political finance. Just as it does so, new threats loom larger on the horizon. Those threats cannot be tamed without the help of civil society.

By Joseph Foti

Democracy is, at its heart, a political contest. However, when huge sums of money get into politics, it can lead to dysfunction and corruption. New tech and finance tools may heighten these risks.

Addressing this will require new rules. New standards from Transparency International and others seek to help civil society groups support changes in laws and rules to make it clear who is funding elections and how.

The Basics

Transparent political finance can falter at the most fundamental step: creating basic legal frameworks. Simple rules need to include limiting contributions from some donors, simple disclosure requirements, and public reporting mechanisms. Without these baseline protections, political financing remains a black box, allowing illicit funds to skew electoral outcomes with minimal oversight.

Yet, in many countries, even these foundational laws are incomplete or poorly enforced. According to the Global Data Barometer, while 94 percent of countries in the Open Government Partnership (OGP) require collection of basic political finance data, only 54 percent require its publication. Further, a mere quarter of members publish that data in a machine-readable format.

Civil society organizations (CSOs) must continue advocating for basic transparency and accountability reforms, ensuring that every democracy has at least the basic tools to make political financing transparent. Basic laws don’t just level the playing field; they build the foundation for more complex reforms. In addition, regulatory authorities alone cannot identify all potential violations of political finance laws. Enforcement also requires the input and participation of independent watchdog groups, journalists, and everyday citizens who keep an eye out for illicit finance or illegal spending. They need the means to report those problems to authorities.

But “old-fashioned” finance laws of a decade ago will not, by themselves, do the trick. New threats to the integrity of elections require new responses.

The Frontiers

Even where the basics are in place, the integrity of electoral finance faces new, complex threats.

Contribution limits and transparency requirements, while generally positive, have contributed to a new challenge: indirect giving. While not entirely new, tracing indirect donations has become increasingly difficult. Straw donors — individuals used to obscure the true source of contributions — remain a persistent challenge, allowing those with deep pockets to funnel money into campaigns without detection. This can be particularly problematic when such donations hide foreign contributions, illegal in most countries. These can also include corporate donations, which are not allowed in many jurisdictions. Spotting these indirect contributions requires transparency across the donation chain. For example, India recently scrapped its “electoral bond,” system which allowed donors to anonymously contribute to political parties. These “bonds” were actually gifts that one could not technically track back to their often sizable donors.

Also of concern is the rise of cryptocurrency and other virtual assets in campaign finance. Because the digital currencies offer anonymity and ease of transfer, they make it increasingly difficult to trace the origin of political donations. The decentralized nature of many cryptocurrencies makes it harder to enforce existing laws and to figure out who is responsible for illegal transactions. Cryptocurrency interests made headlines as the largest donor by industry in the most recent U.S. election. Well before this, however, the Financial Integrity Network uncovered significant evidence of Russia moving money into U.S. campaigns through cryptocurrencies.

Non-financial contributions — or “things of value” — also pose a subtler, but equally significant, threat to electoral fairness. These can include in-kind donations like free advertising, discounted services, favorable media coverage, or even the provision of campaign infrastructure and staff. Such contributions often go unregulated or underreported, allowing the powerful to exert influence without a financial trace. In the U.S., lavish gifts are at the heart of accusations with Senator Bob Menendez and New York Mayor Eric Adams. In Malaysia, the 1MDB scandal involved the diversion of funds to political advertising and travel. Russia also donates media support to Kremlin-friendly candidates in numerous European states, both overtly and covertly, threatening integration and stability.

A final form of illegal “contribution” is essentially a form of embezzlement or corruption — the “abuse of state resources.” This is where incumbents leverage public funds, government vehicles, state-owned media, or even civil service staff to support their campaigns. In Zimbabwe, under dictator Robert Mugabe, the long-ruling party Zanu-PF regularly used government-owned buses and funds to support party activities. Similarly, Venezuela’s Nicolas Maduro uses state-run media to promote his candidacy and uses the state oil fund to reward supporters on a personal basis. This not only gives them an unfair advantage but also erodes public trust in electoral processes, as state resources are meant to serve the public, not individual political ambitions. Such practices blur the line between state functions and partisan activity, making it difficult for opposition parties to compete on a level playing field. To combat this, campaign finance reform must include strict provisions preventing the misuse of public assets for political purposes, paired with strong oversight mechanisms.

Government alone cannot solve all of these problems. Civil society organizations have several roles to play in heading off these major threats.

• Problem-solution identification: CSOs need to take part in identifying where gaps in the existing framework and political opportunities lie.
• Reform advocacy: CSOs can play a pivotal role in advocating for updated laws and regulations, especially around new threats and disclosure requirements.
• Proof of concept: They also play a role in building “demonstration projects” that can house and visualize the data.
• Monitoring: CSOs are vital in monitoring and exposing such abuses, advocating for transparency, and ensuring that governments are held accountable for the fair use of state resources during elections.

Interoperability and Standardization

Campaign finance — especially illicit campaign finance — increasingly crosses borders. It also is incredibly fungible — a donation becomes a bribe, which in turn becomes illicit enrichment or laundered money. Interoperability means joining up data and people.

Joined up data requires “common identifiers.” In particular, this means making sure different datasets “speak” to each other. For example, ensuring that campaign income matches campaign spending is fundamental. This requires at least two datasets. Ensuring that single donors also disclose employers and that those donations can be analyzed as a group is essential.

Beyond individuals, the threat of illicit, covert transnational finance requires the cooperation between governments on this issue. Global political movements are increasingly coordinated. There is absolutely nothing wrong with this, of course, but when money becomes involved, there are other problems. Without a unified approach to transparency, illicit political contributions may simply move from one country to another, exploiting legal gaps wherever they exist.

CSOs often already work across borders. International collaboration is critical to closing these loopholes. Data-sharing initiatives, cross-border investigations, and a push for harmonized standards can help to close some of the loopholes.

The Path Forward

The challenge of ensuring transparent and accountable campaign financing is monumental, but the roadmap is clear. Countries need to establish the basics — simple, robust laws that make political financing transparent and equitable. At the same time, new or old laws must clearly empower regulators and the public to oversee emerging threats like cryptocurrency and corporate donations. Finally, those approaches can be more effective where they adopt and develop interoperable, standardized data.

CSOs have a critical role to play at every step. The path forward may be complex, but it’s one that can — and must — be traveled.