From February 15th to March 1st, LIS-Water debated the issue of regulator governance and regulatory models for water services, within the framework of integrated training in the Program for the improvement of public policies and regulation of water and sanitation services in Latin America and Caribbean. This program has 200 participants, from 40 regulators in 19 countries in the LAC region, and is taught in Spanish, Portuguese and English.

Jaime Baptista, president of LIS-Water, made a presentation on the key contents of the theme. What aspects to consider when defining the regulatory approach? How to structure a regulator? What options to consider and take? Which regulatory model to define? What resources are needed? These were some of the questions answered. Júlio César Aguilera, consultant for the Inter-American Development Bank, presented the external and internal elements to be taken into account in the architecture of a regulatory agency. Alejandro Jiménez, director of SIWI’s Department of Water and Sanitation, described accountability principles and best practices. Three presentations then provided an overview of regulation in three regions of the world through the associations of regulators in those regions. We sought to discuss: How did regulation evolve in these regions? What are the trends in the governance of regulators? What regulatory models do they use? What challenges and lessons learned? Oscar Pintos, President of ADERASA, gave an overview of the situation in Latin America and the Caribbean. Yvonne Magawa, ESAWAS project manager, gave an overview of the situation in East and Southern Africa. Hugo Pacheco, president of ERSARA and vice-president of WAREG, gave an overview of the situation in Europe. Finally, Jaime Baptista described the evolution of the regulation of water and sanitation services in Portugal and in Lusophony.

The final debate session, moderated by Rita Amaral, advisor to LIS-Water, summarized the main conclusions and answered questions raised by participants in the online discussion forum. The following main messages resulted:

• it is important to clarify the roles and responsibilities of the regulator in the legislation and to promote stability in governance and in the regulatory model;
• it is important to develop legally sound regulatory tools, rather than non-mandatory written guidelines;
• it is important to develop subsidiary legislation to fill gaps;
• a good combination of components of behavioral regulation of operators and structural regulation of the sector should be sought;
• the regulator should take a strategic approach to engaging and advising stakeholders in the sector and promoting a culture of accountability;
• must practice independence, gain industry respect, and use the magisterium of influence;
• should avoid sudden changes in regulatory orientation, with a collaborative and pedagogical model in preference to a command and control model;
• it is important for the regulator to communicate the justification of regulatory decisions, ensuring proportionality and equity;
• the regulatory model must be flexible and adapt to the context in which it is developed, as a single approach may not be ideal;
• it is important for the regulator to carry out a good mapping of operator and user behavior and include behavioral economics in regulatory projects;
• must be proactive, detecting potential opportunities and risks, in an early analysis;
• must encourage technological and process innovation (quality management);
• must promote the progressive realization of the human right to water and sanitation (social commitment);
• must minimize the cost of compliance by operators without excessive regulatory requirements, and synchronize reporting periods;
• should seek more assertiveness to achieve full cost recovery, resolve the investment gap versus reducing inefficiency;
• must promote corporate governance of providers;
• must incorporate key performance indicators, namely in environmental, social and governance issues;
• must apply regulatory impact analysis in the decision-making process;
• must create an adequate internal organization, with agile and optimized processes and with highly qualified and motivated human resources, under a strong, clear and recognized leadership.