Africans fail leadership test yet again as $5m prize gathers dust

One of the world's most lucrative prizes went begging yesterday after judges failed to find any African leader worthy of the $5m (£3.1m) award for excellence in leadership.

The Mo Ibrahim Foundation, set up by the Sudan-born British telecoms billionaire, decided for the third time in six years that no one met its criteria. Defending the decision not to name a laureate, Mr Ibrahim said the credibility of his award was at stake: "You make your bed, you have to lie on it. If we said we're going to have a prize for exceptional leadership, we have to stick to that. We are not going to compromise."

Earlier this month the former BT engineer made a one-off "extraordinary award" to South African archbishop Desmond Tutu, lauding him as one of the "great voices" for justice, democracy and freedom. The move prompted much speculation that the glitzier leadership award may skip a year once again. The last Mo Ibrahim laureate was given to Cape Verde's former president, Pedro Verona Pires, who won the 2011 prize ending a two-year drought. Mr Pires was hailed for transforming the former Portuguese colony, an archipelago of half-a-million people off West Africa, from a one-party state into a multi-party democracy and substantially improving living standards.

Some observers, however, questioned the value of awarding a sum equivalent to $10 for every citizen of Cape Verde to a single individual. The lavish prize, which is paid in instalments over the first 10 years and followed by a pension of $200,000 for the remainder of the winner's life, has been controversial since its inception. To qualify, an elected leader must leave office voluntarily after being shown to have raised living standards during the time in the job. After an honorary award to Nelson Mandela in 2006 and quickfire prizes for Botswana's Festus Mogae and Mozambique's Joaquim Chissano, the foundation has struggled to find credible laureates.

Democratic progress on the 54-nation continent has been uneven. This year's controversial re-election of Angola's President Jose Eduardo dos Santos, who has ruled since 1979, is not unusual. The high-profile award was initially praised for focusing attention and real financial incentives on ending the era of the African "big man" who would die in office. Everyone knows the authoritarian relics, like Zimbabwe's Robert Mugabe, said Mr Ibrahim. "But nobody knows the good guys. The prize is to bring forward a picture of the good side of Africa," he said. "Africa is not necessarily a terrible place."

But in recent years Mr Ibrahim has been forced both to deny accusations that his own fortune had dwindled during the global financial crisis and that his prize has served to highlight the poor quality of governance in much of sub-Saharan Africa. Mary Robinson, former president of Ireland and a foundation board member, said that finding three winners had been "inspiring" and that other continents would struggle to produce an annual candidate. "Speaking as a European, I don't think in six years we would necessarily have three European leaders who would qualify," she said during the announcement yesterday.

The Mo Ibrahim Index, also released yesterday, found Egypt, Kenya, Nigeria and South Africa – four of the continent's largest economies – had been backsliding on governance.

Overall the index found African governments were doing better than they had been in 2000, especially on health and gender equality, but many of its best performers were smaller states such as Mauritius.

Africa's finest? the contenders

John Kufuor The former Ghanaian president is one of Africa's good news stories, but has been overlooked many times, perhaps because he has been heavily garlanded elsewhere.

Rupiah Banda Having conceded defeat to Michael Sata in Zambia last year, Banda's reputation was tainted by efforts to shield corrupt predecessor Frederic Chiluba.

Thabo Mbeki Disastrous handling of South Africa's HIV/Aids crisis saw him usurped by Jacob Zuma in 2008. Trying to save reputation as peacemaker in the Sudans.