Adversarialism versus legalism: Juridification and litigation in corporate governance reform

Recent reforms of corporate governance law and related litigation rules in the US and in Germany indicate that reports of the spread of adversarial legalism are greatly exaggerated. Politics and legislation in the US since the mid‐1990s have turned quite decisively against shareholder litigation even as corporate governance and securities law reforms have expanded the role and scope of the regulatory state. Germany's extraordinary expansion of financial and corporate governance regulation since the early 1990s exemplifies juridification. Although these reforms included some liberalization of shareholder litigation rules, the changes reflected skepticism towards private litigation and imposed new constraints on the most prevalent forms of shareholder suits. Marketization of economic relations and the era of finance capitalism have produced far more legalism than adversarialism, more regulation than judicialization, and more ex ante transparency rules than ex post litigation remedies.     

Public affairs,issues management,and political strategy: opportunities,opportunities, and more opportunities

This paper begins where Professor Windsor left off and enumerates some other areas in which academic research could be profitably pursued for both intellectual and practical gain. The tone of Professor Windsor's paper is pessimistic, and lays out in detail some of the obstacles to research; but these are not insurmountable. Some key areas that can be explored to the benefit of researchers and practitioners are in self‐regulation, the initiative process, term limits (a relatively recent phenomenon and not particularly well known outside of the USA), and in alliance building, constituency statutes, and links to stakeholder theory and action. Each of these additional areas is addressed in this presentation. Copyright © 2001 Henry Stewart Publications     

Disciplinary Divides in Post-Conflict Justice and Peace: Tracking If and How we Share Ideas

ABSTRACT

The study of post-conflict justice and peace incorporates ideas from many disciplines and on a range of topics including justice, reconciliation, democratization, and peace. While diversity is valuable, it can also lead to confusion in theory and practice and so requires close evaluation of how diverse ideas interact, and to what end. This paper begins the systematic examination of such interactions by using new bibliometric software to track citations between two particularly influential literatures contributing to post-conflict theory: the legal and the psychosocial. The paper describes how these traditions interact and the impact on the post-conflict literature as a whole.     

Temporary legislation,better regulation,and experimentalist governance: An empirical study

This article presents the findings of an extensive multi‐method empirical study that explored the relationship between temporary legislation, better regulation, and experimentalist governance. Temporary (or “sunset”) legislation – statutory provisions enacted for a limited time and set to expire unless their validity is extended – is often hailed as a key tool for promoting experimental and better regulation. Despite the importance of temporary legislation and the burgeoning theoretical scholarship on the subject, there is still a dearth of empirical studies about how temporary legislation is used in practice. The lack of empirical evidence creates a lacuna in at least three areas of theoretical scholarship, concerning temporary legislation, better regulation, and experimentalist governance. This paper is a first step to fill this gap.     

Complaining about rivals: Indifference,cooperation, and competition in the governance of advertising

What should rivals do when they see competitors breaking agreed rules within systems of self‐regulation? This study investigates compliant behavior among British advertisers to empirically answer this question. It analyses five years of complaints (n = 146,062) and adjudications (n = 4,832) published by the self‐regulatory body for the British advertising industry. The majority of firms adopt a strategy of indifference and rarely regulate their rivals. Highly engaged firms either adopt an angelic strategy as they use their resources to complain about their rivals; a deviant strategy as they are subject to a large number of complaints; or a predatory strategy as they attack their rivals through advertising regulation. This illustrates a unique form of regulatory capture in which a regulatory system becomes an arena of competition for some actors while continuing as a governance mechanism for others.     

Politicians,regulators, and regulatory governance: The neglected sides of the story

We offer a series of reflective insights about the state and direction of studies related to the politics of regulation. Notably we argue that the field is characterized by persisting divisions between Americanists and Europeanists. Largely focused on the actions taken by political principals, the former regularly report a substantial politicization of regulatory behavior. Reflecting on recent developments in US politics however, we show that political influence could be overestimated in the United States. Symmetrically, this same influence could be underestimated by Europeanists, who for now have largely focused on regulators and agencies. This is notably suggested by a discussion of recent development in European politics, as revealed by contributions systematically measuring agency politicization in Western European democracies. On this basis, we identify some promising research questions and agendas for future studies on the politics of regulation.     

Information, Interests, and Environmental Regulation

This study contributes to the understanding of informational approaches to bringing about compliance with environmental regulations with particular attention to differences in the influence of information provided by different information sources. Based on theorizing from a combination of information processing and interest group literatures, we develop hypotheses about regulatees' reliance upon and the influence of different sources of information. We test these hypotheses for Danish farmers' compliance with agro-environmental rules. Our findings show that information plays a role in bringing about regulatory compliance, but its influence is not as strong and is less direct than might be thought to be the case. In addition, we show that not all information sources have the same influence. The findings demonstrate that interest groups have important roles in information provision and legitimization of policies that have often been assumed in the literature but have rarely been empirically examined.     

Risk and the limits of governance: Exploring varied patterns of risk‐based governance across Europe

Risk‐based approaches to governance are widely promoted as universally applicable foundations for improving the quality, efficiency, and rationality of governance across policy domains. Premised on the idea that governance cannot eliminate all adverse outcomes, these approaches provide a method for establishing priorities and allocating scarce resources, and, in so doing, rationalise the limits of what governance interventions can, and should, achieve. Yet cursory observation suggests that risk‐based approaches have spread unevenly across countries. Based on a comparison of the UK, France, and Germany, this article explores the ways in which, and why, such approaches have “colonised” governance regimes in the UK, but have had much more limited application in France and Germany. We argue that the institutionally patterned adoption of risk‐based governance across these three countries is related to how entrenched governance norms and accountability structures within their national polities handle both the identification and acceptance of adverse governance outcomes.     

Technocracy,the market and the governance of England's National Health Service

England's National Health Service, the fifth largest employer in the world, has become heavily influenced by expert authority and the market economy, which has had implications for accountability and the receptiveness of health decisions to stakeholder needs. One response has been the introduction of a range of regulatory provisions designed to facilitate effective governance and stakeholder engagement. These provisions are scrutinized using three conceptual devices: core accountability, social reporting and social learning. These devices have significant implications, as they enable technical experts to form closed communities, communicate among themselves mainly about economic and financial matters, and make decisions that aid the market without meaningful recourse to citizens. While technical experts are necessary to help manage complex areas, current arrangements reinforce an existing gap between economic and democratic values through hardened technocratic approaches to health care governance.     

“Embedded regulation:” The migration of objects,scripts, and governance

This paper asks why an officially unregulated market in pharmaceuticals in a least developed country, Djibouti, behaves as if it were strictly regulated, with limited access to a small number of high‐cost drugs. We use Actor‐Network Theory (ANT) to show that the explanation is more complex than critics of the international pharmaceutical industry have supposed. Regulation and property rights generated in developed countries have become embedded in the drugs and “black boxed” to the point of invisibility. This has allowed them to travel to Djibouti with the drugs, while maintaining their effects in action. This case study develops our understanding of the way in which materials that are not designated as regulatory agents may still have regulatory impacts through their ability to enrol complex networks of actors, rules, values, and practices. Finally, it argues against the notion of law as a fixed and distinctive space for action, as opposed to the ANT vision of a fluid and contingent order, where law is part of a socio‐technico‐legal alliance that happens to achieve certain effects.     

Regulation and voluntarism: A case study of governance in the making

In this article I analyze a multi‐stakeholder process of environmental regulation. By grounding the article in the literature on regulatory capitalism and governance, I follow the career of a specific legislative process: the enactment of Israel's Deposit Law on Beverage Containers, which aims to delegate the responsibility for recycling to industry. I show that one crucial result of this process was the creation of a non‐profit entity licensed to act as a compliance mechanism. This new entity enabled industry to distance itself from the responsibility of recycling, and thereby frustrated the original objective of the legislation, which was to implement the principle of “extended producer responsibility.” Furthermore, this entity, owned by commercial companies and yet acting as an environmentally friendly organization, allowed industry to promote an anti‐regulatory agenda via a “civic voice.” The study moves methodologically from considering governance as an institutional structure to analyzing the process of “governancing,” through which authoritative capacities and legal responsibilities are distributed among state and non‐state actors. Two key findings are that this process and its outcome (i) are premised on an ideology of civic voluntarism, which ultimately delegates environmental responsibilities to citizens; and (ii) facilitate an anti‐regulatory climate that serves commercial interests.     

Leveson Past,Present and Future: The Politics of Press Regulation

As a result of the phone‐hacking scandal and evidence of other serious journalistic abuses by some newspapers, the government set up the Leveson Inquiry to hear evidence from victims and to make recommendations for a new and effective system of press regulation. Leveson's recommendations for independent self‐regulation overseen by a “recogniser” was seen as a moderate solution which would uphold the principle of an unfettered press while providing appropriate protection from unscrupulous or unethical press behaviour. After historic cross‐party agreement, Parliament passed a resolution accepting a Royal Charter which adopted the great majority of his recommendations. In response, Britain's main national newspapers have pursued a campaign of systematic misinformation and distortion, aimed at discrediting the inquiry, its supporters and the cross‐party Charter, while promoting a different system which would remain almost wholly controlled by the industry and would in practice be little different from the discredited Press Complaints Commission. After decades of ineffectual political response to press abuse and press power, there is now a historic opportunity for Parliament to assert its sovereign power. Over the next 12–18 months, we will see whether we have reached a genuine milestone in British public life or whether the British press will remain the last bastion of unaccountable power.     

The Political Economy of Facebook Advertising: Election Spending,Regulation and Targeting Online

Political advertising on Facebook is the latest in a long line of developments in campaign practice, and is a tool that has been mobilised extensively in elections around the world. In this article, we explore what we know about Facebook advertising at elections and ask what existing data from the UK Electoral Commission can reveal about current usage. Highlighting the principles behind Facebook advertising, we argue that existing metrics offer little insight into current campaign trends—posing analytical, methodological and normative challenges for academics and electoral regulators alike. Moreover, we argue that these challenges strike at the heart of debates about democratic responsibility and the degree to which governments should cede responsibility to commercial actors who may have differing understandings of fundamental democratic norms.     

Risking Regulation,Regulating Risk: Lessons from the Transatlantic Biotech Dispute

Debates over the future of new technologies frequently implicate governmental policies and regulation, the purpose of which has traditionally been to mitigate the dangers of new technologies through promotion of conditions of safe use. It is increasingly recognized, however, that regulation is predicated on a particular conception of the nature of risk which may or may not correspond to the views and beliefs held by society. Here I explore three broadly related questions in the context of the debates around agricultural biotechnology. First, what are the implications of varying conceptions of risk for regulatory policy in the United States and in the European Union? Second, what are the implications of differing conceptions of risk and resulting regulatory policy for agricultural trade relations between the two giants of international trade? And finally, what lessons might we draw from contemporary disputes over agricultural biotechnology?     

Why meta-research matters to regulation and governance scholarship: An illustrative evidence synthesis of responsive regulation research

This article is an introduction to meta-research, a systematic and replicable process of synthesizing research findings across a body of original research. After introducing the reader to the core of meta-research methodology, meta-research logic and tools are applied to present an evidence synthesis of empirical research on responsive regulation. The article concludes with a meta-research agenda for regulation and governance scholarship, and five key lessons from the empirical responsive regulation literature.     

Production goes global,compliance stays local: Private regulation in the global electronics industry

Poor working conditions in global supply chains have led to private initiatives that seek to regulate labor practices in developing countries. But how effective are these regulatory programs? We investigate the effects of transnational private regulation by studying Hewlett‐Packard's (HP) supplier responsibility program. Using analysis of factory audits, interviews with buyer and supplier management, and field research at production facilities across seven countries, we find that national context – not repeated audits, capability building, or supply chain power – is the key predictor of workplace compliance. Quantitative analysis shows that factories in China are markedly less compliant than those in countries with stronger civil society and regulatory institutions. Comparative field research then illustrates how these local institutions complement transnational private regulation. Although these findings imply limits to private regulation in institutionally poor settings, they also highlight opportunities for productive linkages between transnational actors and local state and society.     

Subprime catalyst: Financial regulatory reform and the strengthening of US carbon market governance

The 2008 financial crisis has had an important, but neglected, impact on carbon market governance in the United States. It acted as a catalyst for the emergence of a domestic coalition that drew upon the crisis experience to demand stronger regulation over carbon markets. The influence of this coalition was seen first in the changing content of draft climate change bills between 2008 and 2010. But the coalition's more lasting legacy was its role in shaping the content of, and supporting, the passage of the Wall Street Reform and Consumer Protection Act (the Dodd–Frank bill) in July 2010. Although that bill was aimed primarily at bolstering financial stability, its derivatives provisions strengthened carbon market regulation in significant ways. This policy episode demonstrates new patterns of coalition building in carbon market politics as well as the growing links between climate governance and financial regulatory politics. At the same time, the significance of these developments should not be overstated because of various limitations in the content and implementation of the Dodd–Frank bill, as well as the waning support for carbon markets more generally within the US since the bill's passage.     

The unstable core of global finance: Contingent valuation and governance of international accounting standards

Accounting standards are the foundations of the financial regulatory edifice, and global financial governance is no more stable than the asset valuations that feed it. Yet for two decades and up to this day, no international accounting rule for financial instruments – the bulk of banks' balance sheets – has emerged that was more than a temporary fix, to be succeeded by further reforms. We show how banking regulators have been central to this dynamic and how their support for applying fair value accounting to financial instruments, the cornerstone of regulatory debate, has oscillated throughout the whole period. The two common international political economy approaches to global financial governance, which analyze it either as interest‐based bargaining or as ideas‐driven expert governance, fail to account for this pattern. In contrast, we show how the contingency of financial valuations itself has made it impossible for regulators to embrace or reject a stable set of accounting rules.     

Uniformity as response to soft law: Evidence from compliance and non‐compliance with the Dutch corporate governance code

The objective of the paper is to examine how firms have dealt with the trade‐off between flexibility and uncertainty that is characteristic for the decision‐making of firms in coping with self‐regulatory initiatives in general and the comply‐or‐explain principle in corporate governance in particular. Using unique data for 126 listed Dutch firms, we find that firms respond to this self‐regulatory initiative by largely complying with the code recommendation, possibly out of fear that the firm's reputation may be damaged. Furthermore, we find evidence suggesting that firms confine themselves to adopting a specific set of code recommendations and use similar arguments to explain non‐compliance. Our findings indicate uniformity in adopting the standard of good governance which is not in line with the logic of corporate governance codes and casts doubt on the effectiveness of this form of soft law. Overall, the paper's findings indicate that more restrictive (regulatory) instruments may be necessary to make firms conform to the spirit of codes.     

Introduction: economic security,globalization and governance

Abstract

This introductory article examines different approaches to conceptualizing economic security by drawing on the broader social science literature beyond realism/neorealism. Arguing that traditional conceptions of economic security that see economics as a source, or instrument of state power are insufficient, it draws on a growing literature that looks directly at the economic roots of conflicts, particularly those arising from the manner in which capitalist production is organized in distinct settings. While the paper identifies a range of ways in which scholars, policy practitioners and communities think about economic security depending on the particular circumstances different states and societies find themselves in, the paper, nonetheless, argues for a notion of economic security that also emphasizes issues of justice/fairness and distributive equity. Under conditions of globalization, it is important for us to think of the needs of those made insecure by prevailing systems of market governance but in ways that do not undermine the integrity of the market nor sanction protection for chronically uncompetitive firms. Drawing on insights from International Political Economy and Economic Sociology, the paper suggests one useful way of conceptualizing economic security under conditions of globalization: that of ensuring a low probability of damage to (a) the income and consumption streams that are deemed appropriate for individual well-being; (b) the income-generating potential of an economy; and (c) some minimal level of distributive equity. To this end, appropriately designed national, regional and global institutions can function as mechanisms of governance in the interests of economic security. The rest of the papers in this Special Issue provide empirical case studies drawn from East Asia on many of the points raised in this introduction.