Legitimacy and the Competition for Regulatory Share - J. Black
Julia Black Legitimacy and the Competition for Regulatory Share
breaches the Code. However, when a company declines the jurisdiction of the
PMCPA or is expelled by the ABPI, the MHRA agrees to take over consideration of
the complaint. Ideally, therefore, the state and the non-state systems interact to
provide a mutually reinforcing regulatory regime.
Examples of mutual enrolment also exist at the EU level. As noted above, the
EU has in effect enrolled the International Accounting Standards Board to formulate
accounting standards for EU member states by requiring those states to comply with
the IASB’s rules. In environmental regulation, the EU encourages firms to adopt a
non-legal standard of environmental management: EMAS (Eco-Management and
Audit Scheme). After a brief period when it differentiated itself from, and competed
with, other standards, EMAS now incorporates the environmental management
formulated by the transnational, non-governmental standard-
standard ISO 14001,
setting body, the International Standards Organisation. At the national level, the UK
Environment Agency encourages firms to adopt EMAS through bureaucratic
incentives: firms that comply with EMAS will be regarded as posing lower risks under
the Agency’s risk-based rating framework and thus will receive fewer inspections.
Governmental bodies can also enrol non-state regulators by seeking certification
themselves from non-governmental regulators. The Forestry Commission, as a
manager of woodland and supplier of wood, has sought and gained certification for its
wood products from the Forest Stewardship Council. The Environment Agency is
accredited under the ISO 14001 standard for its own internal environmental
management. Governments are assessed by non-governmental actors for
compliance with their norms; Transparency International provides a good example. 23
HE CHALLENGES OF POLYCENTRICITY
The above examples give only glimpses of the ‘new’ regulatory landscape, but,
hopefully, enough to illustrate the fact that frequently, governmental and non-
governmental regulators interact in the production of a regulatory regime in a myriad
of ways. Decentred or polycentric regulatory regimes pose four central challenges:
functional, systemic, democratic, and normative. These challenges are in part
exogenous; they exist outside the regulatory regime in that they are standards or
criteria of evaluation. But they are also endogenous; they exist within the regulatory
regimes in that the performance of those regimes faces these challenges, albeit in
different measures and in different ways.
Functional challenges revolve around the problem of coordination: networks of
organisations within a regulatory regime may be characterised by complex
As the Code extends beyond the legal requirements, it is possible that a promotion can be in
compliance with the law, but not the Code; the aim of the Code, however, is that compliance with the
Code is also compliance with the law.
Commission Regulation (EC) No 196/2006 of 3 February 2006; Environment Agency, Position
Statement on Environmental Management Systems, at http://www.environment-
Forestry Commission, Certification Standard for the UK Woodland Assurance Scheme (London: 2000).
21 See http://www.environment-agency.gov.uk/commercial/1075004/399393/1072778/.
22 See eg C. Scott, ‘Private Regulation of the Public Sector: A Neglected Facet of Contemporary
Governance’ (2002) 29 Journal of Law and Society 56. 7
interdependencies and may lack a central locus of authority. There may not be a body
whose role it is to act as the lead interpreter of the regimes’ rules or principles, for
example, or to otherwise steer or coordinate the activities of the multiple participants
in such a way that the regime moves towards the resolution of the problem which it
defines and also by which it is defined. 24
Systemic challenges revolve around issues of fragmentation of social systems. For
lawyers, this is particularly the challenge posed to both the identification and identity
of law by the presence of numerous normative orders, an issue debated in
international law in terms of the nature of ‘soft law’ and in legal theory journals in
terms of the challenges of legal pluralism. Which norms are ‘law’ and which are not;
what are the implications of fragmentation within law by regulatory norms, of the
fragmentation of law itself into a number of different sub-systems with no legal code
for determining their internal hierarchy, of the porosity of national and transnational
legal systems, or indeed of the extensive by-passing of law in many governance
regimes – each of these questions poses a challenge for understanding law and for
law’s understanding of itself.
Democratic challenges arise from issues of representation: who should be involved in
the decision making structures of the various components of the network; to whom
should such bodies be accountable and how. 29
Finally, normative challenges stem from normative concerns as to the goals and
operation of the regulatory regime: from competing conceptions of ‘the good’ that
should be pursued. 30
These challenges, especially the latter, are not unique to polycentric regimes, but
are enhanced by them. Of these, it is the functional, democratic, and normative which
are often articulated in terms of the legitimacy and accountability of the regimes as a
whole and of different actors within them. Most of the debates on regulators, both
state and non-state, see the next stage in the debate as being the question of how to
meet these different challenges – in particular, how to enhance the accountability and
For discussion, see eg W.. Kickert, E. Klijn, and J. Koppenjan (eds), Managing Complex Policy Networks
(London: Sage, 1997); E. Klijn and J.F.. Koppenjan, ‘Public Management and Policy Networks in the
Public Sector: A Theoretical Study of Management Strategies in Policy Networks’ (1995) 73(3) Public
Administration 437; E. H. Klijn and J. F. M. Koppenjan, ‘Public Management and Policy Networks.
Foundations of a Network Approach to Governance’ (2000) 2(2) Public Management 135; M. Castells, The
Rise of the Network Society: Economy, Society and Culture (Oxford: Blackwell, 2000).
The leading work is N. Luhmann, Social Systems (Stanford: Stanford University Press, 1995).
25 Eg G. Teubner, ‘”Global Bukowina”: Legal Pluralism in World Society’ in G. Teubner, Global Law
without a State (Aldershot: Dartmouth, 1997); B. de Sousa Santos, Toward a New Common Sense: Law, Science
and Politics in Paradigmatic Transition (Oxford: Oxford University Press, 1995).
Eg M. Koskienniemi, ‘The Fate of Public International Law: Between Technique and Politics’ (2007)
70(1) Modern Law Review 1; N. Krisch, ‘The Pluralism of Global Administrative Law’ (2005) 17 English
Journal of International Law 246.
Eg Cassese, n 11 above.
28 See eg J. Cohen and C. Sabel, ‘Global Democracy’ (2005) 37(4) NYU Journal of International Law and
Politics 763; C. Skelcher, ‘Jurisdictional Integrity, Polycentrism and the Design of Democratic
Governance’ (2005) 18(1) Governance 89; K. Dingwerth, ‘The Democratic Legitimacy of Public-Private
Rule Making: What Can We Learn from the World Commission on Dams?’ (2005) 11 Global Governance
See e.g. Krisch, n 28. ‘The re-description of international law in terms of ‘governance’ has also been
criticized as disguising or even seeking to neutralize the normative and political dimensions of
international legal regimes’ (Koskienniemi, n 27 above). 8
Julia Black Legitimacy and the Competition for Regulatory Share
legitimacy of these regulatory regimes. This is a significant question, but I want to
suggest here that the questions of legitimacy and accountability that are raised are not
just normative challenges; they are also functional challenges for the regulators
POLYCENTRICITY, LEGITIMACY AND REGULATORY
What is the relevance of these new patterns of governance, and / or our new
understanding of existing patterns of governance, for the debate on legitimacy, and
more particularly for the argument being made here – that organisations compete for
Central to that argument is a recognition that legitimacy is not, or at least not
necessarily, a question of legal validity. This is not to argue against the positivist
It is simply to say
position that law is accepted as legitimate because it is legally valid.
that in identifying the ‘legitimacy’ of governance regimes or organisations within
them, trying to do so by identifying legal validity will often be unproductive. Where
regulatory regimes are largely non-legal and where, as in transnational regimes,
infusing them with law is problematic, using only a legal concept of legitimacy will
lead us to a dead end: such regimes will necessarily lack legitimacy and any potential
for legitimacy in legal terms. They may, however, still be regarded as perfectly
legitimate by others. The Forest Stewardship Council or Responsible Care, for
example, are seen as legitimate by a number of market actors in the forestry and
chemical industries respectively, but they have no legal basis.
In many debates in law and political science, legitimacy is a normative issue:
when should an actor / institution be regarded as legitimate? But in order to
understand the dynamics of legitimacy, and thus in part to understand how regulation
operates in this polycentric context, we have to recognize that legitimacy is as much a
Legitimacy means social credibility and
sociological concept as a normative one.
acceptability – ‘a generalized perception or assumption that the actions of an entity are
desirable, proper, or appropriate within some socially constructed system of norms,
values, beliefs, and definitions’. More particularly, in a governance or regulatory
context, a statement that a regulator is ‘legitimate’ means, it is suggested, that it is
perceived as having a right to govern both by those it seeks to govern and those on
whose behalf it purports to govern. The right to govern includes the ‘right to govern
in the manner in which they are governing’, a point to which we will return below.
Organisations (regulators) may claim legitimacy, and may perform actions and enter
into relationships in order to gain it. But legitimacy is rooted in the acceptance of that
C. Schmitt, Law and Legitimacy, tr. J. Seitzer (Durham: Duke University Press, 2004).
31 W.R. Scott, Institutions and Organisations (Thousand Oaks, California: 2 ed, Sage, 2001). The arguments
in this section are developed more fully in Black, * above.
.Scott, n 32 above.
33 See discussions in R. Barker, Political Legitimacy and the State (Oxford: Oxford University Press, 1990)
and D. Beetham, The Legitimation of Power (London: Macmillan, 1991). 9
organisation by others, and more particularly, in the reasons for that acceptance.
These reasons lie in the congruence of the regime with a person’s beliefs or
Thus we have to recognize that the question ‘is this regulator legitimate’ is not
just a normative one, but an empirical one as well: ‘when is an organisation regarded
as legitimate’; in other words, when is it regarded as having a right to govern both by
those it seeks to govern and on whose behalf it purports to govern? So when
organisations compete for legitimacy, they are competing for social acceptance that
they have a right to govern.
Why are organisations, including regulators, in practice regarded as legitimate?
That social acceptance comes from the regulator’s different ‘legitimacy communities’
which operate in its environment. Institutionalist theorists identify three sets of
reasons for social acceptance: pragmatic, moral and cognitive. Legitimacy may be
pragmatically based: the person or social group perceives that the organisation will
pursue their interests directly or indirectly. It can be morally based: the person or
social group perceives the goals and / or procedures of the organisation to be morally
appropriate. Finally, legitimacy can be cognitively based: the organisation is accepted
as necessary or inevitable. Therefore, that acceptance may be derived from one or
more of three sources: the giver’s own pragmatic self-interest, from their normative
assessment of the organisation against a range of (competing) criteria, or from their
more deep-rooted, cognitive, and unquestioning acceptance of the organisation.
Legitimacy thus lies as much in the values, interests and expectations, and
cognitive frames of those who are perceiving or accepting the regime as it does in the
regime itself. However, different people’s perceptions of whether an organisation is
legitimate are not necessarily based on the same types of evaluations. B may perceive
an organisation or set of institutions (A) to be legitimate because it embodies a
particular religious ideology, or because it is pursuing a goal which B judges to be
normatively good (sustainable development; pro-life; euthanasia; animal rights; free
trade). Alternatively, C may perceive A to be legitimate because it is procedurally fair
in its conduct, or because it is pursuing C’s interests.
Legitimacy is also associated with the roles that are being performed. Role-
legitimacy is particularly relevant when considering the role of non-state regulators, as
not all organisations will be perceived as legitimate in performing regulatory roles. An
NGO, for example, may be perceived by some as legitimate in performing a role as a
lobbyist, but not as a regulator; just as an aid organisation may be perceived as
Beetham, n 34 above, 11; M. Weber, ‘Bureaucracy’ in H.H. Gerth and C. Wright Mills (eds), Max
Weber, Essays in Sociology (London: Routledge, 1948), 213; J. Habermas, Legitimation Crisis (London: Polity
Press, 1973), though leaving aside for the moment how these values are themselves grounded (eg the
Habermasian position that the validity claim of norms lies in rationally motivated agreement and the
counterfactual supposition that the norms could be ‘discursively redeemed’, ie grounded in the consensus
of participants through argumentation (Habermas ibid 105).
M. Suchman, ‘Managing Legitimacy: Strategic and Institutional Approaches’ (1995) 20(3) Academy of
Management Review 571; L. G. Zucker, ‘Institutional Theory of Organizations’ (1987) 13 Annual Review of
Sociology 443. A fourth form of legitimacy, charismatic legitimacy, is also noted by these writers.
Suchman, n 36 above; Zucker, n 36 above.
Julia Black Legitimacy and the Competition for Regulatory Share
legitimate in providing humanitarian relief for those affected by civil war but not in
lobbying for regime change.
Finally, we know from work on compliance that legitimacy is also affected by the
manner in which regulators perform their roles. Work on compliance with state-
based regulators and regulatory norms suggests that the observance by regulators of
principles of ‘fairness’ or ‘due process’ (colloquially defined) affects people’s
assessment of their legitimacy and in turn, those person’s propensity to comply.
Assessments of regulators’ ‘legitimacy’ can thus differ significantly across time
Legitimacy claims may
and space, and between actors, systems, and contexts.
change, and organisations can lose legitimacy from a particular legitimacy community
as the claims of that community change to require conformance to a different set of
values. But legitimacy can also resilient – legitimacy communities may ‘forgive’
individual transgressions by organisations. Conversely, an organisation may not be
regarded as legitimate by other legitimacy communities because it does not conform
to their pragmatic, normative and / or cognitive claims. In other words, the regulator
is not serving their self-interests; and / or does not conform to their normative
criteria; and / or because there exist significant and deep-rooted cognitive barriers to
accepting the regulator as being legitimate. These barriers to legitimacy, particularly
cognitive barriers, it is suggested, are as important in understanding the dynamics of
the contest for legitimacy as the reasons why it may be bestowed.
It is worth exploring the nature of the claims that are usually made on regulators
more closely to explain how the differences in legitimacy claims can arise. Take first
cognitive legitimacy. Cognitive legitimacy is based, in the regulatory context, on the
almost unquestioning acceptance of an organisation having a right to govern. NSRs
cannot gain this cognitive legitimacy from their formal legal status, but they may gain
it through the way that they operate. Meyer and Jepperson, for example, argue that
there has developed a particular model of actorhood – of rational, purposive action in
. M. Edwards and D. Hulme (eds), Non-governmental Organisations: Performance and Accountability (London:
T. Tyler, Why People Obey the Law: Procedural Justice, Legitimacy and Compliance (New Haven: Yale
University Press, 1990); T. Tyler, ‘The Psychology of Legitimacy: A Relational Perspective on Voluntary
Deference to Authorities’ (1997) 1 Personality and Social Psychology Review 323-345; V. Braithwaite and M.
Reinhart, ‘Taxation Threat, Motivational Postures and Responsive Regulation’ (2007) 29(1) Law and Policy
137; V. Braithwaite, J. Braithwaite, D. Gibson, and T. Makkai, ‘Regulatory Styles, Motivational Postures
and Nursing Home Compliance’ (1994) 16 Law and Policy 363.
This differs slightly from Beetham, n 34 above, 10, who argues they rest solely on the characteristics of
the regime, although he also states that what is significant is the resonance that those characteristics have
for different actors within and outside the regime; however, he is not so concerned with delineating the
differences between legitimacy communities.
Although as Suchman argues, the resilience of legitimacy is linked to its basis: pragmatic legitimacy is
less resilient than moral or normative legitimacy, which is in turn less resilient than cognitive legitimacy.
For discussion, see Suchman, n 36 above; Zucker, n 36 above.
For example, different parts of an organisation may simply reject what another tells them, simply
because of where it has come from - management, or from compliance, or the union (eg Neil
Gunningham’s LSA paper on management-based regulation in mines in Australia – deep-rooted
antagonism of miners to management and so refusal to adopt any management edicts or systems
irrespective of any functional value they may have). The same can be true for organisations and those
outside them. 11
which organisations can exert control over the messy world which surrounds them.
Organisations which can present themselves in this image are afforded legitimacy as it
taps into these more deep-rooted notions of what an acceptable regulatory
organisation should look like and should do.
Normative legitimacy, in the regulatory context, is frequently based on one or
more of four main sets of normative claims:
• Democratically-based claims relating to the composition and / or deliberative
procedures of the regulator
• Goals / values-based claims relating to the goals or values that the regulators is
• Constitutionalist-based claims relating to the extent to which the regulator
conforms to what may be loosely termed ‘constitutional’ values such as
proportionality, transparency, consistency, or broadly framed ‘rule of law’
values of rules which are open, stable, clear and prospective (even though
their norms may be soft law)
• Functionally-based claims relating to the values such as the effectiveness,
expertise, speed, and efficiency of the regulator.
However, as noted above, the extent to which regulators are perceived as
legitimate is not only based on cognitive and normative assessments, but on pragmatic
assessments. Pragmatic legitimacy is often excluded from legal and political science
accounts of legitimacy (indeed seen as an illegitimate form of legitimacy), but it can be
significant in practice, even though it may be normatively undesirable.
of ‘responsible consumerism’, for example, in which consumers make purchasing
decisions not just on the price and quality of goods, but on peripheral attributes such
as the conditions of their production (labour rights, sustainable development) or the
terms of their economic transfer in the supply chain (fair trading), mean that firms
both on the supply and demand side can have a significant pragmatic and economic
self-interest in complying with social and economic norms that bodies such as FSC
generate, as consumers consider these regulators to be legitimate on normative
grounds. The FSC’s legitimacy is thus pragmatically-rooted for some (e.g. suppliers),
and normatively-based for others (consumers).
J.W. Meyer and R.L. Jepperson, ‘The ‘Actors’ of Modern Society: The Cultural Construction of Social
Agency’ (2000) 18(1) Sociological Theory 100.
See also Bernstein and Cashore, n 1 above. On the role of self-interest in the compliance with ISO
14001 standards, see M. Potoski and A. Prakash, ‘The Regulation Dilemma: Cooperation and Conflict in
Environmental Governance’ (2004) 64(2) Public Administration Review 152.
Bernstein and Cashore, n 1 above.
45 Of course some consumers may see the FSC as legitimate as it is in their self-interest to do so, and
some suppliers may see the FSC as legitimate on normative grounds, for example because they support
the goal of sustainable development. 12
Julia Black Legitimacy and the Competition for Regulatory Share
COMPETING FOR LEGITIMACY
In one sense there is nothing original in pointing out that different groups of people
value different things, though normative assessments of legitimacy made by academic
writers can sometimes overlook this point. But the point being made here about
fragmented legitimacy communities is somewhat different. It is that the fragmentation
of legitimacy communities and their competing claims pose a functional challenge for
regulators, particularly non-state regulators, not just a normative one for academics or
How and why does this functional challenge arise? This question brings to the
fore a key issue which discussions on state-based regulators obscure: an awareness of
why regulators need legitimacy. The answer is that all regulators, including non-state
regulators, need legitimacy because legitimacy is a critical element in motivating
behavioural responses. Regulators require not only that others accept them, but that
they change their behaviour because of what of the organisations or standards say.
NSRs have a particular problem, because unlike state-based regulators whose
actions are supported by law, non-state regulators cannot necessarily rely on the
authority of law to motivate people to behave, or derive their legitimacy from their
position in a wider legal order and constitutional settlement. They have to create the
motivation for compliance or change in some other way. That can include trying to
render themselves legitimate to states in an attempt to attract support, for example by
enacting their norms into law. Non-state regulators may then be linked to state actors
in ways within a regulatory regime which mean that they can ‘borrow’ on the
legitimacy of the state (e.g. state actors could choose to adopt their norms, and indeed
turn them into law, such as the EU’s adoption of IASB standards in accounting).
However, such links may not exist for others, or for the same organisation in a
different legal jurisdiction. Or NSRs will often enrol others to enforce their
standards, expanding the number of organisations participating in the regulatory
regime. Such enrolment does not avoid the need for legitimacy, however, but
enhances it and often raises the issue of role legitimacy (is an NGO a legitimate
‘enforcer’ of standards, for example).
Distinguishing state from non-state regulators in this context does not mean that
state-based regulators are always perceived as legitimate, and compliance is necessarily
forthcoming (or indeed that the state is always absent in polycentric regimes).
Research into compliance with state-based regulatory requirements shows that how
people respond to regulatory regimes can depend significantly on their perceptions of
For exception, see eg C. Harlow, ‘Global Administrative Law: The Quest for Principles and Values’
(2006) 17 European Journal of International Law 187-214.
Suchman, n 36 above.
48 By which are included legally constituted regulators in the EU.
49 For discussion of cooperative strategies in the transnational context, see A. Chayes and A.H. Chayes,
The New Sovereignty: Compliance with International Regulatory Agreements (Cambridge, Mass.: Harvard University
J. Black, ‘Mapping the Contours of Contemporary Financial Services Regulation’ (2002) 2 Journal of
Corporate Law Studies 253; D. Kerwer, ‘Holding Global Regulators Accountable: the Case of Credit Rating
Agencies’ (2005) 18(3) Governance 453-475; id, ‘Rules that Many Use: Standards and Global Regulation’
(2005) 18(4) Governance 611. 13
the legitimacy of those regimes and the particular regulator in question. But although
legitimacy is central to motivating behaviour in all regulatory regimes, it is particularly
critical for non-state regulators who do not necessarily have the legitimacy of the state
or supranational or international settlement to fall back on. For them, satisfying
multiple legitimacy communities (or rather a certain set of legitimacy communities) is
particularly necessary if their authority is to be recognized and accepted, and thus for
their continued survival as a regulatory body. State-based regulators can borrow on
the authority of the state or the international legal regime to bolster their legitimacy
claims, but non-state regulators need to build legitimacy from the start.
Legitimacy is therefore essential to the regulator’s ability to function effectively,
in other words to be able to regulate others. But there is an added dimension to the
need for legitimacy. It is that more than one NSR can be trying to regulate others who
are operating in the same regulatory domain. Often, as Meidinger notes, a code
sponsored by a non-governmental organisation is countered by one sponsored by
industry. Thus in forest stewardship, for example, there are two main NSRs – the
FSC, the industry-sponsored Program for Endorsement of Forest Certification.
the competition may not fall so neatly into industry versus non-industry. In the realm
of fair trade, for example, both the Fair Trade Labelling Organisation and the World
Fair Trade Organisation have sets of standards and certification processes, which
although they serve similar markets and seek to make the same kinds of appeals to
consumers, are based on different approaches to Fair Trade monitoring and
certification. Regulators, particularly NSRs, thus may find they have to compete with
each other for ‘regulatory share’. In this competition, legitimacy can play a key role.
COMPETING FOR REGULATORY SHARE
The idea that non-state regulators have to compete for regulatory share might sound
an odd notion to administrative lawyers, who by their nature focus largely on state
based regulators that form part of the administrative structures of government. These
state regulators may have to ‘compete’ with other regulators in other jurisdictions in
order to attract business, and they may overlap or otherwise have to coordinate with
other regulators in the same jurisdiction, for example the concurrent competition
powers of sectoral regulators and the OFT or overlapping responsibilities for water
quality between the Environment Agency and Ofwat, but they do not have to
compete with each other to try to get firms or others to follow their rules rather than
those of another regulator. They do have to ensure that firms abide by the regulatory
rules and not their own organisational or industry norms, but as organisations, their
regulatory remits are secure, because they are legally defined and sanctioned. Some
See in particular Tyler, n 39 above (1990 and 1997); Braithwaite and M. Reinhart, n 39 above;
Braithwaite, Braithwaite, Gibson, and Makkai, n 39 above. See also A. Chayes and D. Shelton,
‘Commentary: MultiLateral Arms Control’ in D. Shelton (ed), Commitment and Compliance: The Role of Non-
Binding Norms in the International Legal System (Oxford: Oxford University Press, 2000).
Meidinger, n 1 above; see also Abbot and Snider, n 1 above.
Julia Black Legitimacy and the Competition for Regulatory Share
non-state regulators, such as the GMC, are in a similar position in that they have been
granted a legal monopoly to regulate a certain group of people (doctors).
Moving beyond the boundaries of state-based or state-sanctioned regulators,
however, there is a plethora of non-state organisations which attempt to regulate
firms or others in accordance with a set of norms, and which have no state
endorsement or backing at either national or international level. There are multiple
examples at the transnational level, such as the Fair Trade Labelling Organisation, the
Forest Stewardship Council and the Marine Stewardship Council. At the national
level, within the UK there are both industry and non-industry based codes. In the area
of food, for example, there is the Red Tractor logo of the Assured Food Standards
organisation, as well as the non-industry based RSPCA’s ‘Freedom Food’ certification
and labelling scheme. It is open to industry to seek OFT approval of their Codes, but
this does not give them legal force and is in any case voluntary.
The codes and practices of NSRs are usually discussed either as manifestations of
the phenomenon of governance or decentring, or in terms of the challenges of
decentred regulation outlined above: functionally -- how effective are they in changing
industry behaviour; normatively -- do they only further the self-interest of their
member firms or do they seek to pursue a broader social goal; constitutionally -- what
challenges do they pose to constitutional norms such as accountability; or systemically
-- how do their ‘soft’ law norms interact with ‘hard’ law and what does this interaction
and fragmentation mean for our understanding of ‘law’ and law’s understanding of
What I am suggesting here is that, in addition to those discussions, we see the
regulatory norms themselves as part of a dynamic process by their sponsoring
organisations to expand the regulator’s ‘regulatory reach’. Where the organisation is
the sole body producing norms in a particular domain or sector, then their challenge is
to get industry or other organisations to recognize and comply with those norms.
Where they are not the sole body producing norms which purport to govern a
particular sector or activity (ie food production, animal welfare, accounting norms),
then the NSR may be implicitly or explicitly in competition with other organisations,
which may in turn be either state-based or state-sanctioned regulators or non-state
regulators. In these circumstances, the challenge for the non-state regulators (NSRs) is
not just to gain compliance as such, but to compete against other rival regulators in a
battle for ‘regulatory share’.
This idea that non-state regulators compete for regulatory share is unfamiliar to
administrative law discourse (as it is to much regulatory discourse as well), and as such
requires some unpacking. The argument runs like this: I have argued above that
organisations need legitimacy to survive, but that there are multiple legitimacy
communities, each with competing legitimacy claims. NSRs need to gain legitimacy
from those they seek to regulate. Frequently, the charge is that they do so by writing
rules which favour industry. However, non-state regulators, particularly those who are
attempting to regulate the conditions of production (Fair Trade, Rugmark, FSC, etc)
also need to have the support of consumers if the NSR is to be effective in
State-based regulators can also compete for regulatory share by attempting to ‘export’ their regulatory
norms; we will return to this issue below. 15
stimulating demand-side pressures for compliance. In other words, they need to be
legitimate to consumers, as well. It is therefore not enough for them simply to write
rules that render them legitimate to firms (eg by being in the firms’ self-interests), they
have to make themselves legitimate to a wider range of legitimacy communities, who
may be making competing legitimacy claims. -
EGITIMACY AND REGULATORY COMPETITION CREATING AND MANAGING
So how can regulators create and manage their legitimacy? Again the idea that
regulators, both state and non-state, ‘create and manage’ their legitimacy may be a
strange notion to constitutional or administrative lawyers, who are used to thinking in
terms of evaluating the legitimacy of regulators in a context in which the regulator is
implicitly assume to be a passive agent, an ‘object’ which can be evaluated. But
regulators, like states, or indeed any organisation, can play a role in constructing,
maintaining and repairing their own legitimacy in three main ways: by conforming,
manipulating, or informing. They can conform to the ‘legitimacy claims’ of
legitimacy communities, for example by pandering to their self-interest, or by trying to
conform to normative claims by making themselves more representative, or more
expert, or more transparent, or by aligning themselves with someone who has those
qualities, and so building legitimacy networks.
Many state-based regulatory agencies, for example, have developed systems of
public consultation, decision-making, and reporting which go well beyond those
required by law to enhance their normative legitimacy. Non-state regulators also can
seek to manage their legitimacy, both out of self-interest and because they perceive it
to be the ‘right thing to do’ -- in March and Olsen’s terms, out of a logic of
consequences and a logic of appropriateness. The International Accounting
Standards Committee has changed its constitutional structures and membership to
enhance its legitimacy. Cashore’s analysis of the FSC’s legitimacy illustrates how the
FSC seeks to manage its pragmatic legitimacy by engaging in ‘brand-destroying’
activities against those who do not conform, thus attempting to make conformance
with its norms be in the self-interest of firms in the supply chain. However,
legitimacy-enhancing strategies can be multi-faceted, and Meidinger’s analysis of FSC
emphasises how it seeks to manage its normative legitimacy by enhancing the
democratic nature of its membership and processes.
Regulators can also seek to develop moral and cognitive legitimacy through
building ‘legitimacy networks’, in other words linking themselves to other
See e.g. S.M. Lipset, ‘Some Social Requisites of Democracy’ (1958) 53 American Political Science Review 69;
R. Merelman, (1966) 60 American Political Science Review 548; Habermas, n 35 above.
See Suchman, n 36 above; P. DiMaggio and W. Powell, ‘Introduction’ in W. Powell and P. DiMaggio
(eds), The New Institutionalism in Organisational Analysis (Chicago: University of Chicago Press, 1991).
See M. Thatcher, ‘Regulation after Delegation: Independent Regulatory Agencies in Europe’ (2002)
9(6) Journal of European Public Policy 954.
March, J. and Olsen P., ‘The New Institutionalism: Organisational Factors in Political Life’ (1984) 78
American Political Science Review 734.
Suchman, n 36 above.
59 Meidinger, n 1 above.
Julia Black Legitimacy and the Competition for Regulatory Share
organisations which are perceived to be legitimate by those whose legitimacy claims
they want to meet. For example, a number of the social and environmental
accreditation bodies have agreed to ensure that they abide by the Code of Practice
developed by ISEAL (the International Social and Economic Accreditation League)
on the development, publication, and review of standards by member organisations,
largely to enhance their credibility. Modelling can also be adopted as a strategy to
enhance legitimacy by an NSR. Froomkin, for example, argues that ICANN has
developed procedures modelled on the Internet Engineering Taskforce, which is
widely accepted as legitimate by the internet community, in an attempt to gain
legitimacy for itself. 62
Alternatively, regulators can adopt less honourable strategies than actually
conforming to normative claims and can attempt to gain legitimacy through
manipulation, pretending to conform to the perceptions of the legitimacy
communities (eg ‘green-washing’). Or they can attempt to change or manipulate the
reasons why legitimacy is being given, such as attempting to refute democratic claims
by appealing to functional claims, in other words by advancing the argument that it is
more important for them to be dominated by experts than it is for them to be
democratic, as enhancing their democratic nature would reduce their effectiveness.
This argument is one which has traditionally been used by technical NSRs, such as the
BCBS or IASB, just as it has been used in the area of scientific risk assessments and
risk management by state-based regulators.
Regulators can also increase their legitimacy by providing information on aspects
of their existing activities which they think will provide a basis for acceptance from
different legitimacy communities. This strategy can clearly be used alone or in
conjunction with the other two. The form that any of the strategies will take vary with
the type of legitimacy that is at issue: pragmatic legitimacy (based on self-interested
claims of legitimacy communities), moral or normative legitimacy (based on
assessments that this is the ‘right thing to do’), or cognitive legitimacy (based on
assumptions that things could not be any other way), and on whether the organisation
is seeking to build, maintain, or repair legitimacy. 63
Regulators can also switch between legitimacy claims in attempts to enhance
their legitimacy within different communities. Wood’s work on the ISO provides a
good illustration. When the ISO started to lose ground in its functionally-based
legitimacy claims (ie that it is technical, expert), it switched to an alternative claim, but
one which was more cognitively-rooted: that it was the most appropriate body
because of its long-standing existence and role in a related area.
ISEAL Alliance, Code of Good Practice, at http://www.isealalliance.org/
index.cfm?fuseaction=Page.viewPage&pageId=502&parentID=500. See also E. Meidinger, ‘Multi-
Interest Self Governance through Global Product Certification Programs’ (Buffalo Legal Studies
Research Paper 2006-016), at http://ssrn.com/abstract=917956.
A. Froomkin, ‘Habermas@discourse.net: Toward a Critical Theory of Cyberspace’ (2003) 116(3)
Harvard Law Review 749, 844-845.
Suchman, n 36 above, 585-601. See Cashore for consideration in the context of the FSC: B. Cashore,
‘Legitimacy and the Privatization of Environmental Governance: How Non-State Market Driven
(NSDM) Governance Systems Gain Rule Making Authority’ (2002) 15(4) Governance 503-529.
S.Wood, ‘Will ISO 26000 Corner the Market for International Social Responsibility Standards?’
Competition for Transnational Regulatory Authority (paper presented at the SLSA conference, Montreal, May
2008) (copy on file with author). 17
+1 anno fa
Materiale didattico per il corso di Theories of Regulation della prof.ssa Laura Ammannati. Trattasi dell'articolo di Julia Black dal titolo "Legitimacy and the Competition for Regulatory Share" all'interno del quale è affrontato l'argomento dell'importanza della legittimazione nell'attività di regolazione del mercato.
I contenuti di questa pagina costituiscono rielaborazioni personali del Publisher Atreyu di informazioni apprese con la frequenza delle lezioni di Theories of Regulation e studio autonomo di eventuali libri di riferimento in preparazione dell'esame finale o della tesi. Non devono intendersi come materiale ufficiale dell'università Milano - Unimi o del prof Ammannati Laura.
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