Regulatory Networks and Global Governance

There has not been a retreat but a transformation of the state, involving significant changes in both the public sphere of politics and the so-called private sphere of economic activity, and in their modes of interaction, especially law. The privatization of state-owned assets and the reduction of direct state economic intervention have not led to a reduced role of the state but to changes in its form, involving new types of formalized regulation, the fragmentation of the public sphere, the decentring of the state and the emergence of multi-level governance. This has been complemented by the increased salience of `private’ regulation, so that in many ways the apparently private sphere of economic activity has become more public. In fact, there has been a complex process of interaction with a blurring of the divisions between apparently private and public regulation. Despite talk of deregulation there has been extensive reregulation, or formalization of regulation, and the emergence of global regulatory networks, intermingling the public and the private. The transition from government to governance means a lack of a clear hierarchy of norms, a blurring of distinctions between hard and soft law, and a fragmentation of public functions entailing a resurgence of technocracy. The increasingly important role for regulation in global governance undermines the formalist view of law’s legitimacy as deriving from national state political structures, and requires new approaches to articulating normative interactions that are more conducive to democratic deliberation, in order to establish the public interest firmly as the prime concern in all forms of management of economic activity.? ? An earlier version of this paper was given at a workshop on Self-Governance and the Law in Multinational Corporations and Transnational Business Networks at the International Institute for the Sociology of Law, Onati, in June 2005. I am grateful to the participants in and organisers of that workshop, especially Gerd Winter, for comments. Further comments welcome to [email protected]. This paper is partially based on research conducted as part of a research programme supported by the Economic and Social Research Council under its Research Fellowships scheme, and I am extremely grateful to the Council for the opportunity for an extended period of research and writing.