Private Transnational Regulation as Networked Governance
Law and globalization; Corporate governance--Law and legislation; Social responsibility of business--Law and legislation; International relations
The conventional treaty-based system is struggling to cope with the challenges faced by the global society. This failure is evident in various areas, including climate change, labour rights in ship breaking yards in Bangladesh, India, and Pakistan and global bio-diversity. This lecture focuses on the new hybrid system of global governance that has evolved in the past decade with the emergence of private transnational regulatory schemes and examines its regulatory capacities. In particular, the lecture exposes the network structure of the new system, focusing on the field of corporate social responsibility (CSR) and the transnational (private) codes that govern it. The field of CSR-Codes is of particular interest because it covers many of the issues that are governed by conventional public international law regimes. Professor Perez argues that analyzing the system of CSR-Codes through the prism of network theory is critical for understanding its institutional structure and its regulatory efficacy. He presents a new theoretical framework based on two ideas: ensemble regulation and networked signaling. This framework draws on three bodies of literature: network theory, transnational legal theory and theories of signaling (which were developed in parallel in economics and in biology). He discusses in this context the findings of a novel empirical study that he conducted in the past two years, which utilizes the technique of social network analysis (SNA) to study the CSR-Codes network. The empirical study is based on an extensive database that includes 61 CSR schemes and 31,987 firms. This is the first work in the transnational governance literature that undertakes an empirical study on such a scale. The study examined, first, the topology of the CSR-Codes network. Second, it considered whether there is evidence of the existence of a separating equilibrium that distinguishes between sustainable and less sustainable firms (green and greenwashers). The lecture also discusses more broadly the potential contribution of SNA to the study of law. Despite the recent advances in the use of empirical methods in legal research, it still lags behind the social sciences in the use of network analysis.
Perez, Oren, "Private Transnational Regulation as Networked Governance" (2016). Pierre Genest Memorial Lecture. 11.