An Emerging Pattern of Global Governance

The distinctive characteristics of global governance are gaining definition. There is a tendency to frame global governance as a supranational force limiting state sovereignty, but empirical analysis suggests this conclusion is simplistic. First, many international organizations are structured around the nation-states brought together through formal treaties and agreements. The very structure of an organization that organizes participation by country reinforces the importance of states rather than undermines it, particularly compared with nongovernmental global rule makers. Second, in practical terms, constraints on national autonomy are not distributed evenly. As one would expect, some nations have more influence over the international rule-making bodies than others, reflecting the geopolitical realities of power asymmetry. Third, to the extent sovereignty is compromised, it is almost never by formal means. That is, rarely does an international organization have the power to formally sanction a member state; rather, it is a market mechanism—a cost of ignoring the rules produced by an international organization—that compels behavior. This is a more subtle impingement on national autonomy and one that is not confined to areas in which international organizations produce formal rules.

The other reality of global governance implicit in the discussion thus far is that there is nothing even closely approximating a “world government” (O'Toole & Hanf, 2002). Instead, we observe an interlocking network of global governance organizations (GGO), each part of a constellation of firms, national bodies, and interest groups. Understanding this dynamic ecosystem of transnational public administration may be more difficult than getting a grasp of the domestic political context in which public administration is conventionally understood. Indeed, global governance organizations are constantly coordinating and competing, simultaneously in many cases, with other global bodies (Dimitrakopoulos & Passes, 2003).

If understanding the nature of transnational rule-making organizations is not enough to entice public administration scholars to look beyond the borders of single nation, the increasing importance of transnational rules in a wide variety of seemingly domestic policy arenas—from food safety to energy regulation to commerce—ought to be. Though the emergence of a world government is not at hand, global rule-making bodies are increasingly part of domestic public administration in ways direct and indirect.

The intertwining of domestic bureaucracies with GGOs is not so advanced as to be obvious, but it is already an important and established fact of life in many policy areas (O'Toole & Hanf, 2002). Bodies such as the International Civil Aviation Organization and, most famous, the World Trade Organization make rules with serious ramifications for domestic governments. In many cases, these rules can conflict with domestic statutes and regulations, requiring adaptation on the part of government agencies and firms. And contrary to the view that domestic governments can be unbending in the face of international norms, this accommodation of international rules occurs regularly (Chayes & Chayes, 1991).

Participation in the deliberations of international bodies is now a commonplace responsibility of domestic government bureaucrats. Agencies routinely devote staff to international issues and participate in global and regional transnational organizations. For example, in the United States, the Nuclear Regulatory Commission (2004) has an international office. More important, its regulations make frequent reference to the International Atomic Energy Agency (IAEA) regulations and the requirement that US entities comply with IAEA standards and make themselves open to IAEA inspections. This type of recognition of the primacy of international regulations is far from universal, but the practices of many government bureaucracies reflect international mandates from entities such as the World Customs Union and the Convention on the Trade in International and Endangered Species.

The Logic of Global Governance

These observations regarding the history and organization of global governance reveal something quite different from the domestic model starting with the reasons that global governance organizations emerge (and persist). What we observe is a conditional need governance grounded in a very different premise than the social contract of John Locke or his peers. Unlike Thomas Hobbes's citizens for whom life was nasty, brutish, and short in the absence of Leviathan, the countries and corporations that create international organizations do not fear for their lives or property. Rather, they recognize that their wealth might be increased, their safety enhanced, or their activities simplified with a set of globally recognized rules. Imagine mailing a letter from one country to another without the harmonization offered by the Universal Postal Union or the chaos introduced into air travel in the absence of a set of agreed-on principles of communication and navigation.

Participation in global governance regimes is ultimately about the self-interest of actors being served through a coherent set of rules. But unlike the states that Locke, Hobbes, and other early political philosophers sought to explain, contemporary global rule-making bodies lack the coercive authority to impose their rule regardless of their underlying utility. That is, they do not have the ability to manipulate the self-interest of their would-be followers by threatening jail, fine, or, for that matter, beheading. And so participation in global governance represents a choice for actors that is guided by a fundamentally different logic from that with which standard public administration scholarship is concerned. Participation in a transnational regime is driven by the interests of the parties that are to be bound by rule-making organization's outputs.

Global rules are desirable when the cost associated with their creation and implementation is outweighed by gains afforded by the resulting coordination or harmonization. We see this in a host of areas, including telecommunications, travel, and finance. But there are other arenas (e.g., carbon emission or climate change more generally) where we have not yet seen robust global regimes because key actors have felt their interests are better served by the absence of a global regime than any possible organization that could arise (Biermann et al., 2009).

Therefore, global governance does not happen in situations where the self-interest of all or some actors is best served by a status quo that does not include a global set of rules or standards. Consider the lack of a standard charging cable for electronic devices. Electronics manufacturers have clearly concluded that the benefits of maintaining switching costs for their customers as well as the markets for incompatible accessories outweigh the benefits (to consumers) of standardized hardware. This is obviously not true in the storage arena, where most hardware and software is compatible across brands and, to some extent, platforms.

Understanding the logic of rule acceptance is a vital issue for scholars and practitioners alike. Global governance organizations matter because the rules they produce are accepted. Many attempts at global governance that do not gain acceptance invite obvious questions: Why are some rule-making bodies accepted but not others? Why are the rules they generate widely used? Again, the normative theory underpinning most public administration scholarship roots power in legitimacy: rules are followed because processes were followed ensuring fairness and impartiality, two core dimensions of democratic legitimacy (Sell, 2014).

In the domestic context, we rarely have an opportunity to see whether rules are followed in the absence of this type of legitimacy. And there is reason to suspect that legitimacy is not the only explanation for obedience. There are myriad examples of rule following in countries that do not meet our normative expectations for legitimacy. Moreover, as individuals, our acceptance of rules (say, obeying the speed limit) is attributable only in part to legitimacy. Fear of sanction is at least as important. Our acceptance of the legitimacy of the ticketing agency and the legislative process that created the speed limit are of secondary concern (at best).

This interest-based consideration in rule acceptance tends to be minimized in our understanding of governance. In the domestic context, this is not particularly troublesome because those of us fortunate enough to live in democratic environments see the various explanations for obedience in alignment. Government makes rules in a fair way and we do not want to go to jail or pay a fine; there is no tension.

The global governance context is quite different: global rule-making bodies generally have no formal sanctioning power to compel obedience. Those who do not like the rules can simply walk away. That creates a fundamentally different dynamic. Consider the Basel Committee on Banking Supervision (BCBS), a critical entity in global financial regulation responsible for creating many rules governing banking. A country disliking the regulations produced in the wake of the 2008 global financial crisis could opt not to adopt them. There is no BCBS police equipped with black helicopters to arrest leaders for this act of deviance or an international body to impose sanctions. That is not to say there would be no consequences. Indeed, that country's bank would be financially cut off from the rest of world. but that is a different type of consequence. Unlike an individual driver facing a legal sanction, an actor is free to make a calculation regarding the rule with no hierarchically imposed discipline.

And therefore interest-based reasons for rule acceptance are effectively disentangled from normative explanations (i.e., legitimacy). In global governance, the potential for conflict between the two is ever present. Indeed, the institutional forms of global rule-making bodies can be best understood by seeing them as design solutions to the underlying tension between normative and interest-based considerations.

Learning from the Design of Existing Transnational Organizations

In World Rule, (Koppell, 2010a), I integrated several approaches commonly used to understand institutional forms in public administration and other fields: (1) the structure of global rule-making organizations, particularly their approaches to representation and administration; (2) their rule-making process; (3) their adherence mechanisms or tools by which rule adoption and implementation are encouraged; and (4) the nature of interest group participation. This empirical study of twenty-five global rule-making organizations involved quantitative analysis complemented by intense interviewing and gathering of qualitative data. Capturing the informal is as important as the formal; how things work in practice is not always represented by the numbers, and the differences are often profoundly important.

Ultimately patterns in the distribution of characteristics revealed which organizational attributes tend to go together, and based on these clustering tendencies, I suggested three types of global governance organizations:

• Classical—the traditional intergovernmental body with a design that emphasizes legitimacy. It jibes with normative expectations imported from the domestic context and puts high value on nation-states. Safeguards are built into this model to protect powerful members of the organization from unwanted outcomes. These safety valves are not available to all organizational members, and while they do not guarantee preferred outcomes, they do generally ensure that unwanted outcomes can be avoided.
• Cartel—essentially the opposite of classical. Cartel organizations (e.g., the Basel Committee) offer very low levels of access and are the most contrary to normative expectations such as transparency and equity in participation. Yet they create some of the most accepted rules in the world. (This observation feeds one of the most provocative conclusions of this study: that normative legitimacy is overrated.)
• Symbiotic—nongovernmental or quasigovernmental organizations that generally reach into markets. They typically put rule-writing responsibilities into the hands of the users of the rules, a very different notion of governance from what we import from the domestic sector.

I offer a few bureaucratic structures associated with these models to make the case for the value of this public administration approach to the study of global governance. The design features that appear to be critical are representational structure, voting or decision making, safety valves, and rule type. Other studies of global organizations that look at different functions naturally highlight other administrative design features. Steven Waddell's (2012) analysis of global action networks, for example, focuses on the design of network participation. Jarle Trondal (2013) makes an important contribution in his work on the relationship between administrative behavior and bureaucratic structure, identifying the logics that mediate between them. Underscoring not only the growing interest in the study of transnational organizations but the significant accumulation of knowledge that has occurred in the past decade, two important edited volumes on international organizations have been published recently (Reinalda, 2013; Weiss & Wilkinson, 2014).

In this case, the analysis of representation identified two general design approaches. More familiar is the model built around a representative body that chooses a smaller intermediate body with day-to-day governing responsibility. This intermediate body is often called a council and is therefore dubbed the conciliar approach. The intermediate body oversees some permanent bureaucracy (often called a secretariat). Alternatively, some organizations are more bottom up. Constituent groups elect representatives to a board that oversees the secretariat. Governmental organizations typically adopt the conciliar approach consistent with strong normative expectations for governmental entities and the need to respect claims of sovereignty (through national representation).²

Apportionment of voting strength defies expectation. Most international organizations do not use weighted voting schemes (exceptions are the World Bank and International Monetary Fund) and instead use one member, one vote. One might think that this system puts the United States, Japan, or other stronger countries at risk.³ Here is where the public administration perspective adds value: we know that administrative structures must be understood as systems rather than individual features.

Alternative approaches to representation and apportionment incorporate distinctive protections against unwanted outcomes in different ways. These might be termed safety valves. The UN Security Council veto represents an obvious safety valve in the United Nations. Among the GGOs examined in World Rule (Koppell, 2010a), however, no organization employs the “security council” approach; the safety valves were more subtle and dependent on the contextual variables and the combinations of structural features. One member, one vote apportionment, for example, is strongly correlated with the conciliar approach to representation. Every organization member participates in the representative body, but this assembly typically meets once a year at most—sometimes once every two or even four years. In conciliar organizations, real decision-making authority is vested in the intermediate body, and almost every organization that employs the model guarantees intermediate body membership. Membership is typically guaranteed to the most powerful parties—those who have to be assured that their interests are protected before they will join.⁴

Layering additional considerations helps explain variation. Open membership organizations are essentially available to any country or organization. United Nations–related organizations are typically open in this sense. A closed membership organization is different; members retain control over admission. The Basel Committee, for instance, approves new members selectively. This in itself is a powerful safety valve; closed membership organizations do not need the “intermediate-body” safety valve because they exercise control at the front door. Such an institutional design serves the same end in a different way. All this comes out when you look at the patterns across organizations; closed membership organizations do not have distribution requirements in intermediate body membership.

By incorporating multiple facets of variation in global governance, understanding of the institutional forms is deepened. For instance, studies of rule-making agencies do not typically differentiate the types of rules being crafted. In the realm of global rule making, however, variation in the nature of the rule appears quite important in explaining variation in institutional form. All rules accomplish one of two types of coordination: pure coordination or battle-of-the-sexes coordination. Under pure coordination, the substance of the rule is not terribly important; agreement on a standard is critical. The classic example is what side of the street we drive on. But most coordination is what is typically termed battle-of-the-sexes coordination. This name is derived from the anachronistic metaphor typically offered to explain the concept: a husband and wife want to go out together, but the husband wants to go to boxing and the wife prefers ballet. They want to do something together, but they also want different activities. If they are committed to coordinating—that is, if they prefer either activity together to their preferred activity alone—they will cooperate but still try hard to get their preferred outcome (Koppell, 2010a).

Most global rule-making exercises are best described as battle-of-the-sexes type of coordination where the problem is coming to agreement. However, the more technical the subject matter an organization deals with, the more it looks like pure coordination. Very little rule making is actually pure coordination. There are always interests at play. But the less divergence of interests there is, the less important this design feature is in the construction of a GGO. The essential point is that this helps explain why institutional forms are linked to context.

This analytical approach may also be taken with respect to rule making, adherence, and interest group participation. In each area, the general theory of institutional design is borne out. So, for example, in the area of rule-making process, observations with respect to the formality of the process speak to the central theoretical claims regarding institutional design in global governance. The formality of the rule-making process refers to the rigidity of the steps taken for the creation and introduction of a new rule. Formal processes do not allow much variation creating a highly predictable, often legalistic approach. In contrast, a more informal rule-making process is exemplified by the International Accounting Standards Board, which offers greater latitude. To illustrate, its requirements state that there “could be a discussion paper but it's not mandatory.” This is not to suggest that rule makers have carte blanche but they have leeway to make accommodations. Informal rule-making processes are much more likely to be employed by closed membership organizations. This makes sense. An informal process can be very hard to predict and control, and so it is acceptable only in a context where trust in other members is very high. In organizations that are formal in approach, there are sometimes informal settings, restricted to a subset of members, where informal practice is accepted.