The Multiplication Of Cross-Border Governance Mechanisms: Implications For Democracy And Global Order

Saskia Sassen
Ralph Lewis Professor of Sociology
University of Chicago
December 2001

Major transformations since the 1980s have contributed to a proliferation of partial, often highly specialized, mechanisms for the cross-border governance of a growing number of processes and institutions. There is considerable heterogeneity in the key institutional features of these mechanisms, their level of formalization and transparency, the extent of their incorporation into national legal systems, and the extent to which they operate in the public domain or are private self-regulatory initiatives. There is also considerable variation in how these mechanisms for governance relate or interact with national law and with international treaty law and custom.

All together this produces an enormously complex and dynamic context for the larger question of global governance. The particular concern guiding our project consists of two distinct matters:

• First, what is the emergent structure of global governance resulting from this multiplicity of partial, often highly specialized mechanisms?

• Second, on a more heuristic and methodological level, what do the events of September 11 and its aftermath make legible in terms of the strengths and the deficiencies of this emergent structure for global governance.

There is a rapidly growing scholarly and research literature that covers particular governance mechanisms and has contributed an enormous amount of knowledge to the subject. What is lacking is a well-developed analysis of

• how these various mechanisms cohere or not,
• whether they constitute emergent regimes,
• what are the tensions and synergies among them, whether they are mutually supportive or not,
• what is left out of the picture, and
• what remains unrecognized and unnamed.

In the first phase of this project, currently underway, we are beginning to map these issues in order to develop a larger and long-term project with a highly developed focus and methodology. At this stage, we are developing coordinated overviews of the field of global governance as constituted through the multiple specialized mechanisms and self-coordinated initiatives that have been developed and operate today. In part, this entails a preliminary and somewhat schematic mapping of these multiple governance mechanisms and activities. Also entailed is a preliminary exploration of what is falling between the cracks, with special attention to what September 11 and its aftermath have made clear about our existing apparatus for global governance. Of particular concern are the implications for democratic participation and public accountability of global governance systems, on the one hand, and their positivie and/or negative impacts on national democratic and accountability mechanisms, on the other.

BACKGROUND.

The emergent global governance structure includes a variety of components: highly specialized mechanisms, older forms of treaty and customary law, new soft governance systems, informal initiatives and networks aimed at self-regulation or promotion of specific causes. We will refer to this variety of forms as governance mechanisms for shorthand. A full inventory of all these components would, probably, be quite impossible given the multiplication of initiatives at all levels. The critical issue for our purposes is a mapping of the variety of mechanisms in order to understand their heterogeneity and possible tensions or synergies among these various mechanisms. We classify the types of governance mechanisms we will focus on as follows:

1. Mechanisms for cross-border governance which are specific, specialized and formalized. Prominent among these are mechanisms that cover multiple aspects of global trade (e.g. the manufacturing standards contained in the International Standards Organization), global capital markets (e.g. accounting and financial reporting standards contained in the International Accounting Standards Board), monetary policy issues covered by the International Bank of Settlements, the cross-border circulation of professional workers contained in all the major trade agreements (notably NAFTA and the GATTS), the global art market (e.g. insurance standards), refugee flows (e.g. the standards contained in the UN Convention on Refugees), and many others.
2. Broader formal systems that require often complex insertions in national legal systems and/or existing international law and agreements. Among these are the relation between national law and World Trade Organization efforts to eliminate trade restrictions, timetables for the attainment of environmental goals, the enabling legislation for human rights/universal jurisdiction. The European Union represents, clearly, an enormously complex effort to establish cross-border governance systems. To what extent we will use it as both a concrete instance of such systems and one that illuminates the possibilities and constraints will be established during the planning stage. Given the level of complexity and formalization it would require experts on various aspects of the European Union to become part of the effort.
3. Informal systems or private systems, both of which fall outside inter-governmental frameworks. Insofar as globalization and its constitutive policies have reduced the formal authority of national states and their exclusivity in the domain of cross-border relations, other types of actors and issues have had a chance to emerge. Some of these informal cross-border governance mechanisms may become formalized and incorporated into broader systems while others may remain informal; and some of these private mechanisms may become part of the public domain. Here we include a variety of cross-border activist networks concerning the environment, human rights, immigrants, refugees, women, child labor, illegally trafficked women for the sex industries, fair trade, anti-WTO struggles, civic groups working for better conditions in border regions, alternative media, sweatshops, and many others. We also include a series of private self-regulatory mechanisms developed by corporations to handle a growing range of issues formerly in the domain of state authority: international commercial arbitration as the main way of handling cross-border business disputes, self-regulation in economic sectors dominated by a limited number of large corporations, voluntary instituting of labor standards and human rights codes in a growing number of large visible multinational corporations, and others.

Considerable research and analysis of these governance mechanisms has been produced over the last decade. We identify two major trends in this research literature and, on that ground, identify what is missing and provides the rationale for our project. On the one hand, there is a vast amount of empirical information on each of these three types of governance mechanisms. Much of this information is highly specialized and hence has as its central and typically unique focus the characteristics of single mechanisms. As a result we have multiple research literatures which tend to be part of different academic disciplines and methodologies. The scholars and researchers involved tend to have few occasions to interact in substantive ways that could advance a more synthetic account of how these various governance mechanisms interact with each other and the type of governance architecture they are shaping. The central contribution of these bodies of research is their detailed data on specific governance mechanisms.

On the other hand, there is a very general overview literature on global governance which is characterized by normative efforts and tends to be conceptual with few if any empirical specifications. Precisely because it seeks to address the broader subject of global governance, this literature has positioned itself at a sufficiently general level to avoid the particularisms of each governance domain. The central contribution of this literature is its articulation of general propositions about various features of a putative global governance system.

Our proposed study will make use and indeed benefit enormously from the existence of these two bodies of research and scholarship. What is missing or remains undeveloped is an empirically grounded, normatively informed analysis of the emergent architecture for global governance constituted via these specific mechanisms, and what matters are excluded from this emergent architecture or are not given legitimate status. This is the subject we will begin to work on through this planning grant and then continue in the larger better defined project we will develop based on the results of the planning grant.

A key assumption in our project is that there are possibilities for global governance, but that they are not necessarily the same as those contained in national systems, and hence need specification, and, secondly, that existing mechanisms are not necessarily sufficient to ensure democratic participation and public accountability. This in turn raises the possibility that national criteria and institutions for legitimating and recognizing the normative value of a given mechanism (e.g. in terms of democratic participation and public accountability) may well be insufficient.

The existence itself of cross-border governance mechanisms, both formalized and not, and their proliferation signals that national systems are insufficient, that something has changed, and that what used to be confined to national democratic systems is no longer thus confined. We need to understand how these criteria can be worked into the emergent global governance architecture. We also need to understand the extent to which this emergent architecture cannot accommodate such criteria. Which existing systems and dominant trends in the development of cross-border governance mechanisms are strengthening democratic participation and public accountability, or at least enabling these, and which are having the opposite effect? A critical issue for our project will be to understand the nature and direction of the interactions of different types of governance mechanisms and the possibility that this produces new types of asymmetries with distinct consequences.

This effort will be aided by the existing research on the scope, efficiency, and features of many of these governance mechanisms. But we cannot do this simply by reviewing each mechanism on its own terms. We also need to get a hold of the whole, the interactions and tensions among different mechanisms, and how these interact with existing national systems (many of which will continue to exist for the foreseeable future).

Getting a handle on this emergent global governance structure will require more than an analysis of established mechanisms such as those listed in the preceding section. It will also require understanding more elusive, often hidden or unrecognized, elements that are de-facto producing governance dynamics or are undermining these. Among the features we want to specify empirically in this regard are the following:

• First, there is a growing range of objective conditions that are de-facto transboundary conditions, some recognized and some not. Some of these are minor and probably do not warrant much governing. Some of them are serious and demand our attention. Among the most extreme, and probably somewhat rare, are those brought to the fore by the events of September 11: the use of the global financial system and of the global system for the circulation of people by organized terrorism for purposes falling outside the confines of those systems.

• Second, there is an emergent systemic condition that enables and pushes states to collaborate in multilateral engagements that is not quite fully captured in formal treaty law. Again, the events of September 11 and the subsequent decisions to launch an international police effort and an international military action made evident a far stronger disposition towards multilateral action than one could have inferred from formal agreements. It is uncertain that invokation of the by now famous Nato clause holding that the attack on one member state calls all members into action would by itself have sufficed to get this alliance going. Rather, it would seem that there are (new) embedded factors promoting new types of multilateral collaboration even as unilateral sovereign authority remains the key feature of the inter-state system; these embedded factors may not be as fully recognized, named and formalized as they could be.

• Third, considerable resources, both private and public have gone into the development of some of these mechanisms for governance (e.g. those linked to the functioning of the global capital market) and few if any have gone into the development of others (e.g. multilateral approaches to the regulation of cross-border migrations). Beyond the possible inequities involved in this uneven distribution of resources, there is the far thornier fact that this asymetry itself will tend to reproduce the legitimacy of certain types of claims (e.g. claims for the existence of global capital market) and the lesser, or lack of, legitimacy of others (e.g. the claims for international labor and wage standards to avoid a race to the bottom). This asymmetry may carry serious consequences precisely because these are highly dynamic processes and because increasingly unilateral state action will be inadequate for the resolution of various issues.

The Global Governance Project is currently producing an inventory of the existing mechanisms for cross-border governance developed with the onset of globalization in the 1980s, with special attention to what the events of September 11 have made visible in terms of cross-border governance and its strengths and failures. Clearly, many of these issues are also the domain of national governance mechanisms, and making these distinctions is not always easy or self-evident, especially in cases where the boundaries are shifting or unstable given ongoing economic and political globalization. Based on our conceptual mapping of the emergent global governance structure and our exploration of possible collaborative efforts, we will establish a set of questions for further research and a deeper analysis of the emergent global governance structure than the initial conceptual mapping described here.