Understanding the New Regulatory Governance: Business Perspectives

Abstract

This article considers business understandings of two of the principal features of the new regulatory governance. First, it focus on attempts to place greater responsibility for risk regulation on business and asks how well equipped they are to manage this. Second, it examines the decentering of the state and considers how business organizations view the influence of nonstate actors on their business regulation. These issues are discussed with reference to data from two different research projects in the United Kingdom. The findings question the implicit assumptions the new regulatory governance makes about how well equipped businesses are to manage the risks they generate and how able nonstate influences are to influence the full range of businesses.l apo_346 459..476

Organizing Risk: Discourse, Power, and “Riskification”

“…This "mathematizing" of risk (MacKenzie, 2005) dominates the finance and insurance industries, where risk is measured with a view to maximizing gains through the myriad of financial risk management techniques that have grown out of the Black-Scholes-Merton model (Millo & MacKenzie, 2009). A similar approach underpins the regulatory governance of other hazard-producing industries, such as nuclear power, mining, and transportation, where government agencies stipulate standards to which organizations should conform, based on measurement, specification, and auditing (Hutter, 2011), by drawing on technical risk-based tools developed from economics and the natural sciences (Lloyd-Bostock & Hutter, 2008). Normal science and the scientific method are used by government agencies, such as the US Environmental Protection Agency and the European Chemicals Agency, to assess whether chemicals are likely to damage human health or the environment in unacceptable ways, and to regulate the firms that produce and use these chemicals accordingly.…”

Transcending the deregulation debate? Regulation, risk, and the enforcement of health and safety law in theUK

“…As then Chancellor of the Exchequer, Gordon Brown, now infamously stated when announcing the Hampton Review, the policy trajectory was towards “a new, risk‐based approach to regulation to break down barriers holding enterprise back;” the “new” model will entail “no unjustifiable inspection, form‐filling or requirement for information … Instead of routine regulation trying to cover all, the risk based approach targets the necessary few.” This new approach will “help move us a million miles away from the old belief that business, unregulated, will invariably act irresponsibly” (Brown ). In short, “the Hampton review … placed risk‐based regulation at the center of its recommendations for improving regulatory inspection and enforcement … this manifests the new regulatory governance with its emphasis on the responsibility of the business organization and light touch regulation for the responsible organization” (Hutter , p. 463).…”

Is New Governance the Silver Bullet? Insights from the Australian Buildings Sector

“…Then, the ability of businesses to manage the environmental risks they create may be overstated. Theoretically, self-regulation, or selfmanagement, may be expected to result in innovative risk-reduction solutions; however, the empirical evidence shows that businesses have difficulty in dealing with the freedom provided (Hutter, 2011). Finally, in practice new governance arrangements appear to be based on ideological preferences (i.e.…”

“…A particular new governance arrangement may be a success in one context but not in another, or it may be a success for a certain set of actors in a context but not for other actors in that context (e.g. Holley & Gunningham, 2011;Hutter, 2011). Further, as empirical research often fails to support the theoretical claims made (Delmas & Young, 2009;Gunningham, 2009aGunningham, , 2009bDe Burca, 2010;Holley & Gunningham, 2011), new governance theories may, like the practice, be criticised for being merely normative (Backstrand et al, 2010;Hoffmann, 2011).…”