Transnational institution building as public-private interaction: the case of standard setting on the Internet and in corporate financial reporting

This article sets out to compare processes of formal institution building in two transnational policy areas, the regulation of the Internet infrastructure and the regulation of corporate financial reporting. Both cases are concerned with regulatory arrangements beyond the nation state, in which standards are sought to reduce the uncertainty that actors face when interacting at the transnational level. The article focuses on changing actor constellations, arguing in favour of dynamic conceptions of transnational regulation and rule-making. Both cases demonstrate that the creation of regulatory institutions such as standards, codes or contracts is a dynamic and interactive process that involves both public and private actors. Based on a comparison of the regulatory arrangements we specify various phases of transnational institution-building and we suggest three mechanisms that help explain the observed institutional changes. Both cases illustrate that transnational regulatory institutions do not only reduce uncertainty, they also contribute to the creation of new forms of uncertainty.