A New Approach to More Effective Regulation?
4th Symposium on Regulatory Reform, Institute of
International Parliamentary Affairs.
Dr. Bettina Lange, Centre for Socio-Legal Studies, Oxford
University
Argument of the Presentation I
 Understanding how society – a ‘social sphere’ – shapes
regulation is key to thinking about innovative and
effective approaches to regulating business actors
- civil society actors (NGOs, citizens and economic
actors themselves)
- ‘social norms’: normative and cognitive
frameworks shaping how regulators and regulated
 think and act
Argument of the Presentation II
 Legal regulation is more likely to be effective if it is
grounded in the values of society, rather than just one
segment of it, in particular the rationalities of markets.
Citizens as key stakeholders in regulation, can be strategic
champions of such values.

- a different methodological perspective:
economic sociology
- embedding economic transactions into social
relationships as one approach towards regulating them
Structure of the Presentation
 1. Karl Polanyi’s key economic sociology ideas
2. Contemporary debates about ‘responsive
regulation’
 3. A case study: European Union regulation of
trade in transgenic agricultural products
4. Some critical reflections upon ‘effective’
regulation
1. Karl Polanyi’s economic
sociology
 The myth of self-regulatory markets and the rise of the
‘market society’
 ‘Disembedding economic relationships out of social
ones’ – ‘The Great Transformation’ (1944)
 The ‘primacy of society’ – all economies are
embedded in social relationships
1. Karl Polanyi’s economic
sociology
 The rise of the regulatory counter-movement
 Civil society actors are key: ‘regulating through a social
sphere’
 Polanyi’s wide regulation concept:
a) regulation can reign in negative side-effects of
economic activity
b) regulation can be constitutive of economic activity
c) social norms can regulate economic activity: trust,
reputation,
d) state regulation, interaction with social norms
1. Karl Polanyi’s contribution to developing
‘regulating through a social sphere’
 A different perspective for understanding what drives
economic actors:
 the significance of values, not just interests
 questioning a clear demarcation between economic
and social drivers of behaviour
 developing social norms within the corporation as a
regulatory force: The US Commission Report on the
Deepwater Horizon disaster
2. Responsive Regulation Debates
 Ayres and Braithwaite (1992): ‘Responsive Regulation:
Transcending the De-Regulation Debate’:
 Regulators becoming responsive to the attitudes and
behaviours of regulated businesses
 harnessing the self-regulatory capacity of economic
actors in the shadow of formal state law and in the
shadow of community expectations
2. Responsive Regulation Debates
2. Responsive Regulation Debates
 the option of ‘the big stick’ of serious sanctions
enables the regulator in a majority of cases to carry out
its work by ‘speaking softly’ - efficient use of
resources by the regulator
 ‘regulating through a social sphere’: at what level in the
enforcement pyramid a regulator will locate its
enforcement approach will be up to negotiation by a
tripartite regulatory community
2. ‘Really Responsive’ Regulation
 regulators becoming responsive to the operating and
cognitive frameworks of the regulated firm.
 taking into account ‘the institutional environment of
both regulated and regulators’
 Regulators taking into account the ‘different logics of
regulatory tools and strategies’
Applying this across 5 steps of an enforcement process
3. EU Regulation of Trade in
Transgenic Agricultural Products
 Developing the idea of ‘regulating through a social
sphere’

communication between participants in regulatory
regimes key to ‘regulating through a social sphere’
- the limited role of public participation in European
Union (EU) authorisations for transgenic agricultural
 products
- the role of emotions in this regulatory regime
3. EU Regulation of Trade in Transgenic
Agricultural Products
 Key elements of the regulatory regime:
Directive 2001/18/EC and Regulation 1829/2003/EC
 Requirement for prior administrative authorisation for
transgenic agricultural products: risk assessment
 Key actors: Directorate General Health and
Consumer Affairs, EU committees: representatives of
Member States, the European Food Safety Authority
3. EU Regulation of Transgenic
Agricultural Products
 Limited public participation:
- narrow legal provisions:
preamble 46 Directive 2001/18/EC
Art. 7 of Regulation 1829/2003/EC
limited scope of national public participation
provisions
- limited communication in practice:
stock responses
3. EU Regulation of transgenic
agricultural products
 The invocation and management of emotion
discourses:
trust in regulatory science, procedures and
‘experts’
institutionalizing consumer distrust in order to build
trust into regulatory actors in food regulation regime
rational distrust as a key element of political
accountability in a participatory democracy
4. Some queries about ‘effective’
regulation
 What is the benchmark?
 Effective in terms of achieving the objectives of legal
regulation, as spelt out in statutes and interpreted
through cases?
- but limits of clarity and determinacy of legal rules
What should be the benchmark?
- responsive regulation is often associated with ‘going
beyond compliance’ or ‘moving towards compliance’
The limits of steering regulatory effects: unintended side effects, paradoxical effects of regulation
Conclusion I
 ‘Regulating through a social sphere’
not a new approach –
grounded in classical economic sociology – but developed
in contemporary, cutting edge debates about ‘responsive’
regulation.
 Civil society (citizens and economic actors) actors key to
legal regulation – attitudes and behaviours of the
regulated matter, tripartite approach: enforcement
pyramids
 Increasing significance , also in light of the declining role
of the nation state in regulating transnational risks
Conclusion II
 Communication is key in responsive regulation
approaches
 Invocation and management of emotion discourses as
a key challenge for ‘regulating through a social sphere’:
balancing trust and distrust