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Taking a Look at The Interplay of Public and Private Standards

8/17/2012

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I would like to share a bit from the Interplay of Public and Private Standards: Literature Review Series on the Impacts of Private Standards, Part III, the third of a four-part series commissioned by the International Trade Centre that looks at the impacts of and conditions under which voluntary standards operate. My other blogs on the first two reports – Impacts of voluntary standards on producers and Impacts of voluntary standards on value chains provide a similar summary of the first two reports in the series. This third report is important because the use of voluntary standards continues to be on the rise and governments often play an important in their success or demise. With one third of global trade goods already affected by standards, voluntary standards may become increasingly important to exporters, especially when you consider that “the boost in trade from the complete international harmonization of product standards would be equivalent to the reduction of tariffs by several percentage points.”[1]

While the report states that the interplay between public and private food safety and quality standards have been developed and researched more extensively than other industries, many of the report findings are equally relevant to social and environmental standards for non-food crops and products such as cotton or biofuels.

I’d like to take a moment to discuss the legitimacy of standards, an important topic of the paper. The legitimacy of private standards can spark debate – starting with the definition of “legitimacy” for standards. With this said, most acknowledge that the standards’ legitimacy centers on three concepts: transparency, inclusiveness and accountability. These concepts should be applied to the three stages of standards development and implementation: 1) standards setting, 2) implementation and certification process, and 3) monitoring and evaluation impacts of the standards.

A standard’s legitimacy begins with the standards setting process (sometimes called “input legitimacy”) – was this process transparent, was it inclusive of all stakeholders, and was it based on science? The legitimacy of a standard is also influenced by its implementation, taking into account factors such as the transparency and credibility of audits, etc. (sometimes called “output legitimacy”). Another factor to consider with a standard’s legitimacy is actual impact, including environmental impacts and the potential market benefit to the producer.

Legitimacy of private standards is particularly critical when private standards replace public standards and assume regulatory functions. The legitimacy of a standard can be heightened by the government’s actions to support that standard. Governments can support private standards in the following ways:

·       Raising awareness among producers
·       Facilitating national stakeholder dialogue
·       Supporting or providing training activities
·       Assuring control
·       Providing infrastructure facilitating and measuring compliance
·       Disseminating information

Standards that are supported by governments will likely enjoy a higher level of legitimacy, which could be heightened if the government becomes certified against a standard, requires certification of imported or purchased products, and incorporates the standard into statutes, regulations, permits and international agreements.

Conversely, if policymakers do not consider a standard to be legitimate, their lack of support will likely erode the legitimacy of the standard among their constituents.

I applaud this report because I feel it is importance of government involvement in the development and implementation of standards is not simply limited to the legitimacy of standards but also for their long-term sustainability by providing necessary resources and policy incentives that otherwise would not be available.

[1] Büthe, T and Walter, M. The New Global Rulers: The Privatization of Regulations in the World Economy. Princeton, N.J.: Princeton University Press, 2011.

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