Voluntary Standard Setting: Drivers and Consequences

This essay is about the drivers and consequences of changes in the voluntary consensus standard-setting (VCSS) system, the part of the contemporary global governance system that most of us encounter the most frequently, but that we rarely even notice. The VCSS system is made up of thousands of “technical committees” in which hundreds of thousands of experts (most of them engineers) create standards that constantly affect our lives—from the unique number that identifies this journal, to the electronic codes that translated my keystrokes into the words you are reading at the moment, to the rules governing the supply chain for the “fair trade” coffee you may have in a mug by your side. Historian Mark Mazower calls the International Organization for Standardization (ISO), the organization that stands at the apex of the largest network of groups that sponsor these technical committees, "perhaps the most influential private organization in the contemporary world, with a vast and largely invisible influence over most aspects of how we live, from the shape of our household appliances to the colors and smells that surround us."

There are a few other powerful VCSS bodies in addition to the ISO, among which are the OpenStand alliance of private bodies that help govern the Internet and the ISEAL alliance of organizations that set and monitor standards for socially responsible products. In addition, there is an ever-changing ecology of hundreds of often short-lived “consortia” in which small groups of companies create voluntary technical standards that temporarily guide development in rapidly changing fields, especially information technology. All of these bodies form technical committees to create specific standards. Except in the case of the consortia, these committees always include representatives of companies that produce the product in question, representatives of the companies or organizations that are the major purchasers of the product, and experts that the sponsoring organization chooses to represent the general interest—often engineers who teach at universities. The goal of every committee is to reach consensus on standards that will be published and made available for any company or other organization to adopt voluntarily. While the consortia are less concerned with the balanced representation of all stakeholders, the ISO, OpenStand, and ISEAL networks are committed to establishing voluntary standards through the consensus of expert representatives of all relevant stakeholders—that is, everyone who will be affected by the proposed standard.

While the standards created in this way are designed to be taken up voluntarily, many of the nonconsortium standards quickly become all-but-authoritative because they are convenient for all governments to adopt when contracting for private goods and services, and because firms often adopt the standards preferred by their largest customer. Moreover, many democratic governments tend to see the balanced voluntary consensus process as a legitimate way to set standards, perhaps just as legitimate as the democratic legislative process itself. Finally, the General Agreement on Tariffs and Trade (GATT) and its successor, the World Trade Organization (WTO), have considered international VCSS standards that were set by all stakeholders as neither barriers to trade nor something that confers an unfair advantage on those who adopt them. This WTO status further encourages firms and governments to use such standards in place of standards developed through any other process.

For more than a century, the legitimacy and effectiveness of the ISO, OpenStand, and ISEAL form of VCSS has led some politicians and theorists to see the process as a possible supplement or replacement for the traditional intergovernmental processes of global governance. Recently, this view was championed by a World Bank vice president, Jean-François Rischard, in a 2002 book with the alarming title of High Noon: Twenty Global Problems, Twenty Years to Solve Them. Later, after the global financial crisis, the World Economic Forum’s “Global Redesign Initiative” was also filled with proposals for world government through voluntary standards created by expert representatives of various stakeholders.

As we will see in a later section, such advocates may overstate the promise of VCSS. But first it is worthwhile to consider why this process is so highly regarded. It has had a major impact on the world and it is likely to continue to do so. Industrial standardization has led to the more rapid development of industrial economies than would have been possible if the world had had to rely on markets and governments alone. Even more significantly, VCSS has played an important role in building global markets. Moreover, the men and women involved in voluntary standard setting have often had higher ambitions, expecting the VCSS process not only to strengthen industrial capitalism but also to solve many of its attendant problems: inequality, economic crises, and even war between rival industrial powers.

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