International Standards Project

Profs. Tim Büthe & Walter Mattli
            (Duke University & Oxford University)

Welcome to the homepage of the International Standards Project, founded in 2001 and led by Prof. Tim Büthe (Duke University, USA) and Prof. Walter Mattli (Oxford University, UK).  The project seeks to raise awareness--especially among social scientists, legal scholars and practitioners, and policymakers--of the crucial role that technical and often non-governmental rules play in the governance of global product and financial markets.  The project aims in particular to advance our understanding of the processes of setting such standards through carefully designed, innovative social scientific studies.

Two multi-country, multi-industry business surveys have been key elements of this research, including:

  • the first systematic, social-scientific survey among more than 700 publicly listed companies about the International Financial Reporting Standards (IFRS) developed by the London-based International Accounting Standards Board (IASB), as well as
  • a comprehensive survey of more than 1300 firms in 5 industries about the product standards of the International Organization for Standardization (ISO) and its electrotechnical counterpart, the International Electrotechnical Commission (IEC).

Our book, just released by Princeton University Press, combines systematic analyses of these major surveys with key insights from more than two hundred interviews, evidence from historical research, and a wealth of illustrative examples to provide a new understanding of the standard-setting process in these international non-governmental organizations, based on a novel analytical framework for understanding public and private regulation of the world economy.  The books presents the findings from this rigorous scientific research in a style that makes them accessible to a broad readership, including practitioners in public policy, business/finance, law, and engineering.

For details and to order the book from Princeton University Press, please click on the title below.
For additional information and to provide feedback as part of an open discussion of the book, see

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Tim Büthe and Walter Mattli,
The New Global Rulers:
The Privatization of Regulation in the World Economy.

Princeton, NJ:  Princeton University Press, 2011.
  (Click here for an Executive Summary)
You can download the introductory chapter by clicking on the title of chapter 1 below.
For discussion and additional information, see our facebook page:


Chapter   Page
1 The Rise of Private Regulation in the World Economy 1   
2 Private Non-Market Rule-Making In Context:  A Typology of Global Regulation 18   
3 Institutional Complementarity Theory 42   
Private Regulators in Global Financial Markets:
Institutional Structure and Complementarity in Accounting Regulation
5 The Politics of Setting Standards for Financial Reporting 99   
Private Regulators in Global Product Markets:
Institutional Structure and Complementarity in Product Regulation
7 The Politics of Nuts and Bolts – and Nanotechnology:
ISO and IEC Standard-Setting for Global Product Markets
Contributions to Theoretical Debates in Political Science, Sociology, Law, and Economics
9 Conclusions and Implications for Global Governance 214   
1 Financial Reporting Standards Survey: Additional Results 227   
2 Product Standards Survey: Additional Results 234   
3 Financial Reporting Standards Survey: Additional Results 238   
  References 249   
  Index 289   


Importance and Timeliness of the Topic:  Over the past two decades, governments have delegated extensive regulatory authority to international private-sector organizations.  This internationalization and privatization of rule-making has been motivated not only by the economic benefits of common rules for global markets, but also by the realization that government regulators often lack the expertise and resources to deal with increasingly complex and urgent regulatory tasks.  In New Global Rulers, Büthe and Mattli examine who writes the rules in international private organizations, as well as who wins, who loses – and why.  The book offers both a new framework for understanding global private regulation and detailed empirical analyses of such rule-making based on multi-country, multi-industry business surveys.

Key Cases of Private Regulation of Global Markets:  The book examines three powerful international organizations that set rules for global markets: the International Accounting Standards Board (IASB), which develops financial reporting rules used by corporations in more than a hundred countries; and the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC), which account for 85 percent of all international product standards.  Seemingly technical, these rules have far-reaching consequences for firms, national economies, the global distribution of production and the stability of the international financial system.

Financial Reporting Standards specify, for instance, how profits and losses, research and development expenses, performance incentives for managers such as stock options, assets in an employee pension fund, and other transactions and events should be reflected in the accounts that firms make public in their financial statements.  Differences in financial reporting standards across countries impede the international integration of financial markets and undermine the efficient operation of already integrated markets—important motivations for the move to a single set of International Financial Reporting Standards (IFRS), developed by the IASB.  International harmonization of financial reporting, however, entails substantial adjustment costs and therefore conflicts of interest over the specific provisions that get written into the standards.  The resulting choices matter.  Financial reporting standards (also known as accounting standards) that result in accurate and comparable measures of each firm's financial position facilitate the efficient allocation of capital and boost public confidence in financial markets.  They also increase the control of senior managers in complex, multinational corporations.  Conversely, poor accounting standards that lead to inconsistent reporting can undermine market stability and therefore can bring economic hardship not just for shareholders but also for many with no immediate stake in financial markets.  The choice and change of financial reporting standards thus has momentous implications for individual firms and investors, as well as for national economies and the international financial system more broadly.

International Product Standards developed by ISO and IEC play a similarly important role in global product markets.  Such standards prescribe design or performance characteristics of manufactured goods, such as sizes, shapes, functions, labeling, or packaging; they also often stipulate the use of particular systems of classification or methods of testing.  Product standards as such are merely explicit norms in technical language, but there are numerous economic, legal, and political incentives for firms to comply with widely accepted product standards since they are often used for product specification in business and government procurement, interpreted by courts as indicative of "best practice" in product liability litigation, etc.  When product standards differ across countries, they become non-tariff barriers to trade (with estimated tariff equivalents greater than the average tariff rates for importing manufactured good into advanced industrialized countries), but product standards also affect, for instance, interoperability, interconnectability and thus the operation of systems, consumer and/or workplace safety, and quality assurance.  The choice of a single international standard for a given product thus not only entails conflicts of interest over the distribution of the switching costs but also has important implications for public policy, especially since governments have committed themselves in the WTO treaty to the use of international standards and therefore increasingly reference ISO and IEC standards in domestic laws and regulations, making compliance a prerequisite for market access.

Key Findings:  We find that global rule-making by experts in financial accounting or engineering is by no means just a technical but also a social and often highly political process.  Even though rule-making has shifted to the international level, domestic institutions remain crucial:  How stakeholders are organized at the domestic level has a large effect on their ability to shape outcomes at the international level.  The key reason is that influence in this form of global private governance is not a function of the economic power of states, but of the ability of domestic standards organizations to "complement" the international institutions (IASB, ISO and IEC), specifically domestic organizations' ability to provide timely information and speak with a single voice.  Such influence is particularly important in the frequent conflicts of interest over international standards between the United States and Europe.  We show how the capacity and organizational incentives to efficiently and widely disseminate information about the international standardization agenda to domestic stakeholders, as well as the ability of domestic institutions to aggregate the interests of domestic stakeholders, differ across these countries/regions and across industries.  Appendices provide additional information of interest to many practitioners and and policymakers, such as R&D and production standards managers' views of design vs. performance standards and financial managers' views about emergent issues, including the desirability of "fair value" or "mark-to-market" accounting rules.

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