Transnational regulation of financial reporting standards
Accounting standards are frequently understood to be little more than formalized rules for the preparation of financial statements. The professional understanding emphasizes the allegedly apolitical nature of expertise, a notion upheld at the international level where many relevant standard setting decisions are taken today. An organizational analysis of the International Accounting Standards Board (IASB) shows to the contrary that the 35-year history of transnational standard setting in accounting has been characterized by contests between various interest groups striving to shape international standards and the institutions in which they are set.
Originally a private cross-border initiative, the IASB became the organizational centre of a transnational self-regulatory network dominated by accounting practitioners, auditing companies and a small number of international financial institutions. The project reconstructs the development of a private organization that has successfully managed to outcompete governmental efforts to harmonize standards across borders. The IASB managed to establish a long-lasting transnational arrangement in which standards are set that cater to the information needs of capital market actors. Drawing on institutional theory, the emergence of a stable transnational regulatory arrangement is assessed as a process of creating and maintaining a transnational regulatory path, which is characterized by the interrelation of accounting norms, organizational and procedural prescriptions as well as exclusive participation.
Part of this project is my PhD thesis, of which an abstract appeared in economic sociology_the european electronic newsletter, Vol. 10, Nr 3 (July 2009), p. 41.
Botzem, Sebastian and Sigrid Quack (2006): Contested rules and shifting boundaries: International standard setting in accounting. In: Djelic, Marie-Laure and Kerstin Sahlin-Andersson (eds.): Transnational Governance. Institutional Dynamics of Regulation. Cambridge: Cambridge University Press, 266-286.