No world government runs world society; no world president or prime minister can issue binding decisions. Much as the UN General Assembly might like to take on this role, no legislature makes global policy. Some international courts impose sanctions for some violations of international norms, but their authority hardly matches that of domestic judicial systems. Yet the world faces many problems that no single government can tackle by itself. Some problems spill across borders, as in the case of national financial troubles that endanger global markets. Others have to do with easing exchanges between countries, such as the case of devising common shipping methods to facilitate trade. Still other problems are really of planetary scope, most clearly in the case of environmental issues such as ozone depletion or global warming. If anything, globalization has helped to increase the number of such problems. The tighter web of global connections entails new risks as well as opportunities. But old political forms are poorly tailored to cope with several twenty‐first‐century problems. What is to be done about the mismatch? “Global governance” is the term used to describe the various efforts to find effective solutions for common problems, in the form of new norms, agreements, and institutions, all in the absence of an authoritative center or policy‐making body.
As commonly used, the term suffers from fuzziness. Introducing a volume on Globalization and Governance (1999), Aseem Prakash and Jeffrey A. Hart define governance as “organizing collective action,” which in turn “entails the establishing of institutions” made up of “rules of the game that permit, prescribe, or prohibit certain actions.” In their introduction to a similar book on Governance in a Globalizing World (2000), Robert O. Keohane and Joseph S. Nye define governance as “the processes and institutions, both formal and informal, that guide and restrain the collective activities of a group.” Global governance then minimally refers to organizing the collective action of many countries or guiding the collective activities of people from many places. To some extent, the fuzziness of the term is deliberate. Strictly speaking, governance includes government, but the point of invoking global “governance” is to highlight ways of doing things, of carrying out joint decisions affecting many people or places, without relying on conventional government as such and without claiming the mantle of a single global authority. In other words, the term is used broadly to encompass many border‐crossing or space‐spanning collective activities in the sphere between what states used to claim as their prerogatives and what a full‐fledged world government might claim as its proper domain. That sphere is large and growing – the key point that students of global governance try to convey. A somewhat fuzzy designation has the benefit of being inclusive.
Institutions of global governance come in many shapes and sizes. One is illustrated in the global environmentalism section (Part XI), namely, the regime intended to reduce the use of chemicals that harm the ozone layer in the atmosphere, arrived at through negotiations among states, strong backing by scientific experts, and pressure from NGO activists. It is just one of many such environmental “regimes,” that is, sets of norms and procedures addressing specific issues and typically implemented by designated organizations or officials. In our book World Culture (2005), we describe another governance institution, the International Criminal Court (ICC), established by a treaty among state members, backed by legal experts and supportive NGOs, and now in business in The Hague as the first global institution empowered to hold state officials individually responsible for war crimes or crimes against humanity. Though not a formal part of the UN system, it reflects the growth of law and law‐making in many bodies related to the United Nations, most notably the propagation of the human rights “regime” in the last several decades. A third example relates to the world economy. The Bank for International Settlements (BIS), founded before World War II, has evolved as the prime agency through which many central banks cooperate to assure global financial stability. Its Basel Committee on Banking Supervision has become perhaps the most important institution setting guidelines for banking operations. In response to the credit crisis and bank losses of the late 2000s, for example, it proposed stricter capital and liquidity requirements to prevent banks from overextending themselves, giving them a stronger cushion in case of new setbacks.
When it comes to protecting the environment, ensuring basic rights, or bolstering economic confidence, to mention only some prominent instances, “the world” has taken action through new institutions carrying out new responsibilities with new resources and authority. Precisely how well they do this is a matter of debate. Environmental regimes vary in effectiveness; the ICC has yet to demonstrate its clout; for all its influence, the BIS could not stem major bank losses. The factors that foster or hinder success within and across such arenas remain poorly understood. The autonomy of these global governance bodies, which purportedly are not beholden to traditional state interests, is also in question. This issue still afflicts the United Nations, for example, because it often does the bidding of powerful members rather than promote common interests. Directly or indirectly, many institutions of global governance are still accountable to specific governments. At the same time, it is fair to say that such governments often lose some of their hold over institutions in the long run. The UN is again a case in point, as its activities have greatly expanded beyond those contemplated in its Charter and the key founding member, the United States, often finds itself at odds with UN policies. How much autonomy global governance institutions actually achieve is a current topic for study.
Finally, while scholars are learning much more about individual institutions – many of which are intergovernmental organizations, or IGOs – the overall shape of global governance is far from settled. In some ways, the United Nations remains at the core of the emerging system, but governance institutions have proliferated across many fields in many directions. For lack of a common direction, some analysts view global governance as fragmented or disaggregated – an uncoordinated mishmash. Others view this state of affairs as simply inevitable bumps on the long road to a more full‐fledged world government. Sorting out the forces that ultimately determine the overall shape of global governance is another key item on the scholarly agenda.
The first selection in this section covers one of the most important governance institutions, the International Monetary Fund. Reviewing data from studies of the IMF’s programs, American political scientist James Vreeland describes how an institution originally intended to bolster financial stability by assisting countries with balance‐of‐payments problems – an area where it has had some success – has taken on a broader role to promote economic development, an area where its effects appear weak and have come at the cost of greater inequality. Its conditional lending is controversial, in part because it infringes on state sovereignty, but Vreeland finds that IMF involvement in state finances need not lead to drastic cuts in social spending. Another key economic governance institution is the World Trade Organization, founded in 1995 with the primary goals of promoting free trade and settling trade disputes peacefully.
An example of nongovernmental global governance is the work of the International Organization for Standardization (ISO), described by Americans Craig N. Murphy, an international political economy scholar, and JoAnne Yates, a management and communications professor. ISO is a nongovernmental organization that brings government experts together with industry representatives in standard‐setting bodies that, through voluntary consensus building, decide on guidelines for a wide range of activities, from manufacturing processes to specifications for screw threads to quality control. A striking example of its impact, recounted here, is the standardization it achieved years ago for the dimensions of freight containers, which greatly stimulated the expansion of cross‐ocean trade.
Our next two selections address developments in the governance of global health. Three British health researchers, Richard Dodgson, Kelley Lee, and Nick Drager, suggest that globalization makes it more difficult for governments to take care of their citizens’ health; “transborder health risks,” such as new epidemics, are a case in point. Instead of relying on intergovernmental cooperation, they advocate a more ambitious governance system in which states cooperate with nonstate actors, for example through public–private partnerships, to address a wider range of issues. This approach is exemplified by global campaigns against the marketing of breast milk substitutes and against tobacco use. One increasingly important “nonstate actor” is the Gates Foundation, the largest private philanthropic organization in the world. British physician David McCoy and his colleagues show that, by virtue of its considerable assets, the foundation helps to set priorities in global health governance, for example by emphasizing issues like HIV/AIDS and malaria rather than other health problems. Its policy leverage shapes global public health efforts and more broadly illustrates a new trend in global governance.
Finally, our selection on the United Nations’ Global Compact lays out the ten principles that companies joining the Compact are expected to implement, in the domains of human rights, labor relations, the environment, and corruption. It then reviews growth in participation in the Compact and efforts to further expand its reach, along with problems involved in enrolling more companies and implementing the principles. The ultimate goal of the Compact is “corporate sustainability” – companies meeting their responsibilities to their employees, the public at large, and the planet.