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  • Governing Climate Change
  • Polycentricity in Action?
  • Online publication date: May 2018
  • pp 97-228
  • Publisher: Cambridge University Press


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Part III Polycentric Governance Processes

6 Experimentation The Politics of Innovation and Learning in Polycentric Governance

Jan-Peter Voß and Fabian Schroth
6.1 Introduction

Polycentric thinking seeks to develop a more holistic picture of governance (see Chapter 1). Polycentric governance theory acknowledges that, in addition to nation states, other initiatives contribute to the shaping of collective orders. They involve local governments, businesses, civil society organisations and social movements. A core proposition identified in Chapter 1 is that an experimental search for governance arrangements within diverse local settings will lead to effective solutions, performing better than states or some kind of monocentric, globally oriented system of governance. This reflects awareness of complexity and limits of central control, which require ‘reflexive governance’ (Voß and Kemp, 2006).

An interesting paradox, however, is that while polycentric thinking acknowledges the complexity of ecological and social systems, it says little about the complexity of social processes that are involved in devising, carrying out and evaluating experiments. This leads to a highly reductionist conception of governing. Of course, experiments help involved actors to learn about what is actually being tested and they contribute to problem resolution in that way. But how are decisions taken on what to test and how? What role do politics and power play here and how do they affect the experiments? Do actors experience different effects from the outcomes of experiments with new forms of collective order, or already from the process of undertaking them? To what extent are their various concerns and aspirations addressed by experimental processes, and how are they negotiated with each other? If we consider that all experimentation is deeply embedded in institutional, cultural and material settings and asymmetric power relations, we quickly realise that just by leaving institutional development up to decentralised trials, we may not promote universally best solutions, but in fact help already powerful actors to assert their visions of collective order against others (cf. Voß and Bornemann, 2011).

Our first aim in this chapter is to increase awareness of the fragility of expectations that are linked with this conceptual weakness in polycentric governance thought. We point to the idealistic assumptions about experimentation that the current discourse of polycentric governance hinges on. Following from this, our second goal is to offer a systematic account of where and how politics play out in the course of doing experiments, and to draw attention to the fact that in real-world contexts, experiments are likely to be shaped by asymmetric power relations. Our third goal is to caution against the uptake of polycentric and experimental governance concepts for orientating or legitimating governance interventions, unless a more realistic understanding of the practices of experimentation is taken as a starting point.

Before we start, let us introduce two key terms that we refine as we move along. Experimentation refers to the deliberate production of experiences for finding out what works.1 Politics is understood as the making of collectively binding decisions selecting from a diversity of deliberately judgments some to be realised.2 Broadly defined, the politics of experimentation thus occur whenever, throughout a process of creating novelty and making experiences, diversity is transformed into unity. Most obviously, this happens when controversies over findings are fought out in public, but it also occurs more inconspicuously when decisions are made about what needs to be known, which hypotheses are to be tested and which observations are to be made. Often, no one cares to contest such decisions as they are thought to be just epistemically, but not politically relevant.

6.2 Experimentation in Polycentric Governance

A closer look at the polycentric governance literature reveals that, even if it has developed into a much broader evolutionary philosophy of governance, it still carries forward some of the ontological assumptions from institutional economics (Ostrom, Gardner and Walker, 1994; Ostrom, 2011; Cole and McGinnis, 2014; Thiel, 2016). Polycentric governance theory emphasises decentralisation, local embedding and responsiveness to specific contextual conditions, along with the potential to mobilise entrepreneurial initiatives, also against incumbent powers and rigid institutions. The underlying imaginary is a constantly evolving institutional landscape (see Chapter 1). As such, the concept immediately attracts attention as a preferable alternative to the cumbersome business of coordinating state action on global problems like climate change through international diplomacy (Ostrom, 2010; Cole, 2015; Dorsch and Flachsland, 2017). The concept offers hope in times when ‘big politics’ appears to fail. Yet the expectation is not only that self-organisation will step in to fill gaps that are left open by state government and international institutions. The current discourse also raises the expectation that it would be actually preferable to actively withdraw state oversight to leave more space for self-organised institution building, because this would produce forms of governance that are better adapted to a diversity of socio-ecological contexts, and would thus be more effective and legitimate.

All this hinges on particular assumptions about experimentation that are imported from the functionalist evolutionary theory of institutional economics that originally inspired the articulation of the concept. First, there is the assumption that new institutions are freely created (in effect, randomly generated variations). And second, that selection works on the basis of feedback and adjustment within particular contexts (leading to a survival only of the fittest, best-adapted institutions that generate maximum utility for those who adopt them). Only if these assumptions about the inner workings of experiments are correct can we assume that experiments deliver trial-and-error learning that eventually results in governance that works well for all. When these assumptions are incorrect, however, the result would be quite a different scenario. Curtailing the regulatory monopoly of the state and liberalising the market for experimental institution building may, in this scenario, fail to bring about a world of governance bubbling with creativity and responsively adapting to the needs of the people, and instead lead to the emergence of a private oligarchy that can work more or less undisturbed by constitutional rules, public accountability and democratic control – which would have applied under a more monocentric or state-led system of governing.

Let us take a closer look at experimentation in polycentric governance. It generally appears as a central proposition in the discourse (Ostrom, 2010; Cole, 2015: 115; Dorsch and Flachsland, 2017; see also Chapter 1). There is overlap with partly connected discourses of experimentalist governance (Sabel and Zeitlin, 2012; De Búrca, Keohane and Sabel, 2014) and experimentation for sustainability and decarbonisation (Kemp, Rip and Schot, 2001; Hoffmann, 2011; Sengers, Wieczorek and Raven, 2016), or more specific discourses on urban experiments (Bulkeley and Castán Broto, 2013; Bulkeley, Edwards and Fuller, 2014; see more generally Ansell and Bartenberger, 2016). Despite its centrality, however, the concept of experimentation is weakly developed in polycentric governance theory. Experiments are primarily understood as idealised methods, or are understood through the lens of expected effects (producing a variety of new and robust innovations), but not so much through the lens of the social processes in which they are done and from which actual effects could emerge.

We can discern two strands of philosophical thought in the literature on experiments in governance: a positivist-utilitarian strand and a pragmatist-interpretivist strand. In both strands, experiments are understood to generate solutions to perceived problems by trying out what happens when visions are put into practice. A fundamental difference is, however, that the former sees experiments as a process of adapting to reality, and the latter sees them as a process of making reality. Let us elaborate. The positivist-utilitarian framework assumes that the subjective and the objective world are ontologically separate. The generation of theoretical hypotheses is a matter of human ingenuity while the senses, if methodically controlled, can provide neutral data of an independently existing, objective world. The key task of experiments, then, is to provide empirical observations for selecting theoretical hypotheses about institutional designs and their effects (Campbell, 1969; Stoker and John, 2009; Abbott and Snidal, 2016). Within the pragmatist-interpretivist framework, however, the world is understood to be essentially in flux. Subject and object are both part of this process. Within it, human imagination and the material world constitute each other, mediated by motoric and perceptual capabilities, in active human interventions and the experiencing of consequences. Experimenting thus is a way of deliberately changing the world. It enables learning, not about a pre-existing reality, but about the possibilities of knowing and doing reality differently. It is never neutral, but always geared towards specific concerns, and irreversibly transforming the world (Dewey, 1986; Evans, 2000; Ansell, 2016).

While epistemologically these two strands of experimental philosophy are fundamentally different, neither of them provides fine-grained discussions, or illuminating empirical analyses, of experimental processes in governance. In both strands, there is little concern for social interactions and the nitty-gritty of actually doing experiments. As a result, they both neglect the politics of experimentation. Positivists see experimentation as a way to bypass the political resolution of conflicts because ‘nature’ becomes instituted as a neutral arbiter. Decisions are handed over to the ‘jury of experience’, which becomes objectified through methods of science (Norton, 2005: 79). Pragmatists, in contrast, do not assume neutrality, but unanimity or at least equality in the process of collectively conducting experiments (Wilkinson, 2012). They assume that social interactions unfold under conditions of freedom and symmetrical relations – as explicated, for example, through Habermas’ (1981) model of communicative action or Lindblom’s (1965) model of mutual adjustment. If politics is mentioned, it is restricted to something that exists outside of experiments: to how experimenters struggle with incumbent interests and ideologies or how different experiments compete for space (Misiko, 2009; Hoffmann, 2011; Bulkeley et al., 2014; Evans, Karvonen and Raven, 2016).

The possibility that experimentation may be captured by dominant interests and used for them to realise their own particular visions of collective order is ignored in current discourses of polycentric and experimental governance, either because it is assumed that objective conditions will determine the course of experiments or that power is absent or symmetrically distributed among those involved in and affected by experiments. That is the case despite empirical case studies suggesting that experimentation in governance is imbued with conflicting interests and asymmetric power relations.

A prominent example is the case of ‘transition management’, which is heralded as an approach for experimentally searching for pathways of sustainable system transformations in energy, agriculture, mobility and so on (Kemp and Rotmans, 2009; Voß, 2014). Experience with transition management in the Netherlands has shown that the process of defining experimental agendas and evaluating results can be easily captured by incumbent networks of administration officials and big companies for pursuing innovation strategies especially geared towards the growth and competitiveness of particular branches and firms (Kern and Smith, 2008; Heiskanen et al., 2009; Kern and Howlett, 2009; Meadowcroft, 2009). This demonstrates the relevance of considering politics and asymmetric power relations, if experiments are not to undermine democracy and allow powerful actors to assert their interests (Hendriks, 2008, 2009; Voß, Smith and Grin, 2009; Voß and Bornemann, 2011; Pel, 2016). Because we seek to address this deficit in the conception of polycentric governance, we now move to discuss where the politics of experimentation can be found more specifically.

6.3 The Politics of Experimentation: Configuring Experimental Infrastructure

The practice of experimental inquiry has been a focus in science and technology studies. This led to the insight that experimentation is a social process, with decision-making deeply embedded in historically grown cultural and institutional patterns with asymmetric relations and established power positions. A key finding of so-called laboratory studies is that experimentation not only takes place within a societal context that affects what comes to be known, but also within specifically configured material settings that are deliberately shaped according to particular research interests and theoretical constructions of the phenomena that are tested (Knorr-Cetina, 1995). Massive laboratory complexes are a case in point, but this also applies in less visible configurations as when sight is focused through a telescope or field studies are conducted by systematic surveying and the drawing of probes (Latour, 1999). The general point is that, in practice, experimentation occurs in socio-material settings that are preconfigured according to some theoretical model of what it is that is to be tested, and that they, to a greater or lesser degree, provide for seclusion from the wider world (Callon, Lascoumes and Barthe, 2009). This is one of the key conditions of success for modern science: by reducing, simplifying and purifying a complex macrocosm of ‘reality out there’, already before any experiences are made, it makes specific phenomena experimentally demonstrable and knowable that would otherwise always be overwhelmed by the complexity of actual interactions and continuous change. In effect, experimentation fabricates the realities that it comes to know, rather than discovering them in nature (Knorr-Cetina, 1981; Hacking, 1992; Rheinberger, 2005). This includes the careful composition of a collective of trained and professionally disciplined experimenters to cultivate convergent ways of thinking, intervening and sensing (Fleck, 1994).

Experimentation thus appears as a particular mode of collective ordering, working through three steps (see Figure 6.1): (1) the selective reduction of reality ‘in the wild’ by building simplified local realities; (2) the experimental construction of local realities for the creation and controlled reproduction of theorisable phenomena in a confined setting; and (3) the expansion of experimentally created orders, by claiming that theories and data describing these phenomena represent universal properties of nature and by developing technology to replicate them elsewhere.

Figure 6.1 Experimentation as ‘secluded research’. (2009)

Source: Callon et al.

In these three steps, the world becomes creatively transformed. At least with the final step of expanding experimentally configured orders, they also come to be binding on others who were not involved in making them. Against this background, scientific experimentation is claimed to work as ‘politics by other means’ (Latour, 1983) or as a form of ‘ontological politics’ (Mol, 1998).

An illustrative example from the world of climate governance is the way in which the Kyoto Protocol’s Clean Development Mechanism (CDM) was given shape through experiments that were set up for testing how emission reduction commitments under the United Nations Framework Convention on Climate Change (UNFCCC) could be fulfilled through international cooperation. A reconstruction of the process shows how experimentation in pilot projects not only produced special expertise, exemplary working arrangements, and more generally applicable methods but also contributed to realise a particular version of international cooperation. This version was very much geared towards the interests of private investors, as it allowed the trading of carbon emission offsets (Schroth, 2016). When the concept of ‘joint implementation’ of national reduction commitments was introduced in the late 1980s by the Netherlands and further developed by Norway and the United States, it was highly controversial (Paterson, 1996; Trexler and Kosloff, 1998). Concerns over international justice, asymmetrical power relations between the North and South (see Chapter 18), capacity-building and technology transfer, efficiency and reduced costs for fossil-fuel intensive industries, as well as the mobilisation of private capital and the making of new markets, suggested different directions for developing the proposal and different criteria for evaluating what works. From early on, however, advocates like Norway, the Netherlands and the World Bank started with experiments to test and demonstrate how international cooperation could work. In the late 1980s, they started with small-scale experiments to generate emission offsets by electric companies investing in reforestation projects in Guatemala. In the early 1990s, projects with energy efficiency investments in Mexico were undertaken. From 1993, experimentation with joint implementation proliferated through a dedicated programme set up by the US government (Jepma, 1995). In 1995, the UNFCCC officially endorsed a pilot phase, then called ‘Activities Implemented Jointly’. The insights and technical designs that were brought forward in these experiments turned out to reflect concerns about the mobilisation of private capital and establishing a new market more than any other of the concerns originally raised and politically debated under the UNFCCC. With the social momentum, evidence and the technical solutions that were generated, a decade of experimenting had created a new reality. With the 2001 Marrakech Accords, experimentally constructed arrangements for a CDM were finally adopted as a flexible mechanism for implementing international commitments under the Kyoto Protocol.

Next, we take a closer look at what is at stake in each of the three dimensions of reduction, construction and expansion and where asymmetric power relations can shape the experimental process.

6.3.1 Reduction: Modelling the World and Building a Test-Stand

A first point at which decisions are taken is that a research problem is identified and a basic analytical framework is deployed, which is then translated into the design and installation of a ‘test-stand’. This is a specifically prepared observational setting, ‘a simpler, more manipulable reality’ that replaces the unselected and overwhelmingly complex world as it actually unfolds ‘in the wild’ (Callon et al., 2009: 50). Many foundational decisions are thus taken before the actual experimenting starts. During the subsequent process, however, these arrangements move into the background, working as a hidden experimental infrastructure that is taken for granted as ‘trials on nature’ proceed. The presumptions and considerations that led into decisions on this initial set-up, or reflections on what was excluded from the outset and could therefore not be observed, tend to be forgotten when results are publicly presented (Latour, 1987).

An example from the CDM case is that particular forms of economics and engineering expertise had been assembled with a focus on testing methods to verify emission reductions per invested dollar, by measuring emissions of several greenhouse gases, calculating baseline scenarios and allocating portions of declared reductions between host and investor. Specific projects and sites were selected against the background of this framing and agreements with involved actors were negotiated in this orientation (Schroth, 2016: 82–107). While these methodological decisions were presented as technical issues, they presupposed a decision for cost-efficiency and the mobilisation of private capital as primary purposes of joint implementation – an issue that in the wider public and in the UNFCCC was still controversially discussed.

6.3.2 Construction: Creating Ordered Phenomena in Seclusion

The actual carrying out of trials starts within a reality that has already been selectively reduced. It then takes place through an iterative process of refining theoretical propositions, designing interventions, making observations and fine-tuning the material setup for the next round of experiments. This involves decisions to specify the experimental agenda in dealing with situational contingencies and to arbitrate between various possible ways to make sense of what happened. Even if attempts are made to objectify criteria, it involves ‘interpretive flexibility’, which is to be overcome by social means like status, threat, rhetoric or negotiation (Gilbert and Mulkay, 1982; Collins, 1983). Making decisions within the research collective thus is a form of micropolitics that helps to arrive at shared results and create a new way of collectively knowing and doing reality among selected actors and within a confined local setting (Callon et al., 2009: 52).

In the case of the CDM, crucial design issues and conclusions on the outcomes of experiments were resolved among experts involved in the pilot projects, coming from non-governmental organisations, the Organisation for Economic Co-operation and Development, the World Bank, research institutes, companies and agencies (Schroth, 2016: 108–129). They translated the issue of shared global responsibility for climate change into an issue of measuring emission effects of investments, thus bypassing political processing of diverse concerns and instead pursuing a particular concern as an epistemic and technical matter of testing facts. Working out ways to make joint implementation work was thus removed from the political forum of the UNFCCC and shielded from broader public scrutiny. The selected group of experts eventually came to the conclusion that ‘in the absence of credits, investments in [joint implementation] projects will not reach the level necessary to fully realise the potential of this concept’ (Dixon, 1998: 3) – a technical answer to many politically fraught questions related to crediting, the involvement of private investors and even the overall purpose of international cooperation projects in the first place.

6.3.3 Expansion: Generalising Local Achievements

Finally, politics occurs in the generalisation of experimental findings. Initially, findings are only locally true. The challenge is to turn what a few people have learned within a particularly configured experimental space into a collectively shared fact. This requires a disconnection from specific interpreters and circumstances. Descriptions must be formulated in abstract, decontextualised ways. In order to reproduce findings and use interventions that have been tested in the confines of the experimental setting, the experimental infrastructure needs to be turned into a ‘technology’, a transportable package with a reliable function. In effect, it also requires that other sites within the macrocosm are reconfigured after the model of the experimentally arranged microcosm: ‘For the world to behave as in the research laboratory, … we simply have to transform the world so that at every strategic point a “replica” of the laboratory, the site where we can control the phenomena studied, is placed’ (Callon et al., 2009: 65). To achieve this, the experimental collective needs to recruit broader support, mobilise collective action and build legitimacy in interaction with powerful stakeholders and broader publics.

In the example of the CDM, this challenge is clearly visible in bringing results from experiments back into the UNFCCC (Schroth, 2016: 130–148). Crucial for this was the generation of support by raising economic interests in replicating experimentally configured solutions. The World Bank played a key role here. It adopted procedures and methods, as had been developed in pilot projects under the US joint implementation programme, and adopted them in the guidelines for a new fund for private investors, the Prototype Carbon Fund. A larger constituency of firms and governments was thus enrolled for installing a new wave of projects after the concept of joint implementation as developed in the pilot projects, and thus for replicating that experimentally configured reality elsewhere. This generated momentum, which eventually led to a shift in international negotiations under the UNFCCC as resistance against a private offset market from the alliance of G77 and China crumbled (van der Gaast, 2015). Finally, after the pilot phase of Activities Implemented Jointly, it was stated as a matter of fact that it ‘has demonstrated that, for the Kyoto project-based flexibility mechanisms to work effectively, the private sector will need to be engaged through appropriate incentives’ (UNFCCC, 1999: 6).

Since decisions taken within the experimental collective only really start to affect others when experimental creations are expanded, the process of mobilising acceptance and support for replication is a key moment in the politics of experimentation. This is where the micropolitics of experimentation turn into macropolitics. In polycentric theory, this is usually rather unproblematically referred to as diffusion and ‘upscaling’. In the following section, we take a closer look at two specific mechanisms and at how they work together.

6.4 The ‘Scaling Up’ of Experimental Results
6.4.1 Generating Epistemic Authority: Performing the ‘Representation of Nature’

A first way in which locally generated truths can expand is by gaining acceptance for the claim that they are indeed of wider validity and importance. To this end, results are formulated in abstract and general terms, as decontextualised accounts that can circulate, while linkages with the actual experiment are maintained as chains of reference. By erasing particular concerns, interactional dynamics and situational contingencies that shaped this particular process, the experimental findings are turned into neutral representations of universally given conditions of nature. As such, they appear relevant even for those who were not themselves involved in the creative production of these findings, neither taking constitutive decisions nor actually making experiences (Gilbert and Mulkay, 1982; Shapin, 1984; Latour, 1987). If the claim to represent nature becomes accepted by a wider audience, local experimental findings are vested with epistemic authority. ‘Applying’ them for a reconfiguration of collective orders elsewhere thus shifts from being a matter of trusting that decisions among experimenters also reflect one’s own values and measures of relevance into a matter of rationally coping with factual requirements.

In the process of innovating governance instruments like emissions trading (Voß, 2007a; Simons, Lis and Lippert, 2014), transition management (Voß, 2014) or methods of public participation (Voß and Amelung, 2016), it has been shown how the translation of findings from experiments into authoritative epistemic claims led to the establishment of facts about their functioning among a growing constituency. This is an achievement that is not necessary nor irreversible. The expert literature plays a key role here, as it establishes facts about the functionality of a general model of governance across a series of experiments (Simons, 2015, 2016).

6.4.2 Generating Political Authority: Mobilising ‘Instrument Constituencies’

A second way of expanding experimentally shaped orders is by generating collective will and agency for developing experimental findings into a general instrument for solving problems of governance. In addition to generating epistemic authority, as described earlier, collective action can also be mobilised by attracting wants and desires of actors from beyond the original experimental collective. Additional actors may become enrolled for the aesthetic attraction of a world modelled after the experiment or for the expectation that it solve their own problems or otherwise benefit them, if practical efforts were undertaken to reproduce the experimental order beyond the confined setting of first trials (Akrich, Callon and Latour, 2002). Supporters may, for example, be recruited by raising expectations of increased demand for products and services, or of institutional authority and expert positions in fields like public administration, business, civic activism, science etc. (Voß and Simons, 2014: 739). Apart from mobilising a wider array of actors, there is the challenge of orchestrating an enlarged constituency with more diverse attachments and expectations. This involves the articulation of ‘representative claims’ (Saward, 2006) on a collective will and interest in developing the experimental configuration into an instrument. When they are adopted by constituency members, this ‘produces temporarily associated wills’ (Latour, 2013: 133) and generates political authority to be used for legitimately articulating collective action strategies and norms.

A dedicated effort to enrol a wider set of actors for the expansion of early experiments with emissions trading can be seen in ‘Project 88’ (Voß, 2007b; Simons, 2015). It was initiated by committed members of an experimental collective that emerged around the first trials with emissions trading at the US Environmental Protection Agency (EPA) in the 1970s. The project brought together spokespersons from industry and the environmental movement, from different states and from the US Republican and Democratic parties. Through a series of workshops and negotiations, it eventually produced a policy proposal supported by a widespread and influential constituency (Project 88, 1988). This in turn was taken up by the incoming president, and the constituency was mandated with the task to install the US Acid Rain Program as the then-largest emissions trading programme. Though the Acid Rain Program was not concerned with greenhouse gas emissions, it became a crucial stepping stone for inserting emissions trading into climate policy and expanding the constituency transnationally, such as founding the International Emissions Trading Association in 1999.

6.4.3 Co-producing Epistemic and Political Authority: ‘Realising Governance’

So far, we have highlighted various points at which politics occurs in the experimental process. Studies which follow particular models of governance along their historical pathways of development also show, however, that they become articulated over a series of different experiments (Muniesa and Callon, 2007; Callon, 2009). Along the innovation journey of such models, one can find experiments that are geared specifically towards epistemic or political authority generation, as described earlier, and discern a ping-pong pattern in which they play together (Voß, 2014, 2016). Epistemically oriented experiments gradually produce harder facts on the basis of more sophisticated models that process more data and generate increasing evidence for arguing necessities and possibilities of collective action. They are carried out by experts in the laboratory or otherwise highly controlled circumstances, and are concentrated on fact-making in support of the functionality of governance models. Politically oriented experiments are associated to them. They gradually assemble broader and more powerful coalitions for installing larger real-world cases and for funding further research efforts to draw empirical data and provide evaluations. In these experiments, the focus is on testing claims about collective interests for policy-making and reconfiguring practices out in the field. Like pistons in a reciprocating engine, both types of experiments can so work together for the ‘realisation’ of new forms of governance, both in knowing and in doing (Voß, 2014).

Here again, emissions trading provides an instructive case. From the early 1970s until 2000, economic models and experiments ‘in silico’ have been developed in close interplay with policy coalitions and experiments ‘in vivo’ (Voß, 2007a; Simons, 2015). While designs and evidence of their effects were simulated in computer models, these results were taken up, for implementation, first in a tentative trial at EPA and later for the Acid Rain Program as a large-scale policy experiment. Both policy processes fed model-based experiments with data and mobilised public support for this kind of research. Epistemic and political authority in support of emissions trading were thus co-produced over a series of interconnected lab and field experiments (Voß, 2016).

6.5 Conclusions

We have shown that the experimental process involves several decision moments. Every decision has the effect of including and excluding, and of granting more central positions to some actors rather than others. It would be an illusion, or a tactical masking, to presume that experimenting could somehow delegate all those decisions to nature or objectify them through method.

Since there is an inescapable social component in all experimenting, we may expect established power relations to shape experimental agendas and outcomes. Studies of the actual conduct of experiments in governance testify to this point. Without any further provisions, a greater role for experimentation in the shaping of collective orders, as polycentric governance theory proposes, would allow a few already powerful actors to realise their particular visions of governance at the expense of others who do not get to test theirs. At the same time as it would provide spaces for unregulated power play, it would make politics less visible, because decisions about collective order would be displaced from political arenas to more or less closed projects in which selected experts and stakeholders negotiate the future in apparently technical terms. The neglect of politics in polycentric and experimental governance theory contributes to this.

What are we to make of this? A first point would be to be attentive to problem frames and deeper ontological presuppositions that are inscribed in experimental infrastructures. We need to have a closer look at the processes in which decisions are taken in this respect. To develop our understanding of experimentation, more detailed empirical studies are needed of how governance experiments are actually done and how politics and power play out at the micro level of social interactions within certain experimental projects. Which alternative problems, research questions, experimental designs, measurement options and interpretations of results are articulated, which ones are suppressed and how are some asserted against others? Following up on these questions would require an interpretive and practice-oriented research approach that allows for empirically tracing the negotiation of problem frames and ontological assumptions while experimental infrastructures are socially and materially configured.

A second point would be to build on such studies for explicating the politics of doing governance experiments and to start thinking about a constitution. So far, experimental politics, because of their existence in the shadow of critical analysis and public attention, allow the fittest to survive. For civilising the ‘Wild West’ of experimental politics, they would need to be turned into a public issue so that a wider discussion is opened about how they should be done and how overarching rules could be established (Thiel, 2016; see also Chapter 1).

Finally, what is at stake here are future world orders that are collectively to be cherished or endured by ‘the people’. This brings democracy back in. The most crucial problems of polycentric governance as currently debated and advocated are that it ignores issues of legitimacy and justice by implicitly assuming some kind of pluralistic equilibrium (see Chapters 18 and 19). Yet, as polycentric governance ‘escapes the control of nation states’ (see Chapter 1), it simultaneously escapes the constitutionalisation of politics that has been fought over for centuries. Once upon a time, only princes and bishops experimented with governance. Polycentric governance, as it stands, would just evade democratic principles and open the field for new princes and bishops to emerge, perhaps in the shape of self-appointed sustainability stewards, experts, corporations and charities. Thus a major challenge is to make sure that experimental politics receive public scrutiny and to give it a solid democratic constitution.


1. We here refer to John Dewey’s pragmatist conception of experimentation as inquiry (1986). As such, it is not limited to science or the production of theoretical knowledge, nor to specific settings and methods like laboratories or randomised controlled trials.

2. The usual reference for this formulation is Easton (1957), but we do not adopt a system-functional framework and rather take the effect ‘collectively binding’ as an occasion to empirically look out for the processes that constitute it. Here we deliberately look beyond legislation and include the cultural establishment of rationalities, values, facts and material arrangements, if respecting and adopting them is required for participating in a collective practice.

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7 Entrepreneurship A Key Driver of Polycentric Governance?

Elin Lerum Boasson
7.1 Introduction

What do investment banker Tessa Tennant, former California governor Arnold Schwarzenegger, European Commission official Jos Delbeke and former London mayor Ken Livingstone have in common? They are all climate governance entrepreneurs. Drawing on academic studies of these and other entrepreneurs, this chapter argues that an entrepreneurship approach can help analysts to understand why some actors, in some situations, seem able to significantly accelerate, stall or shift climate policy and governance. Moreover, the shift towards more polycentric climate governance potentially affords governance entrepreneurs an even more important role as drivers or inhibitors of new governance developments.

Governance entrepreneurship is by no means a phenomenon that pertains only to polycentric governance. Over the years, political scientists and sociologists have explored how entrepreneurship plays out in a wide variety of contexts (e.g. Huitema and Meijerink, 2009; Green, 2014; Jordan and Huitema, 2014; Boasson, 2015). The rapidly expanding literature on environmental and climate governance focuses on entrepreneurship at many different levels and in many different sites of governing: local and regional (Brouwer, 2013; Anderton and Setzer, 2017; Maor, 2017), national (Huitema and Meijerink, 2009; Boasson, 2015; Hermansen, 2015), supranational (Buhr, 2012; Boasson and Wettestad, 2014) and transnational (Green, 2014; Pattberg, 2017). This chapter seeks to add to the more nuanced picture of entrepreneurship that these authors have painted, avoiding the trap of heralding entrepreneurs as heroic figures. This chapter neither defends nor questions the development of more polycentric forms of governance. Rather, it uses polycentric governance as an explanatory concept to help explain the role of entrepreneurship in climate governance.

This chapter explores three main questions. First, how should climate governance entrepreneurship be understood, defined and operationalised? Second, to what extent and how may we expect entrepreneurship to play out in polycentric governance as compared to monocentric governance? Third, what are the potential limitations of applying an entrepreneurship lens to the analysis of climate governance?

7.2 Defining Climate Governance Entrepreneurship

Political scientists have a long tradition of studying actors that aim to achieve extraordinary things. Yet there is still confusion about what entrepreneurship actually means, how to apply it as an analytical tool in empirical research and how to perform entrepreneurship studies in a way that fosters cumulative research. Let us therefore first explore how climate governance entrepreneurship can be understood, defined and operationalised.1

Back in 1961, Dahl argued that policy entrepreneurs are especially ‘skilful or efficient in employing the political resources at their disposal’ (Dahl, 1961: 272, emphasis in original). Polsby (1984: 171) emphasised a different aspect, regarding entrepreneurs as actors ‘who specialize in identifying problems and finding solutions’. However, it was Kingdon who offered a more detailed theorisation and conceptualisation. He held that entrepreneurs are characterised by their ‘willingness to invest their resources – time, energy and sometimes money – in the hope for a future return’ (Kingdon, 2011: 122).

His definition is very broad: it could conceivably apply to all actors aiming to influence policy development. Roberts (1992: 56) argued that it was difficult to evaluate the state of entrepreneurship research because there was no consensus on what entrepreneurship was. This challenge persists, despite the substantial empirical and theoretical contributions published since the early 1990s. For entrepreneurship studies to prosper, it is important to develop a clearer understanding, starting with clear definitions. Various scholars define entrepreneurs by their skills. For instance, Fligstein (2001: 107) has argued that entrepreneurs are skilled societal actors who will be ‘more skilful in getting others to cooperate, manoeuvring around more powerful actors, and generally knowing how to build coalitions in political life’. In a similar way, Dahl argues that ‘[s]kill in politics is the ability to gain more influence than others, using the same resources’ (Dahl, 1961: 307). Fligstein, Dahl and Polsby also indicate that creativity is a key skill, because it enables entrepreneurs to find new paths to influence. The assumption that skills are the most important defining feature is intuitively appealing. Indeed, some actors are better at assessing the political context than others. Sometimes their influence may extend far beyond what could be expected on the basis of their formal position or role. One problem here, however, is that the identification of superior abilities and personal character is difficult to operationalise. How can a person’s intrinsic skills and qualities be measured? Moreover, skills are not likely to translate into actions in all situations and at all points in time. In identifying entrepreneurship, it is thus more fruitful to focus on entrepreneurial strategies and actual actions. Ackrill and Kay (2011: 78) suggest that entrepreneurship should be regarded ‘as a general label for a set of behaviours in the policy process, rather than a permanent characteristic of a particular individual or role’. Sheingate (2003: 198) actually argues that in the study of entrepreneurship, it is a mistake to focus on the personal qualities of individuals, ‘for this … limit[s] the utility of the concept to the study of “great men”’. Instead, Fligstein and McAdam (2012) argue that the position of entrepreneur is a role that becomes available under certain social conditions. It is up to the actors involved in the process to seize the moment and exert entrepreneurship.

In this chapter, I understand entrepreneurship as acts performed by actors who seek to ‘punch above [their] weight’ (Green, 2017). By contrast, actors who merely ‘do their job’ and do what is ‘appropriate’ cannot be considered entrepreneurs. Two different categories of entrepreneurship can be identified (see Boasson, 2015; Boasson and Huitema, 2017). Institutional-cultural acts are aimed at enhancing influence by altering the distribution of authority and information. They require scholars to pay close attention to the use of decision-making procedures and venues (Roberts and King, 1991; Schneider and Teske, 1992; Moravcsik, 1999; Leca, Battilana and Boxenbaum, 2006; Hardy and Maguire, 2008; Mintrom and Norman, 2009; Mackenzie, 2010; Kingdon, 2011; Fligstein and McAdam, 2012). By contrast, structural acts aim at altering or diffusing norms and cognitive frameworks, worldviews and institutional logics. It requires scholars to explore activities such as framing, image-making and persuasion (Goffmann, 1974; Snow and Benford, 1988; Campbell, 2004; Goodin, Rein and Moran, 2006; Baumgartner and Jones, 2009).

Many entrepreneurship scholars have been interested in entrepreneurship as a vehicle for change (i.e. the entrepreneur as a disruptive agent). Even if many entrepreneurial acts aim at producing change, and even if the most common criterion for successful entrepreneurship is achieving change, it is important to be open to the possibility that an entrepreneur can also block change (Boasson and Huitema, 2017). Moreover, given the complexity of the contemporary climate governance landscape (see Chapter 1), it is not always clear which governance measures will work and which will be counterproductive. Hence, we should include all kinds of entrepreneurial motivations when we study polycentric climate governance.

Moreover, we should take into account that governance entrepreneurship is a broader term than policy entrepreneurship. Governance covers traditional forms of public policy as well as private, and public-private initiatives aimed at influencing, steering and coordinating behaviour (see Chapter 1). Hence, entrepreneurship aimed at influencing private and public, as well as public-private, decision-making should be taken into account.

7.3 The Role of Governance Entrepreneurship in Polycentric Governance

Back in 1997, many regarded the signing of the Kyoto Protocol as the first step on the path towards a monocentric global regime. Instead, climate governance subsequently adopted many more characteristics that can be described as polycentric. Changes in the basic landscape of climate governance have important implications when it comes to understanding the actual and potential roles of entrepreneurship. To shed light on this, I explore entrepreneurship under two simplified but contrasting conditions: polycentric and monocentric climate governance. Monocentric and polycentric governance differ in at least two respects (see Chapter 1):

  1. (1) Whether steering and coordination is induced top down from global, intergovernmental agreements or bottom up from a variety of countries, sectors and domains.

  2. (2) Whether climate mitigation relies on a few intergovernmental measures or a whole variety of measures adopted in international, transnational, national, subnational and private domains.

Figure 7.1 combines the two dimensions and shows that – depending on the degree of top-down steering and the number of measures in use – we are likely to find different modes of climate governance. Strong top-down steering combined with few measures and instruments would produce monocentric climate governance, while bottom-up developments combined with a great number of diverse measures and instruments would result in polycentric governance. For the sake of simplicity, I rely on the definition of polycentric governance outlined in Chapter 1.

Figure 7.1 Possible climate governance patterns.

Figure 7.1 aims to illustrate that the two dimensions (top down versus bottom up, and few versus many policies and measures) can exist in various degrees, and that polycentric governance and monocentric governing are ideal types that can guide the analysis but that will not be found as such in reality. Nevertheless, climate governance following the adoption of the Kyoto Protocol (from 1997 until around 2009) can be considered closer to the monocentric ideal than climate governance after the Paris Agreement. The Kyoto Protocol had important monocentric traits: it was based on binding commitments, targets and timetables for emissions reductions and detailed rules pertaining to collaborative efforts to reduce emissions, such as the Clean Development Mechanism and Joint Implementation (Andresen and Boasson, 2012). The Paris Agreement does away with most of these monocentric features, has weak central steering and follows a more bottom-up form of governance, in which countries make pledges to address climate change, which are subsequently subject to review (see Chapter 2).

Analytically, distinguishing between the two ideal types – polycentric and monocentric climate governance – can help us to develop more tangible expectations and predictions as to what role entrepreneurship can and will play in climate governance in the years ahead. Next, I discuss what implications these two forms of governance may have for climate governance entrepreneurship, paying particular attention to differences relating to (1) the number of measures and instruments; (2) policy windows; and (3) coordination across levels and domains.

Starting with the first of these, ever since the Kyoto Protocol was negotiated, actors that have promoted monocentric climate governance have sought to put a price on greenhouse gas emissions. I thus assume that this measure will play a superior role in this type of governance (see Andresen and Boasson, 2012; Boasson and Lahn, 2016). Under more polycentric conditions, the greater willingness and ability to experiment will probably lead to multiple parallel and partly overlapping measures (see Chapters 1, 6 and 14). This will again tend to create multiple parallel and partly overlapping policy and governance patterns at different domains and at various levels (local, national, international and transnational).

The entrepreneurship literature indicates that many overlapping decision-making venues at various levels can be a valuable asset for entrepreneurs (Boasson and Huitema, 2017), as it creates more entrepreneurial opportunities. One may argue that climate governance will in any event be complex – given the many sectors and actors involved in mitigating emissions – but a polycentric governance model will arguably increase this degree of complexity. I assume that polycentric climate governance will entail more, and more varied, entrepreneurship across levels of decision-making and societal domains, while a reversal towards more monocentric climate governance will reduce the volume and diversity of entrepreneurship. This assumption is rooted in existing research on how entrepreneurs respond to complexity. Newman (2008: 121) shows that duplication of authority structures in the European Union (EU) offers increased possibilities for societal groups to exert entrepreneurship (see also Börzel and Risse, 2003: 67). Mackenzie (2010: 383), studying Australian policy development, observes that a multiplicity of policy forums in the federal political system in Australia provides ‘policy entrepreneurs with more avenues through which to pursue their innovations’. According to Sheingate (2003: 187, 191), heterogeneity creates uncertainty that can be exploited by entrepreneurs.

Indeed, scholars have increasingly identified how climate governance entrepreneurs have targeted many different venues of decision-making. Cities and states play an increasingly important role in climate governance, and several authors have argued that this is partly a result of entrepreneurship. For instance, Anderton and Setzer (2017) show that entrepreneurship played a key role when São Paulo and California developed stronger climate polices. Biedenkopf (2017) shows that entrepreneurial governors have been instrumental in the adoption of emissions trading in several US states. Maor (2017) and Mintrom and Luetjens (2017) show how entrepreneurial activities and strategies have resulted in transnational city climate networks.

Entrepreneurship may also play an important role in national climate policy development. For instance, Boasson (2015) and Hermansen (2015) explore how entrepreneurship has been key at certain moments in the development of Norwegian climate policy. Significant entrepreneurial activities have also influenced EU climate policy. Boasson and Wettestad (2013, 2014) find that entrepreneurship has been important for the EU’s policies on emissions trading, renewable energy and carbon capture and storage. Buhr (2012) shows that entrepreneurship was central for the inclusion of aviation in the EU’s emissions trading system. This literature indicates that institutional as well as structural entrepreneurship plays out at all levels. However, it is biased towards acts of entrepreneurship that seek to strengthen mitigation; it is less clear regarding how much counter-entrepreneurship (i.e. acts aimed at defending carbon-intensive practices and/or hindering the adoption and implementation of climate measures) we may see as the world moves towards more polycentric forms of climate governance.

While entrepreneurship can be a cause of polycentric development, it can also be understood as a consequence of weak monocentric steering (see also Chapter 9). Green (2014: 16) argues that weaknesses in the United Nations Framework Convention on Climate Change (UNFCCC) created a vacuum that allowed non-state, entrepreneurial actors to launch their own governance measures. If these experiments prove successful, they may be adopted by states. It is easier to initiate new policy ideas when no policy already exists than in a landscape crowded with other activities. In particular, scholars have highlighted entrepreneurship as an explanation for the upsurge in transnational governance (Green, 2014; see also Chapter 4). Andonova (2017) explores entrepreneurship in international public-private partnerships. Pattberg (2017) shows that the entrepreneurial activities will change during the lifetime of transnational governance initiatives, and specifies what activities we may expect in different phases. There is an emerging literature on the role entrepreneurship plays in international private governance; much less is known about its role in national, regional and local private and/or private-public initiatives.

We may expect that as a more polycentric governance pattern is established, entrepreneurship may contribute to strengthen it further. After all, policies tend to determine politics (Lowi, 1964, 1972). A range of historical institutional studies have taught us that once a path of development has been created, subsequent policy tends to continue along that path (Pierson, 2004; Streeck and Thelen, 2005). Accordingly, we may expect each of the many policies and measures adopted across scales and domains to develop along idiosyncratic paths, fostering multiple policy constituencies and decision-making venues. This will again create many opportunities for entrepreneurship, but it will become increasingly hard to know in advance which decision-making opportunities will be important. These multiple path dependencies may also contribute to hinder coherent and well-coordinated climate action (see in more detail later in this chapter).

In a monocentric regime, public decision-makers will seek to select one or a few of the best available instruments; the potentially important decision-making situations will be relatively few, and it will be relatively easy to differentiate important from unimportant decision-making opportunities. The competition for influence at these moments may, however, be very intense, so it may be harder for entrepreneurs (of all kinds) to succeed.

Second, the volume as well as the success of climate entrepreneurship is related to the existence of policy windows (e.g. Burh, 2012; Boasson and Wettestad, 2013, 2014; Hermansen 2015). This is probably the single most dominant contextual condition cited in the entrepreneurship literature. Kingdon (2011: 165) regarded a policy window as ‘an opportunity for advocates of proposals to push their pet solutions, or to push attention to their special problems’. He further stated that ‘a window opens because of change in the political stream (e.g. change in the administration, a shift in the partisan or ideological distribution of seats in Congress, or a shift in national mood); or it opens because a new problem captures the attention.’ A substantial number of subsequent studies have shown that open policy windows permit enhanced entrepreneurial activities and sometimes also entrepreneurial success (e.g. Corbett, 2005; Ugur and Yanjaya, 2008; Bakir, 2009; Zito, 2011).

In the following, I argue that polycentric climate governance will tend to entail the emergence of many climate policy windows, but not all windows will be utilised and thus contribute to the success of entrepreneurs. In more monocentric forms of governance, there will be fewer but more important policy windows that lend themselves to entrepreneurial exploitation. Climate policy research shows that open policy windows have made climate policy and governance entrepreneurs more successful than they would have been without such a window. For instance, Boasson and Wettestad (2013, 2014) identify an open climate policy window in the EU from about 2006 to 2009, created by the preparations for the 2009 UNFCCC Conference of the Parties (COP) in Copenhagen. Many actors in several different climate policy areas seized this opportunity. This had implications not only for EU policy but also for national policy in the EU; however, we lack systematic research on how this window influenced national policy development (for an exception, see Hermansen 2015). Moreover, Boasson and Wettestad (2014), as well as Hermansen (2015) and Buhr (2012), argue that policy windows are not merely a result of exogenous forces; entrepreneurs themselves seek to open windows and subsequently to keep them opened for as long as possible. Hermansen (2015: 933) argues that ‘[a] political wave comes from somewhere and involves some form of agency; it does not just appear out of the blue.’ Several authors have shown that institutional-cultural entrepreneurship and framing is key when it comes to the very creation of windows (Buhr, 2012; Boasson and Wettestad, 2013, 2014; Hermansen, 2015). Structural entrepreneurship can be important to prolong the period the window is open (Boasson and Wettestad, 2014).

Preparations for important UNFCCC COPs (such as COP15 in 2009 and COP21 in 2015) create more important domestic policy windows in some countries than in others, but we have little systematic and comparative research on this (but see Chapter 3). We also lack systematic knowledge about the relative importance of policy windows in private or private-public governance processes. Existing research indicates that such windows primarily strengthen the positions of actors that champion more and stronger climate polices. This may, however, result from a research bias, as there are far fewer studies that analyse actors who seek to obstruct climate policy initiatives (for an exception see Kibaroglu, Baskan and Alp, 2009).

There are good reasons to expect that the character and volume of potential policy windows will differ between polycentric and monocentric climate governance, and work on Chinese policy change processes (te Boekhorst et al., 2010) lends support to this notion. A centralised system will probably produce rather few, but potentially more important, policy windows. The fact that national climate policy adoptions tend to peak in the year or two before and after major global climate summits, such as those held in Rio de Janeiro (1992), Kyoto (1997) and Copenhagen (2009), indicates that intergovernmental summits help to create windows of opportunity that entrepreneurs can exploit (Townshend et al., 2013). However, it is important to acknowledge that a range of other factors may also have contributed to producing this pattern. The future regular ‘global stocktakes’ of the nationally determined contributions under the Paris Agreement may ensure that the global regime continues to open up policy windows. If the ratcheting-up logic works, then the five-year cycle of ‘pledge and review’ could create regular, global policy windows. Moreover, increasingly polycentric governance patterns will probably ensure that many more policy windows are opened across decision-making levels and domains, created by local and regional conditions, sector-specific conditions, summits held by non-state actors and so forth. Yet, it may be that these policy windows will be less dramatic and be open for shorter periods than the windows relating to major intergovernmental summits. Moreover, this development may also reduce the importance of UNFCCC COPs as events that create windows of opportunity.

In any event, it is important to acknowledge that not all actors will be able, or have the resources required, to understand that a window has opened, and thus not all windows will be exploited to the same extent. Mintrom and Norman (2009: 852) argue that entrepreneurs need to ‘display high levels of social acuity, or perceptiveness’ to exploit such windows. Such actors are not always around, and thus only some of the ensuing political potential will be tapped (Boasson, 2015). Moreover, polycentric governance creates a more murky political landscape that may make it harder for entrepreneurs to detect, trigger and influence policy windows. Hence, the growth in the number of potential policy windows under polycentric conditions may not necessarily translate into more successful climate policy entrepreneurship and hence more ambitious climate policies.

Third and last, coping with climate change is a true global challenge, and thus we need a certain degree of coordination in order to solve the issue effectively and efficiently. The polycentric and monocentric models of governance rely on different modes of cooperation. The polycentric approach highlights self-organisation or mutual adjustment, often resulting from mere interaction and learning (see Chapter 1). By contrast, coordination in the more monocentric approach relies on what Scott (2014: 59–64) terms regulative steering: hierarchically designed, formal requirements that prescribe how information is to be disseminated and compliance monitored. There are also likely to be coercive sanctions to address any shortfalls in compliance. I argue that while coordination in the monocentric approach relies on intergovernmental political agreement and the agreed system of enforcement, coordination in a polycentric governance system is more reliant on entrepreneurship.

Coordination will not be a task that gains much entrepreneurial attention in monocentric governance. Rather, this will primarily be ensured by top-down steering. The situation is likely to be radically different in polycentric governance. For coordination mechanisms to emerge in the first place, these will need to be initiated and developed by actors other than the intergovernmental regime. Some of the polycentric governance authors suggest that mutual adjustment is a key feature of polycentricity, but I do not a priori assume that this will occur (see Chapter 1). Rather, I expect climate governance entrepreneurs to primarily mobilise to influence development of rules and practices, and to a lesser extent engage to ensure adjustments of measures across levels and domains.

The pledge-and-review system introduced by the Paris Agreement combines polycentric and monocentric governance elements (see Chapter 2). It requires countries to regularly submit a nationally determined contribution, but it is largely up to the countries to set their own ambitions and choose their own reporting format. Thus, it is a relatively weak top-down steering mechanism, ‘creating a framework for making voluntary pledges that can be compared and reviewed internationally, in the hope that global ambition can be increased through a process of ‘naming and shaming’ (Falkner, 2016: 1107). Whether this will develop into a system that truly facilitates behavioural change depends on whether and how country representatives, business actors, international environmental organisations and so forth respond to it. Put differently: whether actors will engage in entrepreneurial ways to ensure a ‘race to the top’.

The radical increase in private carbon disclosure can be understood as an entrepreneurially induced attempt to increase climate information sharing, particularly amongst private actors (Maor, 2017; Pattberg, 2017). Carbon disclosure implies carbon reporting which denotes reporting of carbon emissions by companies, but also a broader societal purpose, increasingly understood as an instance of informational governance (Pattberg, 2017). Hence, mechanisms of transparency and accountability may eventually influence the behaviour of actors, leading to processes of mutual adjustment. Pattberg (2017) shows that while several carbon disclosure systems initially resulted from entrepreneurship, the activity has since become institutionalised. This indicates that coordination under polycentric governance can eventually be sustained by institutional-cultural social features, and is not completely reliant on entrepreneurship. It is, however, important to note that while disclosure may ensure that information is disseminated, actual behavioural change may not happen unless some actors use the information that is disclosed in an entrepreneurial way, for instance to nudge or pressure other actors to adjust their behaviour. Moreover, we have not (yet) witnessed such elaborate systems of carbon reporting from governmental units, such as municipalities, regions and countries (with the notable exception of the C40 reporting from cities). The pledge-and-review system under Paris may, however, trigger the emergence of more streamlined pledge-and-review procedures from a larger number of actors.

Finally, there is reason to expect that it will be challenging to ensure coordination in a polycentric system given the ‘let a thousand flowers bloom’ nature of bottom-up governance. Many initiatives can sometimes be good, but it may also hamper effectiveness and efficiency. There is indeed a danger that having too many cooks involved in polycentric climate governance can spoil the broth. That is to say, the more actors that have authority over an issue area, the harder it may be to ensure coordination (Gulick, 1937; Egeberg, 2003).

Against this backdrop, I assume that polycentric climate governance may entail emergence of entrepreneurially induced coordination, but that this will probably primarily ensure the dissemination of information and to a lesser extent ensure mutual adjustment of action. A reversal to more monocentric governance will reduce the entrepreneurial activities aimed at ensuring coordination.

Table 7.1 summarises the differences between the nature and volume of entrepreneurial activities under the two governance modes. We should expect entrepreneurship to be a more important driver of climate action in a polycentric than in a monocentric climate governance situation, but also that entrepreneurship will take on different roles depending on which form of governance dominates. However, entrepreneurship is a rather quixotic factor – one that is highly dependent on a range of other variables. As not all entrepreneurs will be interested in more ambitious climate rules and practices, more room for entrepreneurship also means more room for actors aiming to resist climate governance.

Table 7.1 Entrepreneurship in monocentric and polycentric governance

Governance approach

Elements of variation
Monocentric governancePolycentric governanceExpect polycentric governance to lead to …
Number of instrumentsFew measures adopted intergovernmentally and then implemented; pricing of greenhouse gas emissions key.Many. Technology-specific and sector-specific, voluntary as well as binding, economic as well as administrative.More, and more varied, entrepreneurship across levels of decision-making and societal domains, while a reversal towards more monocentric climate governance will reduce the volume and diversity of entrepreneurship.
Policy windowsWill emerge in relation to important climate summits: few, but very significant windows.May emerge in relation to the planned revisions of national pledges, but also relating to national, local and sector-specific conditions. Some major and many smaller windows.Emergence of many climate policy windows, but not all windows will be utilised and thus contribute to enhance the success of entrepreneurs. A reversal to more monocentric governance will create fewer, but more important policy windows that lend themselves more to entrepreneurial exploitation.
Mode of coordinationTop-down, hierarchical steering by coercion.Loose networks, information campaigns, naming and shaming.Emergence of some entrepreneurially induced coordination, but this will probably primarily ensure dissemination of information and to a lesser extent ensure mutual adjustment of action. A reversal to more monocentric governance will reduce the entrepreneurial activities aimed at ensuring coordination.
7.4 The Role of Entrepreneurship in Climate Governance Studies

Thus far, I have argued that we should expect to see systematic differences in the role and magnitude of entrepreneurship depending on the type of climate governance mode. However, it is important to keep in mind that entrepreneurship is only one piece of the climate governance puzzle. There are clear limitations of applying an entrepreneurship lens to the assessment of climate governance.

Few studies have examined how entrepreneurship will fare when challenging powerful segments or sectors in society. It is, however, not very daring to suggest that entrepreneurship will have a smaller chance of succeeding when challenging economically and/or politically powerful actors. Social scientists that only focus on entrepreneurship may easily overlook entrenched power relationships relating to economic as well as social and cultural sources of influence. Wilson (1989: 77) suggested that entrepreneurial action is key to ensuring environmental regulation, arguing that the cost of mitigating most environmental issues will be ‘heavily concentrated on some industry, profession, or locality and the benefits are spread over many if not all people’. He argued that the actors that experience costs relating to environmental action will mobilise all the political powers at their disposition to oppose these measures, while those in favour of a cleaner environment will tend to only overcome collective action dilemmas when they perform skilled entrepreneurship. Moreover, while such entrepreneurship can be very important in certain decision-making situations, it will often be challenging to create a long-lasting entrepreneurial counterweight to stronger social forces (Wilson, 1989: 80).

In addition to the economic interests highlighted by Wilson, several other factors may also counter the effect of entrepreneurship. Entrenched institutional-cultural features, for instance relating to energy use, modes of transportation (‘car culture’) or dietary habits (i.e. meat consumption), may thwart the adoption of stronger climate practices and governance. Moreover, public administrative units and businesses that have little to gain from climate mitigation often have superior formal authority and the ability to control information. For instance, a study of carbon capture and storage in the Norwegian petroleum industry shows that scientists, environmentalists and politicians succeeded only to a very limited degree, despite having applied a whole range of entrepreneurial strategies. The resistance from the structurally powerful petroleum segment was too strong (Boasson, 2015). This created a paradox: since it took more to succeed when the resistance was strong, entrepreneurs ended up being very active when they encountered strong opposition, while paying little attention to areas where the potential counterforces were much weaker. Thus, many opportunities remained unexploited.

Despite this bleak example, other parts of the climate entrepreneurship literature show that entrepreneurship can have long-lasting effects, and this gives us reason to be a bit more optimistic than Wilson (e.g. Boasson and Wettestad, 2013; Biedenkopf, 2017; Green, 2017; Pattberg, 2017). To understand the potential expansive effects of entrepreneurship, we need to combine the entrepreneurship approach with other social science frameworks and theories. Green (2017) argues: ‘Considering the expansive effects of entrepreneurship means looking beyond the specific goal or target of an individual entrepreneur. Rather, it examines the extent to which entrepreneurship influenced a larger set of actors than originally intended, or helped catalyze broader effects.’

Drawing on various social science literatures, Green highlights three types of expansive effects. First, demonstration effects, where entrepreneurs, perhaps through forms of experimentation, ensure that some climate action is tested. When an action has been proven to work, this will help make the measure more legitimate. Second, policy entrepreneurship might give rise to normative changes. For instance, we have seen that entrepreneurship related to carbon disclosure has contributed to a broader corporate norm of more transparent measurement and reporting. Third, entrepreneurship might have the expansive effect of changing governance practices, leading governments to align with or adopt practices initiated by entrepreneurs. It can be challenging to determine analytically when the effects of entrepreneurship end and other causal forces take over, but skilful combinations of different theories and frameworks can help us capture important expansive and long-term effects of entrepreneurship.

To gain a better understanding of the role of entrepreneurship under polycentric climate governance, we need more cumulative and comparative research. Hopefully, the increased interest we have seen in entrepreneurship in the area of climate governance will lead more scholars to base their research on similar understandings of this concept, enabling us to contrast how entrepreneurship may play out under different conditions and the short- as well as long-term effects of entrepreneurial activities.

7.5 Conclusions

Drawing on policy, governance and institutional entrepreneurship literatures, this chapter concludes that entrepreneurship should be understood as acts performed by actors who seek to ‘punch above their weight’. By contrast, actors who merely ‘do what is appropriate’ should not be considered entrepreneurial. Two different, more operational categories of entrepreneurship were identified: institutional-cultural entrepreneurship, understood as acts aimed at enhancing governance influence by altering distribution of authority and information; and structural entrepreneurship, understood as acts aimed at altering or diffusing norms and cognitive frameworks, worldviews or institutional logics.

This chapter has explored when – and to what extent – entrepreneurship plays out in conditions of polycentric and monocentric climate governance respectively. The upshot is that the role and importance of entrepreneurship will probably differ between polycentric governance and monocentric governance; entrepreneurship will probably be a more important driver of climate action in polycentric than in monocentric climate governance situations. We will also rely on entrepreneurship to ensure a broader range of tasks in the former than the latter governance mode. Moreover, entrepreneurship is a rather quixotic and unpredictable causal factor – whether entrepreneurship will be performed is not only a result of the prevailing mode of governance. It depends on the skills and experience of the persons involved, but other factors may be just as important, such as the distribution of economic and structural resources and prevalent institutional-cultural understandings. Ideally, research on climate governance entrepreneurship should combine this analytical lens with analytical frameworks that highlight other causal factors, such as path dependency, exogenous shocks, socialisation and diffusion.

There is no reason to expect that climate policy entrepreneurship will mushroom in all domains and offer a quick fix to the daunting climate governance challenge outlined in Chapter 1. Actors that aim to hamper climate governance may be just as empowered by more polycentric governance as actors that aim to induce ambitious measures. If we had been in a monocentric governance situation, we could have expected non-entrepreneurial factors, such as coercion, to produce climate governance irrespective of entrepreneurial activity. However, we are not in such a situation and it seems safe to conclude that strong monocentric climate governance will not emerge anytime soon. Hence, both researchers and practitioners should try to enhance their understanding of the promise and the limits of governance entrepreneurship.


1. Section 7.2 draws on Boasson (2015) and Boasson and Huitema (2017).

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8 Leadership and Pioneership Exploring Their Role in Polycentric Governance

Duncan Liefferink and Rüdiger K. W. Wurzel
8.1 Introduction

Leaders and pioneers are widely seen as agents of change. Such actors are of central importance for climate change mitigation and adaptation. We define pioneers as being ‘ahead of the troops or the pack’ while carrying out ‘activities which, depending on the circumstances and events “in the field”, may or may not help others to follow’ (Liefferink and Wurzel, 2017: 952–953). Leaders, on the other hand, have ‘the explicit aim of leading others, and, if necessary, to push others in a follower position’ (Liefferink and Wurzel, 2017: 953). In other words, leaders usually actively seek to attract followers (Burns, 1978, 2003; Helms, 2012; Torney 2015), while pioneers normally focus on domestic or internal activities without paying much attention to attracting followers, although they may unintentionally set an example for others.

The literature on leaders and pioneers in environmental and climate policy initially focused primarily on states (e.g. Young, 1991; Underdal, 1994; Andersen and Liefferink, 1997; Jänicke and Weidner, 1997). However, non-state actors have increasingly also been identified as capable of exhibiting climate leadership and pioneership (e.g. Wurzel and Liefferink, 2017). International climate change governance has traditionally been analysed as taking place within multilevel governance (MLG) structures, within which leaders and pioneers play a central role (e.g. Grubb and Gupta, 2000; Jordan et al., 2010; Wurzel and Connelly, 2011). However, especially since the adoption of the 2015 Paris Agreement, which largely abandoned the 1997 Kyoto Protocol’s top-down ‘targets-and-timetables’ approach in favour of a bottom-up approach with national pledges (i.e. nationally determined contributions; see Chapter 2), international climate governance appears to have become more polycentric (Jordan et al., 2015; Oberthür, 2016; see also Chapter 1). This chapter therefore assesses to what degree, if any, climate leaders and pioneers can play a central role not only within MLG structures but also under conditions of polycentric climate governance.

As we explain in more detail in what follows, under conditions of polycentricity, a potentially very large ‘universe’ of actors can in principle act as leaders or pioneers. According to Elinor Ostrom (2010: 552), ‘(p)olycentric systems are characterized by multiple governing authorities at different scales rather than a monocentric unit … Each unit within a polycentric system exercises considerable independence to make norms and rules within a specific domain.’ However, while polycentricity and monocentricity, which constitute opposite poles on the governance dimension, are useful heuristic analytical terms, they are rarely found (at least in their pure form) in the highly interdependent pluralistic liberal democratic states which are the main focus of this chapter. Whereas in MLG structures leaders or pioneers may be limited by hierarchical relations and restrictive rules, each ‘unit within a polycentric system’ (Ostrom, 2010: 552) can have its own leaders and pioneers. Pushed to its extreme, polycentricity potentially enables virtually any conceivable actor within a particular unit of governance to become a leader or pioneer. At the same time, polycentricity may limit the effect of leaders and pioneers to the relatively independent unit in which they function.

In this chapter, we first discuss the specific features of leadership and pioneership under conditions of polycentricity at a conceptual level. Drawing on the existing literature and a wide range of examples, we then offer a systematic assessment of various types of actors employing different types of leadership and pioneership in polycentric climate governance.

8.2 Polycentricity, Leadership and Pioneership

Polycentricity potentially offers seemingly endless opportunities for leadership and pioneership. At the same time, the relative autonomy of polycentric decision-making centres (e.g. Aligica and Tarko, 2012) may severely limit the range of possible followers. If we view ‘a family, a firm [or] a local government’ as a fairly independent unit within a polycentric system (Ostrom, 2010: 552), it cannot be automatically assumed that its activities attract followers from outside this unit. Hence, at first sight, pioneership seems more likely than leadership to occur under conditions of polycentricity. A closer look at two basic conceptual features of polycentricity and their links to MLG, which constitutes another widely used concept of multicentred decision-making, may provide a more nuanced picture (see also Chapter 1).

First, the concept of polycentricity is built on a functionalist logic. Vincent and Elinor Ostrom and their collaborators developed the idea of polycentricity around various specialised agencies providing specific public services (e.g. water supply or policing) in local governments in the United States (Ostrom, Tiebout and Warren, 1961). In Ostrom’s definition, polycentric units ‘exercise considerable independence … within a specific domain’ (Ostrom, 2010: 552; emphasis added) in which they perform specific functions or deliver specific services (Aligica and Tarko, 2012: 241).

Second, polycentricity is a multilevel phenomenon. According to Aligica and Tarko (2012: 241), the Ostroms ‘hammered the crucial fact that the optimal scale of production is not the same for all urban public goods and services’. Hence, ‘the existence of multiple agencies interacting and overlapping … is the result of the fact that different services require a different scale’ (Aligica and Tarko, 2012: 241). This insight can be linked to the normative principle of subsidiarity which states that decisions should be taken at the lowest possible level of governance. Subsidiarity also plays a role in the governance of federal and quasi-federal systems such as the European Union (EU) (see also Chapter 1).

The functional and scale-focused character of polycentricity resembles key features of MLG. This is especially the case for Hooghe and Marks’ (2003) analytical distinction between Type I and Type II MLG. Type I refers to nested, non-intersecting, general-purpose jurisdictions, i.e. the ‘systemic’ hierarchy of territorial units – municipalities, regions, states, international organisations – which is reflected in the formal governance structure of states as well as the EU. Type II refers to flexible, task-specific, overlapping jurisdictions and shows strong resemblance with polycentricity. Rayner and Jordan (2013: 75) even equate polycentricity with MLG when stating ‘polycentric or, in EU parlance, multilevel governance’.

Comparing polycentricity to MLG Type II helps to demonstrate that polycentricity and monocentricity are actually related and may be seen as ideal-typical opposite poles of the same analytical dimension. This insight can be traced to the writings of both MLG and polycentricity scholars. Hooghe and Marks (2003) have argued that the ‘systemic’ institutions of MLG Type I often help to provide the legal framework or the financial basis for functional Type II activities. In their view, ‘Type II governance is generally embedded in Type I governance’ (Hooghe and Marks, 2003: 238). Rayner and Jordan (2013: 77) note that polycentricity and monocentricity can be interconnected in various ways, as occurs, for instance, in the EU. This is also recognised by Aligica and Tarko (2012: 248), who point to the ‘unstable coexistence’ of polycentricity and monocentricity. They acknowledge that different polycentric systems may be laterally related (e.g. the market and the legal system) and that polycentric and monocentric systems may be nested, not least when it comes to the provision of shared, overarching rules which are essential for the functioning of a polycentric system (Aligica and Tarko, 2012: 255–256). Ostrom et al. (1961) also refer to central mechanisms to resolve conflicts under conditions of polycentricity. In addition, several inherent weaknesses of polycentric systems that are flagged up by Ostrom (2010, 2012), including the risk of fragmentation, inconsistent policies, coordination problems and free-riding, could arguably be countered by establishing links to MLG Type I arrangements. Thus, Ostrom (2010: 550) stresses that developing long-term solutions to complex problems (such as climate change) in fact requires both hierarchical and decentralised efforts. Homsy and Warner’s (2015) study of sustainability policies in approximately 1,500 municipalities across the United States goes further by arguing that municipalities working in an MLG framework supportive of local sustainability action perform better than others under polycentric governance conditions. This notably involves the provision of incentives, redistributive mechanisms, expertise and technical assistance, as well as a favourable general political atmosphere by the state (i.e. MLG Type I) government. Thus, while the ‘pure’ forms of polycentricity and monocentricity are useful heuristic devices, at least in pluralistic democratic states they tend to be found in mixed forms.

The discussion so far makes three things clear. First, polycentric leadership/pioneership is likely to take place primarily within relatively small, often functionally differentiated domains such as a water district, a school, a branch of industry or a product chain (Ostrom, 2010: 552). This implies that the ways in which leadership/pioneership can be exerted may differ depending on the relationships prevalent between actors within a particular functional context. In the next section, we explore in more detail the relevance of different types of leadership for different categories of actors in polycentric climate governance.

Second, the functional confines of polycentric leadership/pioneership may lead one to assume that the ambition and possible impact of polycentric leadership/pioneership are likely to remain limited to a small, functionally determined environment. This would strongly curtail the opportunities for attracting followers and thus put the focus on pioneership rather than leadership under conditions of polycentricity. However, the foregoing discussion suggested that polycentric systems actually maintain various relations with other (polycentric) systems outside their own relatively self-contained functional environment.

Third, the observation of polycentric (or MLG Type II arrangements) being embedded, at least in certain respects, in MLG Type I governance leaves open the possibility of some degree of leadership ‘from above’ (compare with Chapter 4, which argues that monocentric institutions remain important for safeguarding democratic control in systems with increasingly polycentric characteristics). For example, Homsy and Warner (2015) found that active US states exerted leadership vis-à-vis municipalities within their territories by providing incentives, expertise, etc. Within the context of the German energy transition, there is strong empirical evidence of the federal government’s key role in creating favourable conditions for local initiatives (Ehnert et al., 2016; Jänicke, 2017). The Chinese National Development and Reform Commission in 2010 initiated a project that encouraged five provinces and eight cities to undertake pilot projects in order to demonstrate the feasibility of low-carbon development plans and renewable energy in urban areas (Li, 2017: 264).

8.3 Types of Leadership and Pioneership in Polycentric Climate Governance

As stated earlier, the analytical concepts of leaders and pioneers which are rooted in the international relations and comparative politics literature were originally developed for states (Liefferink and Wurzel, 2017). The distinction between leaders and pioneers builds on the observation that states may have different internal and external ‘faces’, i.e. leaders and pioneers may foster internal and external ambitions to different degrees. We argue that this logic also applies to non-state actors in polycentric (and MLG) governance structures.

Table 8.1 shows the four ideal-typical positions that result from combining low versus high internal ambitions and low versus high external ambitions.

Table 8.1 Ambitions and positions of leaders and pioneers

External ‘face’Internal ‘face’
Low internal environmental ambitionsHigh internal environmental ambitions
Low external environmental ambitions(a) Laggard(b) Pioneer
High external environmental ambitions(c) Symbolic leader(d) Pusher
Source: Adapted from Liefferink and Wurzel (2017).

An actor pursuing high internal and low external ambitions (cell b) adopts demanding policies for internal (or domestic) reasons without explicitly trying to attract followers. Such an actor can be defined as a pioneer. Symbolic leaders (cell c) and pushers (cell d) both have high external ambitions and thus offer leadership. However, while symbolic leaders combine high external ambitions with low internal ambitions, pushers pursue both high external and internal ambitions. Finally, laggards exhibit low internal and external ambitions (cell a).

The distinction between the internal and the external ‘face’ of a state can easily be applied to other governmental actors such as regions, provinces, cities and agencies, which all have internal policies while also maintaining ‘external’ relations. Importantly, the distinction between internal and external ambitions also applies to non-state actors. Internal ambitions may refer to, for example, production methods of firms or farmers, to purchasing policies of non-governmental organisations (NGOs) or to consumption choices of individual citizens. External ambitions refer to their willingness to push or to set an example for other firms, consumers, etc. Consequently, the different positions set out in Table 8.1 can also be applied to non-state actors. An individual using public transport for environmental reasons without trying to convince others to abandon their cars may be characterised as a pioneer. The same applies to a citizen’s initiative producing wind energy primarily for their own use. Classic NGOs such as Friends of the Earth or Greenpeace, on the other hand, derive their very existence from high external ambitions. Their internal ‘face’ is less important, although in view of their credibility they are usually expected to act as pushers rather than symbolic leaders.

For market actors, Dupuis and Schweizer (2016) have pointed out that a firm with high internal ambitions logically also has a strong interest in realising these ambitions externally by keeping competitors at bay while profiling itself as the only actor of its kind in a particular market. In other words, such a firm wants to gain or maintain a competitive advantage or possibly even a monopoly position. In the early 2010s, the Dutch start-up Niaga developed a new method for producing a fully recyclable carpet using 90 per cent less energy than a product made following conventional production methods. As soon as the method was operational, some large carpet producers unsurprisingly attempted to acquire the exclusive right for applying the method (van der Steen, 2017). It would be difficult to imagine a firm spending money on ‘measures to protect the climate without attempting to reap the potential benefits in terms of image and influence over consumers’ (Dupuis and Schweizer, 2016: 5). From a company’s point of view, being a pioneer (as defined earlier, i.e. having only high internal ambitions) would constitute an unlikely form of altruistic behaviour, which is likely to be found only among not-for-profit organisations. What, as far as market actors are concerned, ‘truly distinguishes pushers from pioneers is their involvement in politics … Pushers’ external polic[ies] do not only target consumers, but they also lobby the state in order to enshrine their own norms and techniques of [greenhouse gas] reductions into formal legislation’ (Dupuis and Schweizer, 2016: 5).

Leaders and pioneers can have an impact on other actors in polycentric (and MLG) governance structures in many different ways. They can, for instance, exert pressure on potential followers, spread new ideas or scientific insights or just offer a good example for others to follow. They can thus help to spread or upscale innovations. To assess these roles in a more systematic manner, we put forward an analytical distinction of different types of leadership that builds in particular on Oran Young’s seminal work on leadership in international regime formation (Young, 1991; see also Wurzel and Connelly, 2011; Wurzel, Connelly and Liefferink, 2017a). We distinguish between the following four types of leadership: (1) structural leadership, related primarily to military and economic power; (2) entrepreneurial leadership, involving diplomatic, negotiating and bargaining skills; (3) cognitive leadership, relying on knowledge and expertise; and (4) exemplary leadership, i.e. intentionally or unintentionally acting as an example for others (cf. Liefferink and Wurzel, 2017).

8.3.1 Structural Leadership

In traditional international relations theory, structural leadership is foremost associated with military power which, however, is of little relevance to climate governance. Moreover, leadership and power are related but not identical. Actors in possession of (structural) power may not actually use it to exert (structural) leadership (Liefferink and Wurzel, 2017).

Economic power asymmetries are important in climate governance, including under polycentric conditions. For states, the size of the domestic market is an important source of structural power and can be used to exert structural leadership. Similarly, market share can facilitate leadership by firms. In Austria and Denmark, the conversion of the dominant supermarket chains to organic products was decisive for increasing the market share of organic food labels and their reputation in both countries (Hofer, 2000). Consumers have economic power too. Their individual purchasing power may be very limited, although changing consumption patterns are often important drivers for change in products. Whereas one local windmill project may constitute an example of pioneering, thousands are likely to lead to fundamental shifts in the functioning of the energy grid (van Vliet, Chappells and Shove, 2005). Popular trends that can nowadays be rapidly shared via social media offer large potential for grassroots leadership. Some well-orchestrated consumer boycotts have mobilised considerable economic (consumer) power. For instance, a boycott against Shell was one of the decisive factors which made the company abandon its plan to dump the disused Brent Spar oil platform at the bottom of the North Sea in the 1990s (Löfstedt and Renn, 1997).

Another form of structural power derives from an actor’s contribution to the problem at stake or what may be called its systemic relevance. For instance, China has a pivotal role in global climate mitigation policies simply because it is the world’s largest greenhouse gas emitter. The bilateral agreement between Presidents Xi Jinping and Barack Obama in November 2014 constituted a milestone in the run-up to the 2015 Paris Agreement, not least because China and the United States together account for approximately 40 per cent of global greenhouse gas emissions (Bang and Schreurs, 2017; Li, 2017). With the more climate-sceptic Trump administration installed in the United States, a global leadership opportunity falls to China almost by default (cf. Li, 2017; Mufson and Mooney, 2017). Systemic relevance may also provide structural power to business. Good examples are investor groups such as the Ceres Investor Network on Climate Risk (which represents more than 130 investors, mainly in North America, and $17 trillion in assets) (Ceres, 2017) or the Institutional Investors Group on Climate Change (which includes more than 130 institutional investors in Europe and nearly $15 trillion in assets) (IIGCC, 2017). In November 2016, ten large oil and gas companies associated with the Oil and Gas Climate Initiative pledged to invest $1 billion to help develop low-emission technologies (OGCI, 2017). Apart from the large sum of money involved and the economic power exerted by the participating multinational companies, this initiative represents 20 per cent of global oil and gas production and accounts for about 12 per cent of historical greenhouse gas emissions (Bach, 2016).

NGOs do not themselves wield much economic power. Instead, they derive structural power from their size and the support they receive from the general public. For NGOs representing hundreds of thousands or even millions of members, political legitimacy is a key factor for exerting leadership and/or pushing others (such as the EU, states and firms) to exert leadership. Forming alliances is a way for NGOs to increase further their legitimacy. A key example is Climate Action Network Europe, which claims to include more than 130 member organisations that represent approximately 44 million citizens in more than 30 countries (CAN Europe, 2017). Its structural power enables it to put substantial pressure on businesses or states by attracting considerable media attention (Wurzel, Connelly and Monaghan, 2017b).

It makes sense to also include under the heading of structural leadership the use of formal institutional power (Wurzel, Liefferink and Connelly, 2017c). This is relevant primarily for state actors (including agencies) with, for example, law-making and law-enforcing competences. Examples in an international context include voting rights in international institutions and the European Commission’s right to initiate and enforce EU law. These rights provide the Commission with a degree of structural power within a supranational governance context. Reflecting the complex MLG relations in the EU, Jänicke (2017: 126) offers an interesting case of ‘enforced leadership’ when the Commission rejected Germany’s second National Allocation Plan, which aimed to distribute emissions allowances among emitting installations in the country, as insufficiently demanding under the EU emissions trading scheme (ETS). By forcing the German government to stick to its ‘self-proclaimed’ pioneer role, the Commission exhibited structural leadership (Jänicke, 2017: 119).

But formal institutional powers also offer opportunities for non-state actors to exert structural leadership. Structures for consultation and participation in liberal democracies warrant societal interests a seat at the table in most phases of the policy cycle, although the range of interests granted this right and the extent of their formal and informal influence may vary greatly. The right of standing in court also constitutes a potentially powerful weapon. A fairly spectacular example is the court case which the NGO Urgenda started against the Dutch state in 2012 (see also Chapter 3). It was aimed at increasing the government’s efforts to reduce greenhouse gas emissions. In 2015, the District Court of The Hague decided largely in favour of Urgenda (Liefferink, Boezeman and de Coninck, 2017). The possibility to lodge formal complaints with the Commission against the incorrect implementation of EU law has empowered citizens and particularly environmental NGOs to ‘fight’ their own national governments (Jordan and Liefferink, 2004: 228). Interestingly, non-state actors may also themselves create formal institutions for exerting leadership. Examples include various international certification schemes (e.g. for sustainable forestry products or palm oil) set up by business partnerships and roundtables (Arts, 2006; Schouten and Glasbergen, 2011), as well as various national labelling schemes. By setting standards and procedures for participating in these schemes, businesses (in some cases in collaboration with the state) create their own framework for the inclusion of leaders and the exclusion of laggards.

8.3.2 Entrepreneurial Leadership

The main role of entrepreneurial leadership is to draw attention to the character and importance of the issues at stake, to propose innovative policy solutions and to broker compromises (Young 1991: 294). There is a certain degree of overlap between entrepreneurial and cognitive leadership (see later in this chapter). While the framing of issues and the development of innovative ideas is mainly a function of cognitive leadership, effectively setting or at least shaping the climate policy agenda and negotiating the adoption of particular solutions is a matter for entrepreneurial leadership. In practice, entrepreneurial and cognitive leadership are often utilised simultaneously as generating knowledge without efforts to disseminate it and to convince others of its relevance is not likely to be very effective (Young, 1991: 300–301; Liefferink and Wurzel, 2017). Nevertheless, there is a clear conceptual distinction between cognitive leadership, which is about the production of ‘intellectual capital or generative systems of thought’ (Young, 1991: 298), and entrepreneurial leadership, which is about diplomatic, negotiating and bargaining skills (Liefferink and Wurzel, 2017; Wurzel et al., 2017; see also Chapter 7, where entrepreneurship is defined somewhat differently).1

Entrepreneurial leadership capacities are in principle available to both state and non-state actors, although the ability to mobilise and employ them may vary between different types of actors. Especially large states usually have fairly significant diplomatic resources at their disposal for networking, alliance-building and negotiating compromises. Massive diplomatic efforts by France were instrumental for the successful outcome of the 2015 Paris climate change conference (Bocquillon and Evrard, 2017). Large firms have considerable resources for various forms of consultation and lobbying activities with states and international organisations such as the United Nations and supranational actors such as the EU.

Small and medium-sized enterprises, NGOs and subnational governments have limited staff and financial capacities and therefore have to restrict themselves to clearly defined and well-targeted entrepreneurial efforts. A good example is the court case which was brought by Urgenda against the Dutch government. Urgenda is a network organisation with no more than 15 staff members (Urgenda, 2017). By making optimal use of the opportunity structures offered by the Dutch legal system, Urgenda managed to have a significant impact on the national climate debate. Cities sometimes conduct significant ‘paradiplomatic’ activities (Keating, 1999), which consist primarily of entrepreneurial leadership efforts. They increasingly do so in the framework of vertical networks (e.g. networks of ‘green’ cities or climate cities) initiated and facilitated by national governments or the EU such as the Covenant of Mayors (Kern, 2016; see also Chapter 5).

8.3.3 Cognitive Leadership

Cognitive – or in Young’s terminology ‘intellectual’ – leadership ‘relies on the power of ideas’ (Young, 1991: 300). It usually ‘operates on a different time scale than the other types of leadership … [because] the process of injecting new intellectual capital into policy streams is generally a time-consuming one’ (Young, 1991: 298).

That cognitive leadership is indeed a long-term process is aptly illustrated by the case of climate change. Almost one century passed between the discovery of the greenhouse effect by Svante Arrhenius in 1896 and its emergence as one of the key issues on the global political agenda. It required the activities of generations of scientists and activists, culminating in the shared 2007 Nobel Peace Prize for the Intergovernmental Panel on Climate Change (IPCC) and former US vice president Al Gore.

The capacity to frame and/or reframe problems, interests and future perspectives is arguably the most important feature of cognitive leadership by NGOs (e.g. Wurzel et al., 2017b). Environmental NGOs have coined the term ‘hot air’ (Long and Lörinczi, 2009) and led the way in questioning the alleged sustainability of biofuels.

Scientists and experts are crucial for developing knowledge about the causes and effects of environmental problems as well as for possible solutions. Their knowledge can be used by NGOs, individuals (e.g. Al Gore) or policy-makers at various levels of climate governance. Scientists and experts can themselves also play an important role in the climate policy-making process. The IPCC, whose activities oscillate between science and politics, provides the key example (e.g. Hulme and Mahony, 2010). Epistemic communities, which consist of scientists and experts (Haas, 1990, 1992), as well as knowledge brokers (Litfin, 1994), have played leading roles in the creation of various environmental regimes. However, climate scientists and experts have come under attack by populist movements and politicians, for example in the 2016 US elections and in the 2015 Brexit referendum in the United Kingdom.

Apart from scientific knowledge, the importance of ‘experiential’ knowledge about ‘how policies actually work at the street level or company level, and how implementation problems can be solved effectively’ (Haverland and Liefferink, 2012: 184) should not be underestimated. Experiential knowledge can be powerful ammunition for firms, branch organisations or other stakeholders to push for certain solutions (e.g. certain policy instruments) over others. Practical evidence that a given policy approach works and demonstrable support among policy addressees provide output legitimacy.

8.3.4 Exemplary Leadership

Exemplary leadership consists of providing good examples for other actors. States may act as exemplary leaders in climate governance both intentionally or unintentionally. Intentional exemplary leadership is provided by leaders which act as pushers while pioneers usually exhibit merely unintentional exemplary leadership (see Table 8.1). The United Kingdom’s early adoption of a national ETS with the intention of influencing the EU ETS (Rayner and Jordan, 2017) offers a good example of intentional leadership, while Germany and Denmark’s initial steps towards domestic energy transitions constitute examples of unintentional exemplary leadership (Andersen and Nielsen, 2017; Jänicke, 2017; Wurzel et al., 2017c).

As discussed, intentional exemplary leadership may be problematic for firms as they may have sound commercial reasons for being the first (and possibly only) actor to introduce an innovative ‘green’ product in a particular market. As Dupuis and Schweizer (2016) have pointed out, only some corporate actors are ‘confident enough in the superiority of their abatement techniques or in their internal climate policy’ – and thus in their comparative advantage vis-à-vis competitors – to consider presenting themselves as examples for others. The activist company Fairphone explicitly adopted the ambition to demonstrate the feasibility of a more sustainable mobile phone. With its activist roots and the explicit goal to make its branch of industry more sustainable, Fairphone is arguably best described as a hybrid between a firm and an NGO, which shows that the once strict divide between business and environmental organisations has become permeable, at least to some degree (Biedenkopf, Bachus and Van Eynde, 2016).

Exemplary leadership plays a particularly important role in the world of ‘green’ cities. A wide variety of city networks facilitate the exchange of good examples and local ‘best practices’ (Kern, 2016). Cities which attempt to attract economic investment by branding themselves as ‘green’ (e.g. Andersson, 2016; Wurzel et al., 2016) may be confronted with the same dilemma as corporate actors. Increasingly, however, city networks are embedded in multilevel arrangements which are explicitly aimed at ‘spreading the word’. A key example is the Covenant of Mayors, which was set up by the European Commission in 2008. With its monitoring programmes, benchmarking exercises and collaborative initiatives, the Covenant of Mayors provides learning opportunities for more than 7,000 member cities (CoM, 2017). Competitions like the European Green Capital Award and the European Energy Award are geared towards showcasing exemplary leadership. With the possible exception of some very large or mega-cities, individual cities do not usually wield significant structural power and have little interest in actively pushing others with the help of cognitive or entrepreneurial efforts. By setting up the Covenant of Mayors and the European Green Capital Award, the EU provided entrepreneurial leadership in their place.

8.4 Conclusions

Leadership and pioneership can take many forms. This is the case in traditional top-down government systems, which are dominated by state actors, and even more so under conditions of polycentric governance, which encourage potentially any actor to become a leader or pioneer. This chapter has shown that a wide range of both state and non-state actors are capable of exerting leadership and pioneership. Importantly, the differentiation between different types of leadership and pioneership has allowed us to offer a more fine-grained analysis of the actions of leaders and pioneers in polycentric climate governance.

Large corporate actors usually have considerable economic power and experiential knowledge which can be mobilised to exert structural, cognitive and exemplary leadership. However, depending on their market position, corporate actors may be reluctant to use their leadership capabilities to push others to adopt and implement the same or similar policies and measures. Apart from the economic power of consumers, which is potentially very significant but difficult to organise due to collective action problems, the structural power of civil society actors is mostly limited to formal institutional power and, in the case of in particular large NGOs, legitimacy. Moreover, NGOs, scientists and experts are in a relatively strong position to exert cognitive leadership by framing and reframing problems and identifying cause–effect relationships and solutions. However, these actors can be challenged by, for example, populist movements and politicians, which reject their cognitive leadership. Cities (and by extension also other tiers of subnational government) finally have a large potential for exerting exemplary leadership.

All actors assessed in this chapter, moreover, are potentially capable of exerting entrepreneurial leadership. This may involve diplomatic and/or lobbying efforts, for which only some actors (e.g. especially large states, companies and business organisations) usually have sufficiently large capacities. Entrepreneurial leadership may, however, also entail relatively small-scale, well-targeted efforts, such as initiating a strategic lawsuit or sharing knowledge in a network of peers. Such entrepreneurial leadership opportunities allow actors of limited size and capacity to exert leadership far beyond the boundaries of their own polycentric unit.

Pioneers are especially able to exert exemplary and cognitive pioneership as well as structural and entrepreneurial pioneership. However, because pioneers do not intentionally seek to attract followers, they will exhibit these four different types of pioneership primarily internally (e.g. within their organisation) rather than externally (i.e. vis-à-vis other actors). However, powerful and/or highly innovative pioneers are likely to have a significant impact on other actors in polycentric climate governance, even if they do not intend to do so.

In this chapter, we assessed whether polycentricity might lead not only to a proliferation of leaders and pioneers, but also to narrowing down the range of their potential followers to only those actors which operate in the same relatively independent domain in which leadership or pioneership originates. We argued that in many cases, ‘systemic’ institutions are essential for widening the audience of polycentric leaders and pioneers to potential followers from outside their relatively small, functionally defined governance units. Relatively autonomous polycentric units maintain relations with other relatively autonomous polycentric governance units and are in turn embedded within larger international, supranational, national or subnational governance units. This makes it possible for both state and non-state actors – which function as leaders and pioneers – to attract followers from both within and outside relatively autonomous, functionally defined polycentric governance units. All types of leadership identified in this chapter are important in this regard. States and large firms can amplify the impact of structural leadership through international organisations and international markets. NGOs would be considerably less influential without overarching national and/or EU legal systems offering to them the opportunity to exert wide-ranging cognitive leadership. Without its formal role in the United Nations Framework Convention on Climate Change machinery, the IPCC would never have been as influential as a cognitive leader as it is nowadays. And without the Covenant of Mayors, the European Green Capital Award and the European Energy Award, individual ‘green’ cities would be less well able to act as exemplary leaders and have an impact on other cities across Europe. Importantly, it was the EU which created these institutions in the first place.

In sum, leadership and pioneership originating in polycentric (or MLG Type II) units cannot be understood without taking into account their embeddedness in more hierarchical, top-down (or MLG Type I) arrangements. What seems to be important is to achieve the ‘right’ balance between more polycentric (or bottom-up) governance arrangements and hierarchical (or top-down) elements in climate governance. Finding this balance has become even more important since the adoption of the 2015 Paris Agreement, which encourages bottom-up or polycentric climate governance approaches.


1. Chapter 7 conceives of entrepreneurship in terms of ‘acts performed to “punch above your weight”’ in a much broader sense, including for instance the creation and maintenance of networks or processes of framing; our conception of entrepreneurship relates to all four types of leadership discussed in this chapter.

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9 Diffusion An Outcome of and an Opportunity for Polycentric Activity?

Jale Tosun
9.1 Introduction

Climate change governance is in flux, and policy analysts have identified different sources of dynamism (Jordan and Huitema, 2014a, 2014b). Most importantly, recent research suggests that the national and subnational levels are much more dynamic sites of governing activity than is often thought, at least in comparison with the international regime, which has been described as gridlocked (Hoffmann, 2011: 16). These research findings have resulted in a better appreciation that climate governance has become much more multilevel and ‘polycentric’ (Jordan et al., 2015; see also Chapter 1).

Polycentricity is chiefly about the emergence of and interaction between multiple governing authorities at different scales, which are mostly or completely independent when making norms and rules within a specific domain (Ostrom, Tiebout and Warren, 1961; Ostrom and Ostrom, 1977; Ostrom, 2010). In line with this concept, we observe a growing number of climate governance initiatives operating at the local level through processes of self-organisation, with cities striving to shape climate governance not only at the local level but also at the transnational level (see Chapter 5). To attain this goal, cities have formed networks that are bound by a set of overarching rules and that are committed to experimentation and learning (e.g. Castán Broto and Bulkeley, 2013). City networks and other types of local action develop collaborations with other governing units at the subnational, national, transnational or international levels, involving both public and private actors. With the formation of such public-public and public-private partnerships (e.g. Bäckstrand, 2008), climate governance initiatives become more ambitious over time. These developments are described and discussed by various contributions to this volume and the broader literature on climate governance.

Recognising that climate governance has become increasingly polycentric (Jordan et al., 2015), two research questions are well worth posing. First, we can hardly expect that polycentricity emerged as a reaction to one specific event, but is it more likely to be the outcome of decisions taken by many different actors in response to a whole series of events over a longer period? An analytical concept that explicitly takes into account decision-making processes over time in different governing units is that of diffusion. Therefore, to what extent is the emergence of polycentric governance an outcome of a diffusion process?

Whilst one could reason that polycentric climate governance represents the outcome of a diffusion process, at the same time it can be asked to what extent greater polycentricity itself has facilitated diffusion (see also Chapter 7). One of the core propositions in polycentric governance theory (see Chapter 1) is that experimentation facilitates learning (see Chapter 6). Learning, however, also represents a core mechanism by which diffusion takes place. From this perspective, it is conceivable that polycentricity is related to diffusion processes in two ways: first, polycentricity could be the outcome of diffusion processes; and second, diffusion could be facilitated by the existence of polycentricity as an active opportunity structure. Consequently, the second research question that underlies this chapter is: to what extent does polycentric governance represents an opportunity for diffusion?

This chapter begins by giving an overview of the conceptual foundations of diffusion research, which involves both the diffusion of policies and institutions. Next, it discusses the extent to which polycentric climate governance is an outcome of diffusion processes, followed by an assessment of how polycentric governance can serve as an opportunity structure for further diffusion processes. With regard to the latter, the European Union (EU) is prominently discussed, as it has often been referred to as a leader in climate policy (see e.g. Oberthür and Roche Kelly, 2008). It closes with a summary of the main insights and suggestions for future research. While the focus of this chapter is on climate policy, the concluding section also discusses the applicability of diffusion research to other forms of governing.

9.2 Conceptual Foundations of Diffusion Research

A major research interest of policy studies has focused on the sources and patterns of policy change; that is, how policies, instruments or the calibration of instruments differ when examined at different points in time (Hall, 1993). At the policy level, for instance, policy change can entail the decision to adopt a legal act that establishes sustainable forest management. At the policy instrument level, policy change can refer to replacing regulatory instruments (e.g. maximum permissible levels of pollution) with market-based instruments (e.g. levies, taxes or subsidies). In terms of the third level (the calibration of specific instruments), replacing existing maximum permissible levels of pollution with stricter standards represents an instance of policy change (Tosun, 2013). To explain the occurrence and patterns of policy change, scholars have relied on a set of theories that stress the importance of the policy process; that is, who participates in policy-making, what interests the individual actors have and which coalitions they form (Weible and Sabatier, 2017). Among these theories is the analytical perspective offered by diffusion research (Meseguer and Gilardi, 2009; Gilardi, 2012; Berry and Berry, 2018).

The main interest of diffusion research lies in how policy innovations spread from one entity to another (Dobbin, Simmons and Garrett, 2007), leading to policy change in the adopting entity. While straightforward at first glance, the definition of a policy innovation raises questions about what exactly characterises a policy innovation. According to Walker (1969), policy innovation is about a national government adopting a new policy, while ‘new’ means that it is new to the jurisdiction in question. Consequently, an important difference exists between policy invention and policy innovation (Jordan and Huitema, 2014a, 2014b). The first refers to the process of developing an original policy idea, whereas the latter is about the spread of that policy idea.

Policy scholars have conducted extensive inquiries into policy innovation, which can inform and guide scholarship on polycentric climate governance. Despite the vast corpus of research, Berry and Berry (2018) argue that most studies are similar as they all elaborate on two sets of explanations for the adoption of a new policy by a government. The first set of explanations refers to political, economic or social characteristics internal to the jurisdiction that innovate. Political characteristics include the partisan composition of national governments; we know, for example, that green parties are more supportive of climate policy than other political parties (e.g. Biesenbender and Tosun, 2014). Institutional veto players must also be taken into account when explaining why policy innovations are taken up by some countries but not others (e.g. Fleig, Schmidt and Tosun, 2017). Economic characteristics refer to the economic strength of countries, as well as the industries that dominate their economies and the degree to which the countries are integrated with regional and international markets (e.g. Tosun, 2013). Regarding the social characteristics, the existence and strength of civil society groups, for instance, have been shown to matter for policies addressing climate, energy and environmental concerns (e.g. Tosun and Schulze, 2015).

The second set of explanations refers to factors that are external to the jurisdictions that innovate. The main explanation offered by this group of factors relates to diffusion, which is about national governments emulating the policy decisions previously taken by other governments. The drive behind emulation is the search for social acceptance by demonstrating conformity with the behaviour of other states (e.g. Meyer et al., 1997). While emulation represents the classic diffusion mechanism, several alternative mechanisms have been identified (e.g. Dobbin et al., 2007). These include learning, coercion and competitive pressure.

Learning – which is also an important feature of polycentric governance theory – is conceived as the process of changing preferences due to the availability of social knowledge. Put more directly, a government may adopt a policy in place elsewhere because it regards it as an appropriate solution to a given problem (Gilardi, 2012). Thus, instead of embarking on a costly search for appropriate solutions at the national level, governments can rely on the solutions adopted by other jurisdictions or international organisations. Such a scenario aligns with polycentric governance theory, in which local experiments lead to learning about what works and the upscaling of policy innovations.

The next mechanism is coercion, which can be defined as a situation in which policy choices of countries are constrained. Dobbin et al. (2007: 454–457) discuss coercion by referring to the concepts of conditionality, policy leadership and hegemonic ideas (see also Chapter 8). Powerful countries may require third states to adopt certain rules directly or indirectly by acting through international institutions (conditionality). In this context, Schneider and Urpelainen (2013: 14) argue that the United Nations, the Bretton Woods institutions, the General Agreement on Tariffs and Trade and the North Atlantic Treaty Organisation, among others, have been established and promoted by the United States in an effort to spread its liberal economic and political ideas. According to Gruber (2000), powerful states may influence decisions taken by weak ones even without an intention to do so (policy leadership). This is achieved by altering the nature of the status quo they face. The example given is the decision of the United States to pursue free trade with Canada, which stimulated the Mexican government to engage in free trade as well. Finally, hegemonic ideas are about the prevalence of certain policy notions. Powerful countries can influence the framing of policy discussions because they have a better research infrastructure (Dobbin et al., 2007: 456).

The third mechanism highlights the importance of economic competition in the diffusion of policy innovations. The logic underlying this mechanism is that the competition for trade and investment affects the incentives of policy-makers regarding whether to adopt policy prescriptions. Several empirical studies point out the relevance of economic competition for policy diffusion. The findings generally suggest that countries are inclined to adapt their standards to those of their key export markets (e.g. Prakash and Potoski, 2006).

The second point that needs further clarification concerns the patterns we can observe when policy innovations spread. Studies of policy diffusion often focus on the horizontal spread of policy innovations from one state to another (horizontal diffusion). An alternative diffusion pattern involves studying whether the adoption of policy innovations by subnational units makes national-level action more likely (vertical diffusion) (Shipan and Volden, 2006). The fact that diffusion research recognises both horizontal and vertical diffusion makes the diffusion perspective, in principle, compatible with polycentric governance and promises some valuable insights. However, in reality, the literatures on polycentric climate governance and policy diffusion do not speak to one another, which hampers the seizing of this opportunity for conceptual advancement.

Studies of policy diffusion are not only remarkably similar in that they all test a relatively stable set of explanatory factors (Berry and Berry, 2018), but they predominantly focus on one or a few specific policy instruments per analysis and adopt a relatively simple measurement that only gauges whether that specific instrument (e.g. carbon taxes) exists in the individual jurisdictions (Howlett and Rayner, 2008). This choice of measurement is often motivated by limitations in data availability and other challenges to measurement. In this context, Meseguer and Gilardi (2009) further note that existing studies tend to concentrate on instances of ‘explosive’ diffusion (i.e. the adoption of a policy innovation by numerous or all observation units at fast rates), which correspond to a selection bias and may potentially lead to overestimating the likelihood that policy diffusion takes place. The selection bias results from the fact that ‘explosive’ events are easier and possibly also more exciting to observe, which stems from two sources. First, such diffusion events are usually triggered by actors such as international organisations that offer empirical data on the characteristics of the policy innovation concerned and the corresponding diffusion patterns. Second, ‘explosive’ diffusion is rare compared to ‘regular’ diffusion, which makes it easy for researchers to identify these events themselves and make them the subject of analysis.

9.3 The Diffusion of Climate-related Policies and Institutions

A vibrant research landscape exists that examines the diffusion of climate-related policies and institutions. For example, studies by Dubash et al. (2013), Lachapelle and Paterson (2013) and Fankhauser, Gennaioli and Collins (2015, 2016) demonstrate the spread of policy tools designed to tackle climate change, which especially took place from the 1990s onwards. The climate policies that have diffused transnationally include regulation, taxes and subsidies (Hughes and Urpelainen, 2015; see also Chapter 3).

Regulation can target the mitigation of climate change as well as the adaptation to it. Mitigation policies predominantly include measures aiming to lower emissions of greenhouse gases, for example, by means of protecting natural carbon dioxide sinks such as forests and oceans, or creating new sinks through afforestation or reforestation (Fleig et al., 2017: 104). Adaptation policies are about developing responses to climate change impacts (see also Chapter 17) such as strategies for managing drought periods or flood management (Brouwer, Rayner and Huitema, 2013). Fleig et al. (2017) show that there is a basic interdependence between the adoption of mitigation and adaptation policies: governments that adopt mitigation policies are also more likely to adopt adaptation policies, and vice versa.

Carbon taxes are directly connected with the level of carbon dioxide emissions and put a price on the volume of these emissions with a view to creating an incentive for users to reduce their consumption of fossil-fuel energy sources. Carbon taxes typically apply to diffuse sources of carbon dioxide emissions such as the road transport, residential and commercial sectors. Finland was the first country to adopt an explicit carbon tax in 1990. The introduction of the carbon tax in Finland represented an ad hoc reaction to the international discourse on sustainable development and climate change (Vehmas, 2005). The other Nordic and European countries followed the Finnish example in the 1990s and also introduced some type of carbon tax (Daugbjerg and Pedersen, 2004).

Regarding subsidies, Schaffer and Bernauer (2014) concentrate on the diffusion of feed-in tariffs for renewable energy and the adoption of green certificate systems in advanced democracies over the past 20 years. Their empirical findings show that higher shares of fossil and nuclear energy increase the likelihood of a national government adopting these two policy instruments for promoting renewable energy. A climate policy innovation that has only recently started to diffuse is subsidies for electric cars, which was introduced in Norway in the 1990s (Holtsmark and Skonhoft, 2014). In 2009, China adopted a similar subsidy policy for electric cars, and Germany followed in 2016.

The literature has also addressed the diffusion of institutions. In this regard, one strand of the literature has examined the diffusion of ministries responsible for drafting climate policies. For example, Busch and Jörgens (2005) and Aklin and Urpelainen (2014) study the global spread of environmental ministries that tend to push for the adoption of national climate policies. Some countries such as Pakistan even created specific ministries for climate change, but such ministries have seen less diffusion. In most cases, climate change is a subdivision within either the environmental or energy ministry (see Tosun, 2018).

Research on climate policy and institutions has shown that climate policies in particular are prone to diffusion, since climate change requires coordinated action by many or ideally even all jurisdictions. The diffusion of climate policy innovation is driven by both external and internal factors. With regard to the external drivers, all four diffusion mechanisms (i.e. emulation, learning, coercion and competition) discussed earlier can be found in the relevant literature (e.g. Biesenbender and Tosun 2014). What is perhaps even more interesting is that internal considerations seem to matter as much as external drivers (e.g. Gilardi 2012). For example, Marcinkiewicz and Tosun (2015) show that lack of support for climate policies by political parties has hampered the adoption of innovations by the Polish government. Climate governance–related institutions are less well explored in the literature, especially those that specifically govern climate change. What we can observe is that many energy and/or environmental ministries have been reorganised to include a subdivision on climate change (e.g. Bauer et al., 2012).

9.4 Polycentric Climate Governance as an Outcome of Diffusion

Through its annual Conference of the Parties (COP), parties to the 1992 United Nations Framework Convention on Climate Change (UNFCCC) meet regularly to negotiate collective climate actions and to monitor progress made by their implementation. A milestone in the development of the international climate regime was the adoption of the Kyoto Protocol in 1997 (see Chapter 2). As highlighted by Oberthür and Tänzler (2007), the adoption of the Protocol represented an important stimulus for the diffusion of climate policies. Initially, the UNFCCC aimed to reach agreement on climate policies at the international level, ideally involving all state parties. However, it quickly became apparent that the international community lacked the willingness to agree on a set of harmonised measures to protect the climate.

The failure to agree on binding commitments at the international level can be considered one of the reasons for the EU’s climate leadership aspirations (Wettestad and Boasson, 2013). This first became visible in the negotiations of the Kyoto Protocol when the EU proposed the most ambitious emission cuts among the major industrialised countries (Oberthür and Roche Kelly, 2008: 36). Another important symptom of the EU’s leadership in global climate governance was the adoption of its emissions trading system in 2003, which set limits on the carbon dioxide emissions that large polluting installations can emit, together accounting for about 40 per cent of the EU’s total carbon dioxide emissions.

The EU’s push to become an international climate leader has resulted in two important processes. First, within the EU a diffusion process has started, which in some cases (e.g. the promotion of renewable energy) has resulted in the adoption of harmonised policy measures, whereas in other cases the policy innovations have been adopted by only some EU member states (e.g. carbon taxes). The diffusion of climate policies within the EU has helped to establish the EU as a domain in which polycentric climate governance takes place.

Second, the EU has tried – and to some extent succeeded – to diffuse its climate policies beyond its own jurisdiction, which has resulted in forming another level at which polycentric climate governance occurs. A case in point is the Energy Community, which is an international organisation that brings together the EU and its neighbours to create an integrated pan-European energy market by extending the EU’s energy policies to countries in South-East Europe, the Black Sea region and beyond. The energy policies it has diffused include measures to increase the security of supply as well as measures that aim to decarbonise energy systems and reduce carbon dioxide emissions (e.g. Tosun and Schulze, 2015). As a result, the EU cooperates with the member states of the Energy Community on climate governance. The Energy Community members introduce new ideas to the EU and help to diffuse EU policies further to regions such as Central Asia.

The Energy Community is not the only means by which climate-related policies have diffused beyond the EU and have contributed to the emergence of a new governance domain. When the German government proposed the idea of forming a Renewables Club in 2013, the governments of China, India, Morocco, South Africa, Tonga and the United Arab Emirates as non-EU members declared their interest in joining (Hovi et al., 2016). In the case of China, India and South Africa, the decision to join the Renewables Club can be ascribed to their recognition of the EU’s market power and the potential risk to their economic development stemming from carbon-dioxide-intense industrialisation. Before joining the Renewables Club, these three countries had already adopted climate policies that were similar to those in place within EU member states (Dubash et al., 2013).

Diffusion is also the main driving force behind the development of subnational networks that become important venues of climate governance. Examining the motivations of Spanish cities and municipalities to join the Covenant of Mayors, Pablo-Romero, Sánchez Braza and González Limón (2015) show that an important driving force is the membership of neighbouring municipalities, which supports the very basic logic of diffusion (through emulation and/or learning). Conversely, the more cities and municipalities join subnational networks such as the Covenant of Mayors, the more relevant they become as domains of polycentric governance.

Altogether, the literature supports the view that diffusion processes (rather than other processes such as a deliberate creation of this system in a top-down fashion through international organisations) have led to the emergence of polycentric climate governance as it can be observed today. The starting point for this was frustration with a gridlocked international regime. Influential actors such as the EU have helped fill this void and have sought to spread climate policies by employing different diffusion mechanisms. As discussed, the EU is not the only venue that has formed as an outcome of diffusion processes: we can observe very different venues, all of which emerged as a response to diffusion processes. The examples discussed concentrated on the transnational, national and subnational levels. However, it should be noted that the creation of the International Renewable Energy Agency was also preceded by diffusion processes related to the promotion of renewable energy (see Schaffer and Bernauer, 2014). From this, it follows that diffusion can help to establish institutional forums at all governance levels.

9.5 Polycentric Climate Governance as an Opportunity for Diffusion

Polycentric climate governance is about the emergence of an institutional system, which is theorised to lead to more efficient policy outcomes (Ostrom, 2010: 550). This section presumes that such efficient policy outcomes can come about by means of diffusion processes that are facilitated by the multitude of governing authorities at different scales. Policy diffusion entails an efficiency gain since national governments are spared the costs stemming from gathering information about what works to solve a policy problem.

As discussed in the previous section, the EU has sought to claim leadership in global climate governance. Did the EU’s leadership aspirations result in the spreading of climate policies that otherwise would not have happened? Evidence exists within the literature demonstrating that the EU has succeeded in bringing about several developments with regard to climate policy. A well-documented example is Russia’s ratification of the Kyoto Protocol. The primary reason for inducing the country to ratify the Protocol – and to trigger a process of formulating national policies to attain the carbon dioxide reduction goals – was pressure imposed on the Russian government by European leaders. The EU representatives maintained that they would only support Russia’s membership in the World Trade Organization if the government ratified the Kyoto Protocol (Henry and Sundstrom, 2007). The polycentric climate governance regime and the role the EU claims for itself therein gave the EU the coercive power to change the Russian government’s stand on climate policy and to exercise international leadership. Put more generally, polycentric governance can potentially allow for international leadership that can attract followers. In the aftermath of ratifying the Kyoto Protocol, the Russian government has also adopted policies to promote the production of renewable energy (see Zhang et al., 2011). While Russia cannot be regarded as a frontrunner in promoting renewable energy, the country has joined the International Renewable Energy Agency (see Van de Graaf, 2013) and has supported corresponding policies at different instances at the international level, such as the Group of 8 (G8) Summit held in Saint Petersburg in 2006.

The literature suggests that the EU is most likely to facilitate the diffusion of climate policy innovations when it speaks with one voice or when it has adopted a harmonised policy that can help guide non-EU countries when deciding on whether to adopt a climate policy innovation. For example, carbon taxes have been subject to a slow diffusion process, despite the fact that they have been in place in some countries (e.g. Finland) since 1990 (see Busch and Jörgens, 2005; Baranzini and Carattini, 2014). One explanation for this observation is that the EU has not adopted a common stance on carbon taxes. Instead, the (limited) diffusion of carbon taxes can be attributed to the international image and economic importance of individual EU member states.

An important takeaway message from this example is that the mere existence of governing authorities at different levels is not a sufficient condition for diffusion processes to take place. Another point worth making is that diffusion processes – even if they take place in the EU context – do not have to result in the upscaling of policy innovations. In the case of carbon taxes, horizontal diffusion took place to a limited degree (see Andersen and Elkins, 2009), but this policy innovation failed to become the subject of vertical diffusion.

Policy measures adopted to promote the electric car in Germany offer an example of the successful vertical diffusion of a policy innovation in a polycentric system. German cities and municipalities have been experimenting with electric cars for a couple of years and communicated the lessons they drew with means of Germany-wide and transnational city networks. In 2016, the German Federal Council (Bundesrat), composed of the governments of the German states (Länder), adopted a resolution in which they demanded that from 2030 onwards cars that do not produce carbon dioxide emissions are to be authorised for road traffic, which can effectively be attained only by replacing fuel-powered cars by electric ones. This resolution appears even more extraordinary when considering that Germany has a very powerful car industry that has in the past been spared from policy measures that would have imposed regulatory burdens on it (e.g. Tosun, 2017). When comparing the transition for electric mobility in Germany and the United Kingdom, for instance, it becomes apparent that the German government pursues a ‘careful transformation and conservation of its automotive industry’ (Mazur et al., 2015: 84), which mostly consists of support for research and development for major German-based car manufacturers and suppliers. In the same year, the German federal government decided to put in place a financial incentive for buying electric cars.

In their resolution, the members of the Federal Council called on the European Commission to adopt a new policy approach that would support cars that do not produce carbon dioxide emissions (Khan, 2016). Whether the European Commission will act upon this call remains an open question, but what is important is that a climate policy innovation has diffused vertically from the local level to the regional and then national level, and may eventually even reach the European level. Yet there is an indicator that the topic of electric cars has entered the agenda of the European Commission: the draft proposal for the Energy Performance in Buildings Directive calls for a fixed share of parking spaces in all new buildings in the EU to be equipped with electric car recharging facilities. The EU’s policy agenda has also been influenced by discussions taking place in other venues of the polycentric climate governance system. In this case, the EU has formed a partnership with China (EU-China Urban Partnership) that brings together not only political and administrative elites, but also representatives of business and industry. One of the areas of collaboration of this transnational public-private partnership concerns electric mobility. Therefore, the EU’s policy approach to electric mobility is also determined by its embeddedness in transnational networks, which may facilitate policy diffusion through learning.

A variable that appears particularly important here is how well the policy innovation in question works in the jurisdiction from which it originates and/or in the other jurisdictions that adopted it. With regard to that question, the case of Germany is problematic since motorists seem unwilling to buy electric cars, at least at this point in time. Among the factors preventing German motorists from buying an electric car are cost considerations (e.g. Barth, Jugert and Fritsche, 2016). Thus, though political actors support the promotion of electric cars, the demand for them has been limited until recently (e.g. Meckling and Nahm, 2017). However, with political actors at different governing levels in Germany all adopting the same stance on electric cars, it is conceivable that the public will eventually become supportive of them, replacing fuel-powered cars with electric ones.

What the example of electric mobility in Germany shows is that polycentric governance can facilitate upscaling in some circumstances, but that it is likely to develop over long periods of time. A necessary precondition for vertical diffusion is horizontal diffusion, which is accelerated by the existence of polycentric governance. Then, vertical diffusion relies on the convergence of policy preferences across the different governing units, which may or may not be attained. Finally, it should be noted that upscaling does not necessarily mean that the policy innovation adopted by the upper governing units is identical to the policy innovation as it has emerged and diffused (horizontally) among the lower governing units. As exemplified by the EU’s draft directive, the reduction of carbon dioxide emissions by means of promoting electric cars can be pursued by targeting the installation of recharging facilities, but the initial idea for this measure could have come from a national policy that aims to foster the purchase of electric cars (e.g. financial incentives adopted by the German government).

Another facet of the relationship between diffusion and polycentric governance is that the latter can accelerate diffusion processes (Busch and Jörgens, 2005). Diffusion studies are interested in both the patterns and the time it takes for a given policy innovation to diffuse. From that perspective, the timing of a diffusion process could be explained by the development of a system of polycentric governance and the multiplication of domains in which communication, cooperation and learning takes place.

This argument is based on the reasoning that polycentric governance empowers different governing units and therefore motivates them to write their own success stories. From this, it follows that lower-level governing units in countries that are not known to be climate policy pioneers may take advantage of the new opportunity structure and adopt policy innovations that are not feasible at the higher governing levels. A prominent example is the case of California and the strict air pollution standards in place there (Tosun, 2013). The state is keen to maintain, tighten and export these standards. To this end, the government of California has drafted a global pact to reduce carbon dioxide emissions, which it seeks to get signed by a broad alliance of countries, including Canada, China and Mexico (Davenport and Nagourney, 2017). With California striving to act as a pace-setter in global climate politics (Bang, Victor and Andresen, 2017), the slow diffusion of climate policies at the international level may receive a stimulus and lead to better results.

9.6 Conclusions

This chapter has attempted to trigger a debate about the linkages between two different bodies of literature that have been discussed in isolation so far: one on diffusion and the other on polycentric governance. Diffusion research has been used to study how climate change policies come about (e.g. Fleig et al., 2017), but in doing so, this literature has not paid attention to the existence of polycentric governance and has also not reasoned to what extent – if any – its existence may affect the patterns of diffusion processes. Likewise, the small but growing literature on polycentric climate governance tends to describe the empirical characteristics of the emerging system and, insofar as it explains the empirical phenomena observed, tends to emphasise the effectiveness of policy learning and the role of policy entrepreneurs (e.g. Jordan et al., 2015). The current literature does not explain how domains of polycentric climate governance emerge and how innovations in one domain diffuse to others, which is, however, addressed by the research on policy diffusion. Despite the seemingly different interests of these two strands of research, it is analytically possible and – as argued here – rewarding to abstract from the research perspectives adopted in the respective literatures and attempt to synthesise them.

This chapter argues that polycentric governance is an outcome of diffusion processes and that it offers an opportunity structure for climate policy diffusion. The international climate governance system is polycentric as it involves multiple scales, mechanisms and actors. This structure is the outcome of multiple and simultaneous diffusion processes. While polycentric climate governance can be seen as an outcome of diffusion processes, it also offers an opportunity structure for the subsequent diffusion of particular initiatives by means of different diffusion mechanisms, which include but are not limited to learning. These diffusion processes are sometimes supported and sometimes hindered by domestic characteristics such as the nature of national political systems, the economy and society (e.g. Fankhauser et al., 2015, 2016).

The Paris Agreement introduced a global climate governance system that rests on the individual states offering nationally determined contributions (NDCs) (see Tobin et al., 2018). As the NDCs are subject to a five-year evaluation cycle in which every country needs to submit its efforts regarding climate change (see Chapters 2 and 12), it is likely that diffusion processes will continue to take place at different governance levels. The regular evaluation of the NDCs can result in both horizontal and vertical diffusion, which can potentially lead to a coherent climate regime at the international level. It could also lead to the preservation of the current regime, which is characterised by polycentricity. The assessment of the consequences of diffusion processes for polycentric climate governance is something that future research should address.

With the polycentric regime as it has emerged, horizontal diffusion can take place between cities, regions and nation states. While vertical diffusion in both directions – that is, downscaling and upscaling – is feasible, existing research on climate experiments and the role of learning processes suggests that in the future upscaling is the more likely outcome (e.g. Hoffmann, 2011). However, it is up to future research to validate this expectation.

More importantly and in line with the concept of polycentric governance, policy learning appears to be the diffusion mechanism that is preferred by political actors and that is also most likely to produce an upscaling of policy innovations. At the climate conference in Marrakech in November 2016, countries discussed the setting up of new initiatives such as the NDC Partnership, with a view towards supporting the formulation and implementation of NDCs in developing countries by means of facilitating policy learning (Fleig et al., 2017).

Considering that the Paris Agreement acknowledges both mitigation and adaptation policies, a consequence to be expected is that diffusion processes can be observed for both types of climate policy. The question that results from this perspective, then, is whether diffusion is more successful (i.e. more countries adopt policy innovations) in the case of mitigation or adaptation. At any rate, it appears analytically worthwhile to include both mitigation and adaptation policies in the study of diffusion in polycentric climate regimes – an aspect that was not addressed by Ostrom (2010). It is plausible to hypothesise that the upscaling of adaptation policies is most likely to occur in cities and subnational units as they have more experience with this type of policy, whereas we could expect mitigation policies to be subject to downscaling. Regarding the latter, it is possible that mitigation policies that have trickled down to lower governance levels become modified and then become the subject of a new horizontal and/or vertical diffusion process. However, again this expectation warrants a systematic analysis by future research.

In short, plenty of promising and relevant research questions related to the theme of this chapter remain unanswered, which should stimulate theoretically grounded empirical research on a wide range of governance units in developed and developing countries.

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10 Linkages Understanding Their Role in Polycentric Governance

Philipp Pattberg , Sander Chan , Lisa Sanderink and Oscar Widerberg *
10.1 Introduction

Global climate governance has developed from a classic international regime (based on the interests and decision-making of states) to a polycentric system (see Chapters 1 and 2), encompassing a wide range of non-state and subnational actors. Polycentric governance theory assumes that while governing initiatives are largely independent in establishing their own norms and rules via self-organisation, they are able to mutually adjust and collaborate with each other. Polycentric governance, in other words, highlights a non-hierarchic, layered landscape in which initiatives are linked rather than isolated. However, the exact nature of linkages has not been a major puzzle in polycentric governance theory to date. To close this gap, we explicitly discuss linkages between and among state, non-state and subnational actions in the polycentric climate governance system.

From a research perspective, ‘linkages’ is a broad and diverse concept. Linkages can be material, functional, biophysical or a ‘fact of life’ (van Asselt, Gupta and Biermann, 2005). For instance, climate change has an impact on biodiversity and poverty levels in countries lacking adaptive capacity. We focus, however, on institutional linkages that occur directly or indirectly, intentionally or unintentionally, among climate actions. Cities, for instance, collaborate and compete with other cities for resources; they are also dependent on the actions by the regions and countries in which they are located, the companies and industries driving their economies and their citizens (see Chapter 5).

From a policy perspective, coordinating and improving linkages between actors and institutions has started to gain traction. The 2015 Paris Agreement under the United Nations Framework Convention on Climate Change (UNFCCC) could be seen as marking a decisive shift towards more polycentric climate governance, increasingly trying to harness the potential benefits of linkages, while at the same time attempting to minimise the risk of conflict and overlap (see Chapter 2). The system of nationally determined contributions offers opportunities for new collaborations between public and private actors, and for strengthening existing linkages. The outcomes of the Paris climate summit gave unprecedented recognition to non-state actors (or, in UNFCCC jargon, ‘non-party stakeholders’) and cooperative initiatives in delivering climate action (see Chapter 4).

Against this background, we analyse linkages between state, non-state and subnational climate actions in the context of an emerging polycentric climate governance architecture. We begin by observing that the emerging polycentric climate system constitutes a networked structure, wherein individual actors interact with each other. To better assess the nature, quality and impacts of these interactions, we offer a discussion of previous conceptualisations of institutional linkages showing how climate actions by a myriad of cities, regions, companies and civil society organisations are connected. We then provide several illustrative examples for the main categories of linkages, focusing on interactions between transnational and international organisations. We then discuss the current and prospective approaches to ensure that climate actions interact synergistically with the intergovernmental UNFCCC regime and how synergistic interactions can be improved. Finally, we reflect on the core propositions of polycentric governance theory to assess its usefulness in analysing the current landscape of climate governance.

10.2 Polycentric Climate Governance as Networked Governance

Polycentric governance systems (including the global climate governance architecture) are characterised by multiple institutions organised in a non-hierarchical, top-down fashion. In the words of Ostrom (2010: 552), polycentric governance is characterised by

multiple governing authorities at different scales rather than a mono-centric unit. Each unit … exercises considerable independence to make norms and rules within a specific domain (such as a family, a firm, a local government, a network of local governments, a state or province, a region, a national government, or an international regime).

In this section, we review the evidence for the presence of a polycentric climate governance system by applying a network analysis to the plethora of regional, subnational, private and transnational climate actions currently making up the global climate governance architecture (see Biermann et al., 2009). Our argument is that climate actions are well connected and that, therefore, scholarly attention should focus on the linkages and interactions between governance initiatives.

The growth in the variety and number of actors and institutions in global climate governance is well documented. For instance, the Climate Initiatives Portal, a platform providing information on transnational climate initiatives administered by the United Nations Environment Programme (UNEP), contains more than 220 initiatives engaging state and non-state actors across eight thematic issue areas (e.g. transport, energy efficiency and adaptation; see Widerberg and Stripple, 2016). Michonski and Levi (2010: 1) identify more than 16 international organisations in the United Nations (UN) system that are part of the ‘broader complex of multilateral institutions whose rules, decisions, and activities can be expected to have important consequences for international efforts to confront climate change’. Similarly, Weischer, Morgan and Patel (2012: 177) study 17 ‘climate clubs’ that ‘includes any grouping that comprises more than two and less than the full multilateral set of countries party to the UNFCCC and that has not reached the degree of institutionalization of an international organization’ (see also Chapter 19). From a polycentric perspective, it may be tempting to see this emerging system of governance units as consisting of relatively independent centres of authority. However, the degree of polycentricity of the system can be determined only by establishing how interdependent each governance unit is vis-à-vis other units.

Climate governance institutions are not necessarily independent governing centres. Keohane and Victor (2011) even argue that there may be tight coupling or regional hierarchies and clusters between some institutions. Green (2013) shows this empirically by mapping how 30 different private transnational carbon accounting standards recognise other standards, such as those used by the Kyoto Protocol’s Clean Development Mechanism (CDM) or the European Union emissions trading system. Her analysis suggests that there is policy convergence in that public rules provide an ‘anchor’ for private rules to operate (Green, 2013). Hence, while the polycentric system of global climate governance appears to be increasingly populated by a myriad of new institutions and rule systems, Green shows how self-organisation around a limited set of common rules makes the system less fragmented than it seems at first glance. It is thus questionable whether in a counterfactual situation, without the Kyoto Protocol, there would have been a comparable surge in private carbon accounting schemes. This contradicts some of the core thinking in polycentric theory, namely that systems do not necessarily require a central coordinating force or agent to create order (Dorsch and Flachsland, 2017). It also begs another question: when can a system be considered polycentric, i.e. consisting of multiple centres of authority that are to some degree independent (taking into account that polycentricity is not, as noted in Chapter 1, a binary variable but should be understood as a continuum)? To answer this question, one has to understand the number and intensity of linkages between different governance units.

Green’s analysis includes three key conceptual and analytical aspects that enable her to study institutional linkages in a manner that resonates with polycentric theory. First, she conceptualises the system as a network consisting of nodes and links, following a growing trend among international relations scholars that characterise global governance in terms of networks (e.g. Hafner-Burton, Kahler and Montgomery, 2009; Kahler, 2015). This perspective understands the world as consisting ‘not of states but of networks’, and problems (and their solutions) arise because of too many or too few connections (Slaughter, 2017). Second, Green analyses linkages at the system level rather than at the dyadic level. Whereas traditional perspectives on institutional interplay and interactions (see later in this chapter) studied the linkages between a ‘source’ and a ‘target’ institution, Green’s network perspective allows her to look at linkages between three or more institutions. Third, she uses network analysis to approach her subject. Network analysis has become increasingly popular over the past 15 years through scientific breakthroughs in disciplines such as mathematics, physics and biology (Barabási, 2015). Network science suggests that widely different networks tend to share common properties. For instance, cascading events – when an initial change in one node has knock-on effects on neighbourhood nodes leading to large-scale effects – have been observed on the Internet, the financial system and human bodies (Barabási, 2015). Moreover, network analysis also allows for identifying central nodes in the network, revealing where power and authority may be situated.

Moving towards an empirical mapping of linkages in global climate governance requires the analyst to choose what type of linkages to focus on. One attempt has been presented by Widerberg (2016), who focuses on the ‘interaction structure’ created by joint membership of actors in institutional arrangements. This approach suggests that if two institutions share a member (i.e. an organisation), then knowledge, ideas, information and norms can more easily travel between the institutions. Members become ‘bridges’ between different institutions, acting as mediators or gatekeepers for linkages. Members also function as forces of convergence as they try to streamline rule systems for reasons of efficiency. For example, if a city is part of two different urban climate governance networks, it has an incentive to ensure that mitigation goals and monitoring and reporting standards are the same or at least do not contradict each other. Hence, mapping how institutions are linked by membership provides valuable insights into the processes of convergence and divergence in the polycentric climate governance system.

Using data collected by Widerberg, Pattberg and Kristensen (2016), we create a network diagram of 77 international and transnational, public, private and hybrid institutions. Each node in the network represents a climate action, and each link represents a shared participant (i.e. organisational member). For instance, if Sweden participates in both the UNFCCC and the Renewable Energy and Energy Efficiency Partnership, a link is created between the two institutions. Figure 10.1 shows the resulting figure, with the UNFCCC clearly marked.

Figure 10.1 Network visualisation of 77 institutions in global climate governance.

Source: Widerberg (2016).

Visualising the global climate governance landscape as a network shows how well connected the institutions are in terms of shared membership. It also shows how the UNFCCC is one of many institutions but that it remains centrally positioned vis-à-vis the others. If one assumes that shared membership increases the likelihood of interaction between institutions in terms of the exchange and flow of knowledge, ideas, information and norms, then it provides a starting point for delving deeper into what exactly travels through the network and in what direction. The next section discusses various approaches to conceptualise the linkages of institutions in the polycentric climate governance architecture.

10.3 Institutional Linkages in Polycentric Climate Governance
10.3.1 Conceptualising Institutional Linkages

Linkages between individual units of governance are key to polycentric governance, particularly as they may result in mutual adjustments improving the overall coherence of the governance landscape. Institutional linkages have been studied extensively in the environmental politics literature and, as a result, we can draw on a variety of typologies (e.g. Young, 1996; Stokke, 2001; Oberthür and Gehring, 2006) to help us better understand them.

Among the first to provide a typology of institutional linkages was Young (1996), who distinguished among embedded, nested, clustered and overlapping institutions. The first category refers to international institutions that are embedded in overarching institutional arrangements. As most are international treaties, they are embedded in the general principles of international law and society, such as the principle of sovereignty (Young, 1996). The second category involves institutions that are nested in, and restricted by, a broader institutional framework. This is clearly demonstrated by the high number of protocols folded into environmental framework conventions. The third refers to situations in which several international agreements are deliberately combined into a new agreement, even though there is no functional need. The fourth category includes institutions that serve different purposes but impact each other in the process, without reference to each other (Young, 1996: 6).

Young emphasised that this typology is not exhaustive, and that the categorisation was intended as ‘an initial step towards understanding the nature and significance of institutional linkages in international society’ (Young, 1996: 2). Subsequently, Stokke (2001) provided a refined classification, distinguishing between utilitarian, normative and ideational interactions. Utilitarian interactions refer to situations in which institutions affect the costs and benefits of the behavioural options addressed by the other institution. Normative interactions occur when one institution confirms or rejects the norms of the other institution, which affects the normative effectiveness of that institution. The third category draws attention to learning processes between the interacting institutions.

A third categorisation was introduced by Oberthür and Gehring (2006), who distinguished among cognitive interactions, interactions through commitment, behavioural interactions and impact-level interactions. They focused more strongly on the causal mechanism underlying these interactions, or, in other words, on the processes or pathways through which the interactions are shaped. Cognitive interactions imply that one institution influences the development of another institution through knowledge and information. An interaction through commitment refers to overlapping or conflicting normative commitments. Behavioural interactions occur when the behavioural change triggered by one institution affects the performance of the other institution. Finally, impact-level interactions refer to situations in which the side effects of the activities by one institution affect the implementation of the targets of the other institution.

Interestingly, the aforementioned efforts, and in particular Young’s (1996), mostly focus on linkages between international treaties and regimes. However, it is widely acknowledged that the landscape of climate governance is no longer solely governed by state authority, top-down regulations and international treaties and organisations. Consequently, Young’s typology cannot easily be applied to assess linkages in a more diverse and multilayered landscape, including bottom-up initiatives, voluntary private arrangements and public-private partnerships. The typologies by Stokke (2001) and Oberthür and Gehring (2006) are more flexible in this regard, since these focus on the causal mechanism shaping the linkages. In a different attempt to close this knowledge gap, Eberlein et al. (2013) introduce a framework to analyse ‘transnational business governance interactions’. Their framework enables the analyst to study drivers, forms, causal mechanisms and pathways, and effects of linkages between heterogeneous actors that have varying capacities and are located within diverse institutional contexts (Eberlein et al., 2013: 2). However, as the scholars emphasise themselves, this is merely a modest initial attempt to assess the effects of linkages on ‘regulatory capacity and performance’ (Eberlein et al., 2013: 14), and it is not yet sufficient to study the effects on the performance of a polycentric governance landscape as a whole.

Comparing the typologies by Stokke (2001) and Oberthür and Gehring (2006) reveals that some types display similar characteristics in terms of the causal mechanisms underlying the linkages. Both the ideational interaction and the cognitive interactions are based on learning processes as causal mechanisms. In addition, the normative interaction as well as the interaction through commitment is based on the diffusion of norms and principles. Finally, the utilitarian and impact-level interactions overlap in the way that they are both focused on the interacting impacts of the institutions’ activities. Therefore, these three types of linkages can be considered similar, and are here summarised under the most recent terminology: cognitive linkage, linkage through commitment and impact-level linkage (Oberthür and Gehring, 2006).

In addition, the categorisations introduced earlier are not exhaustive. One could think of additional mechanisms through which linkages can be shaped – for example, financial flows, shared resources, political ideas and discourses, and so on. Finally, the aforementioned studies focus on dyadic linkages between units of governance, while to analyse polycentricity, it is necessary to go beyond these dyadic linkages and to analyse polyadic linkages among different units of governance. Only this would serve the ultimate goal of assessing the impacts on the performance of a governance landscape in addressing the issue or attaining the societal goal.

Clearly, to assess linkages in a polycentric governance landscape, it is important to reconsider and refine existing typologies of linkages. Table 10.1 serves as a starting point by summarising, combining and slightly adjusting the applicable types of linkages to make them fit the polycentric governance debate. In combination with Eberlein et al. (2013), this is a first step towards finding linkages in a governance landscape that is characterised by the diversity of actors and governance processes.

Table 10.1 Summary of applicable types of linkages

Type of institutional linkageDescriptionCausal mechanismReference
Cognitive linkageGovernance units are linked through the exchange of knowledge, information and ideasLearning processStokke (2001); Oberthür and Gehring (2006)
Linkage through commitmentThe (voluntary) commitments of a governance unit influence or enter into those of another governance unitNorms, commitments, principles, objectives or goalsStokke (2001); Oberthür and Gehring (2006)
Behavioural linkageThe behavioural change triggered by a governance unit influences the performance of another governance unitBehavioural changeOberthür and Gehring (2006)
Impact-level linkageThe ultimate targets of governance units intersectImpacts of activitiesStokke (2001); Oberthür and Gehring (2006)
10.3.2 Examples of Linkages between State and Non-state Climate Action

Empirical work on institutional linkages has demonstrated the influence governance institutions can have on the development and performance of others. Most research has focused on multilateral institutions, for instance the linkages between the UN climate regime and the World Trade Organization (e.g. Brewer, 2003; Charnovitz, 2003; van Asselt, 2014). We provide illustrations of each type of linkage identified earlier and include linkages between public and private institutions. Our empirical focus is on climate actions in the renewable energy field.

First, cognitive linkages appear to occur frequently and can be identified relatively easily. The Renewable Energy Policy Network for the 21st Century (REN21), for example, connects a wide range of key actors in climate governance to facilitate knowledge exchange. Thereby, this network facilitates cognitive linkages between international organisations, such as the International Renewable Energy Agency (IRENA) and the International Energy Agency (IEA), non-governmental organisations such as the World Council on Renewable Energy, and multi-stakeholder partnerships such as the Renewable Energy and Energy Efficiency Partnership. The cognitive linkages between these different types of governance units are easily identified; however, the more challenging analytical step is to assess if the linkages actually affect the development, performance and preferences of these governance units. This would require a more extensive review of official documents and interviews. Additionally, a cognitive linkage can also be intentional when a request for assistance is involved. This is the case between the IEA and the UNFCCC. In 2012, the IEA and the UNFCCC signed a Memorandum of Understanding, which committed both institutions to a closer and active exchange of information (Heubaum and Biermann, 2015). Upon request, the IEA now provides its statistics and knowledge on energy systems to inform the UNFCCC secretariat to support the parties to the UNFCCC.

Second, linkages through commitment can be observed, for example, between the UNFCCC and the Sustainable Energy for All (SE4All) initiative. Before elaborating on this linkage, is it important to note that an ‘interaction through commitment’ is interpreted flexibly. Since hard law and rule-making is less prominent in polycentric governance, while voluntary commitments increasingly occur, here a ‘commitment’ does not solely refer to imposed rules, but also to (voluntarily set) principles, norms, objectives or goals, etc. SE4All was set up to address the dual challenge of reducing carbon intensity of energy use and expanding energy access globally. More specifically, SE4All pursues efforts to hold the increase of the global average temperature to well below 2°C above pre-industrial levels and pursue efforts to limit the increase to 1.5°C (SE4All, n.d.). Hereby, the objective of the Paris Agreement framed the goal of SE4All, influencing the development and performance of the initiative. Given the global recognition of the 2/1.5°C objectives, it is plausible that they will likewise frame the goals and commitments of other types of initiatives.

A potential behavioural linkage occurs between the Friends of Fossil Fuel Subsidy Reform and RE100. The Friends of Fossil Fuel Subsidy Reform is an informal group of countries, set up in 2010, which aims to build political consensus on the importance of phasing out harmful fossil fuel subsidies. According to the Friends of Fossil Fuel Subsidy Reform, these subsidies encourage wasteful consumption of energy, which in turn disadvantages the use of renewable energy. Consequently, to the extent the Friends of Fossil Fuel Subsidy Reform is successful in phasing out these subsidies, it could trigger a behavioural change towards the use of renewables. Therefore, it potentially increases the effectiveness of RE100, which is an initiative of businesses collaborating to massively increase the demand and supply of renewable energy (RE100, n.d.). Since the impact of the Friends of Fossil Fuel Subsidy Reform initiative is still unknown, this is a potential linkage of which both the occurrence and the effect remain uncertain. Still, it could be worthy of consideration for future research.

Finally, impact-level linkages imply that the side effects of the activities by the source institution affect the performance of the target institution unintentionally. An interesting example of this linkage can be found in the Kyoto Protocol, more specifically the set-up of CDM projects, and the Global Network on Energy for Sustainable Development. For developed countries, the CDM projects are a way to generate credits to achieve compliance to their emission limitation and reduction targets under the Protocol. The prerequisite was that the projects were to be set up in developing countries to support their sustainable development. Therefore, the side effects of these CDM projects, for example improving energy access, affect the effectiveness of the Global Network on Energy for Sustainable Development, whose main objective is to support energy access and sustainable development in developing countries. Beyond anecdotal evidence, however, identifying impact-level linkages has proven difficult. As Oberthür and Gehring (2006) argue, this type of linkage is complex to identify as it does not involve a social interaction, but rather a biophysical or scientific link between the targets of the governance units. However, we prefer not to assume it is impossible and recognise that it requires intensive collaboration between different disciplines to assess such a linkage.

To conclude, the typologies by Stokke (2001) and Oberthür and Gehring (2006) can be applied to study linkages in a polycentric governance landscape. However, doing so properly requires time-intensive empirical research, including extensive documentary reviews and interviews, to assess the causal pathways and their effects. In addition, covering all linkages in the polycentric landscape of climate governance does not seem feasible since the number of governance units being linked can be in their hundreds. A more realistic research strategy might instead focus on critical nodes or sub-areas of the broader polycentric climate governance system (e.g. renewable energy in this brief discussion).

10.4 Strengthening Linkages in Polycentric Climate Governance

Mapping and identifying linkages in the climate governance network shows the potential that exists for ideas and innovations to diffuse through the system (see Chapter 9). For polycentric climate governance to be conducive to a low-carbon future, however, synergies need to be strengthened while conflicts need to be avoided or minimised. This section consequently discusses coordination efforts to enhance synergistic linkages between different institutions and organisations by the UNFCCC, national and regional initiatives and transnational initiatives themselves.

10.4.1 A Framework for Coordinating the UNFCCC and Non-state Climate Action

Within a polycentric climate governance environment, traditional political actors, such as governments and international organisations, are likely to remain important. Polycentricity implies that such actors are part of a complex system that includes non-state and subnational actors. Traditional actors can create synergies and strategic linkages between different types of actors, and between the international regime and the non-state realms, to achieve climate goals. International organisations often enjoy a high degree of legitimacy through their broad membership of national governments. However, in their traditional role as facilitator of international negotiations, they have also become associated with slow-moving and often deadlocked regimes. Closer engagement of non-state and subnational actors could provide an attractive complement to these traditional roles. Various international organisations have tried to encourage non-state actors to register their actions, for instance at the 2002 World Summit for Sustainable Development. These efforts have often been unsuccessful (Pattberg et al., 2012). Much emphasis was put on the launch of non-state actions; however, the lack of follow-up processes prevented systematic tracking of performance of individual initiatives and an assessment of aggregate contributions towards global targets and goals. Moreover, international organisations often lacked the mandate and the means to support new or struggling initiatives.

In the context of the UNFCCC, considerable progress has been made in recent years towards more orchestration by key governments (in particular presidencies of annual Conference of the Parties [COP]: Peru, France and Morocco), as well as the UNFCCC secretariat and the Executive Office of the UN Secretary-General (see also Chapter 11). These key political actors have strategically engaged with the broader environment of non-state and subnational climate actions. The engagement of non-state and subnational actors has been central to the so-called Workstream 2 of the UNFCCC’s Ad Hoc Working Group on the Durban Platform for Enhanced Action, which was the body responsible for negotiating the Paris Agreement.

This Workstream was particularly concerned with strengthening climate action and ambition before 2020 because non-state and subnational actors could make mitigation efforts in addition to what states do. The UNFCCC secretariat also presented ‘international cooperative initiatives’, including non-state and subnational actions that ‘could provide added value to Parties’ actions and bring sizeable emission reductions’ (UNFCCC, 2013). Moreover, as part of the Workstream, technical expert meetings were organised to feature international cooperative initiatives as solutions for governments seeking to enhance their mitigation ambition. The negotiations towards the Paris Agreement also provided new impetus for key governments and the wider UN system to engage non-state and subnational actors. A milestone in this regard was the convening of the 2014 UN Climate Summit by UN Secretary-General Ban Ki-moon, which was dedicated to commitments to actions by business, investor, local and regional leaders.

Subsequent presidencies of the COP to the UNFCCC, and the UNFCCC secretariat, have continued efforts to ‘galvanize and catalyse climate action [to] reduce emissions, strengthen climate resilience, and mobilise political will for a meaningful legal agreement in 2015’ (UN, 2014). For instance, the Peruvian government, together with the then-incoming French COP presidency, the Office of UN Secretary-General and the UNFCCC secretariat, launched the ‘Lima-Paris Action Agenda’ to incentivise more actions ahead of the COP in Paris. After Paris, these efforts were sustained – albeit under a new name, the Marrakech Partnership.

Arguably, consecutive efforts have amounted to a coordination framework for actions between the UNFCCC and non-state and subnational initiatives, a ‘global climate action agenda’ (Chan and Pauw, 2014; Chan et al., 2015b; Widerberg and Pattberg, 2015). This framework has partly become formalised through the Paris outcome, as governments agreed to appoint ‘high-level climate action champions’ to mobilise and showcase climate actions by non-state and subnational actors at high-level climate action events. The decision coming out of Paris also helped to strengthen links between non-state actors and the UNFCCC. Specifically, governments decided to extend technical expert meetings to also cover adaptation; to gather insights from the technical expert meetings on an annual basis; to emphasise the Non-State Actor Zone for Climate Action (NAZCA) as the main platform for registering non-state climate actions; to encourage the registration of more actions; and to install two ‘high-level champions’. The champions take some of the burden away from COP presidencies and the UNFCCC secretariat in the mobilisation of non-state and subnational climate actions and the organisation of an annual high-level event for climate action, while ensuring the continuity of mobilisation efforts, at least until 2020.

However, increased coordination in the context of the UNFCCC has not necessarily created synergistic linkages between intergovernmental regimes and non-state initiatives that ensure effective achievement of climate goals. In terms of linkages, the existing framework falls short of exploiting opportunities to ensure that non-state actors deliver effectively and in a balanced manner. For instance, the overemphasis on the showcasing of non-state and subnational climate commitments (e.g. through NAZCA) ignores the fact that many commitments may not be met, and that some commitments may be disingenuous (consider, e.g., a multinational corporation that seeks to present business as usual as clean and green). Moreover, current studies show that mobilised initiatives are not performing equally as well across sectors and countries (Chan et al., 2015a); resilience and adaptation initiatives are underperforming compared to mitigation initiatives, and initiatives perform worst in least developed countries. A framework that primarily seeks to improve visibility and recognise voluntary commitments puts a spotlight on imbalances that arise in a self-organising polycentric governance environment, rather than remedying them. For instance, by strengthening the role of private actors – often based in developed countries – such a framework could exacerbate disparities between mitigation and development needs, and between developing and developed countries. Proponents of a ‘comprehensive framework for climate actions’ have therefore argued that coordination should also provide material and ideational support and encourage accountability to ensure that non-state initiatives are in line with objectives under international agreements, in particularly under the Paris Agreement and the 2030 Agenda for Sustainable Development (Chan and Pauw, 2014; Hale and Roger, 2014; Chan et al., 2015b; Widerberg and Pattberg, 2015).

While the Paris outcome constitutes the most comprehensive framework to link the UNFCCC with other actors in the more polycentric landscape, it still could be improved. For instance, the emphasis of the ongoing climate action agenda is still on mobilising action, while much less attention is given to evaluating the performance of initiatives, let alone whether their aggregate impact is consistent with long-term objectives (see Chapter 12). Without such evaluation and assessment of non-state initiatives, key players in the UNFCCC process cannot design evidence-based interventions to maximise non-state mitigation contributions, or to provide targeted support in areas where non-state actors underperform. Part of the difficulty in creating beneficial linkages lies in the fact that coordinating actors, for instance the UNFCCC secretariat, often lack the political mandate and sufficient capacity themselves to ensure transparency and effectiveness of non-state initiatives. Although the UNFCCC secretariat has some capacity to mobilise initiatives and showcase them in international forums – especially in connection to the international conferences and intergovernmental negotiations they traditionally facilitate – its capacity to perform assessments of individual initiatives is very limited, let alone to evaluate whether a larger realm of climate actions and commitment is bringing long-term goals within reach.

In a polycentric governance system, however, there is no reason why the function of coordination should be concentrated in the hands of one or a few actors. Instead, the coordination of actions itself could be distributed in a network of, for instance, research groups and international organisations (Chan et al., 2015a). For example, UN organisations could (continue to) mobilise actions and administer an online platform recording initiatives; their achievements could be hosted by another public institution; individual assessments could be performed by research organisations; and the UNFCCC secretariat could compile individual assessments into periodic progress reports. Such a distributed coordination framework could leverage distributed capacities and resources in a polycentric governance system, and – contrary to one-off mobilisation campaigns – provide material and ideational support to new or underperforming actions, and track progress and aggregate impacts towards low-carbon and climate-resilient development.

10.4.2 National and Regional Platforms

Beyond the international processes aiming to strengthen linkages in the polycentric climate governance system, local and national initiatives to coordinate various climate actions are starting to emerge (see also Hale and Roger, 2014). For example, in Sweden, the government has appointed a national coordinator to develop and maintain a platform for dialogue and cooperation between the government and non-state actors such as companies, cities, regions, civil society organisations and academia, as well as among the non-state actors themselves. It currently engages about 170 different organisations that have signed a declaration stating they will show leadership and promise to contribute to further reductions of greenhouse gas emissions.

The platform is a continuation of the already existing initiative Fossilfritt Sverige that was launched by the government in the run up to COP21 in Paris. Besides functioning as a liaison between the government and non-state and subnational actors, the platform and the coordinator are also mandated to engage more organisations in the platform and increase the visibility of their actions. Fossilfritt Sverige is also directly linked to the UNFCCC process as it encourages its members to report to the NAZCA platform. The platform is also a way to link the low-carbon agenda to broader industrial policy processes such as the national export strategy, smart industry and reindustrialisation strategy, the agenda for a bio-based economy, the national innovation council and several others (Kommittédirektiv Initiativet Fossilfritt Sverige, 2016: 66). Fossilfritt Sverige emerged out of an understanding by the Swedish government and its partners that coordination was needed to enhance linkages between initiatives and the government. By coordinating actions, the hope of the government is to create synergies and learning effects between organisations across sectors through dialogue, cooperation and learning.

10.4.3 Transnational and Private Initiatives

Linkages in the polycentric governance system are increasingly and deliberately created by transnational and private initiatives. The global climate action agenda mentioned earlier also stimulates linking between transnational initiatives by categorising actions under different action areas and by appointing lead organisations to organise events aimed at actions within a certain sector. For instance, in the Paris Process on Mobility and Climate, 15 transnational initiatives collaborate to hold stakeholder meetings, to engage with high-level processes (including the global climate action agenda) and to produce joint progress reports (Paris Process on Mobility and Climate, n.d.).

Non-state and transnational networks can also contribute in a more direct manner to the international climate process. For instance, non-state actors could contribute information to the assessment and review of national climate pledges made under the UNFCCC (van Asselt, 2016). Moreover, non-state expert networks have directly supported the global climate action agenda. Galvanizing the Groundswell of Climate Actions, a network convened by experts from a variety of civil society and research organisations, and defining itself as ‘a series of open dialogues that aims to bring the groundswell of climate actions from cities, regions, companies, and other groups to a higher level of scale and ambition’ (Galvanizing the Groundswell of Climate Actions, n.d.) has suggested options for the global climate action agenda and closely advised high-level climate action champions, for example on priority areas to address at high-level action events. The network produced an assessment of 70 initiatives launched under the Lima-Paris Action Agenda and has continued to identify opportunities to strengthen linkages between the international climate regime and non-state climate actions, for instance by engaging funders through a memorandum on how they can accelerate global climate action until 2020 (Galvanizing the Groundswell of Climate Actions, n.d.).

These instances illustrate that the gradual development of a more comprehensive framework linking the transnational and international climate realms is not characterised by one-way traffic, with traditional actors in international politics – governments and international organisations – reaching out to non-state actors and their contributions. Rather, the global climate action agenda – and the building blocks of a more comprehensive framework – have been a co-production between state and non-state actors.

10.5 Conclusions

Global climate governance is no longer an exclusively intergovernmental process. It has become a more polycentric governance system that is open to a range of non-state, non-party, subnational and private actors. In this chapter, we have shown that the polycentric system of climate governance is not only constituted as relatively independent initiatives, but also that climate actions are interlinked and consequently form a networked structure. To better scrutinise the possible and actual linkages among institutions in the polycentric governance system, we have provided an overview of four types of linkages and corresponding illustrations from the climate field. We can make three concluding observations.

First, the dense interaction structure in the polycentric climate governance system enables an exchange of resources via shared membership. Organisations in the network can exchange knowledge, norms and information, thereby enabling mutual adjustment and experimentation – two central propositions within polycentric theory (see Chapter 1). Furthermore, the potential to exchange resources such as information through the network allows for linkages to form that can lead to behavioural interdependence, i.e. a situation of mutual adjustment. As a consequence of the dense structure and the linkages between governance units, the polycentric climate governance system might display characteristics of a complex system in which the whole is more than the sum of its parts.

Second, while the system is polycentric, it also demonstrates elements of integration. In particular, the strong and central position of the UNFCCC (which acts as a centre of gravity in the system) is well reflected in the network analysis as well as in the observed interaction through commitment where normative foundations of the UNFCCC are streamlined into non-state initiatives. In particular, the Paris Agreement and its 2/1.5°C goals serve as such an integrative device.

Third, based on our empirical illustrations from the renewable energy field, we see little evidence of conflictive linkages. While more systematic research on the overall quality of linkages in the polycentric climate governance system is needed, it is an encouraging sign that linkages are often synergistic. In part, this might be the result of attempts to strengthen linkages discussed in this chapter.

Finally, what is the value of polycentric governance? While it helpfully serves as a concept to describe the evolving landscape of climate governance, it also raises questions. In particular, no agreement can be found in the literature on what constitutes a minimum level of independence in terms of norm- and rule-setting abilities of individual initiatives in order to constitute a polycentric structure. In addition, no threshold values are defined for linkages. In this chapter, we have suggested that the degree of connectivity in the polycentric governance system is high, as is the number and types of linkages present in the climate governance system. Beyond serving as a broad and inclusive concept, the analytical value of polycentric governance seems to be limited in the case of networked climate governance. One way forward would be to more openly embrace the theoretical implication of understanding climate governance as a system. Beyond the metaphoric use, this would mean that researchers start to apply insights from complexity theory (which deals with the behaviour of complex systems). An intermediate step towards this goal could be to reflect more on the system-theoretical assumptions underlining polycentric governance theory.


* The authors would like to thank the participants in the INOGOV workshop on ‘Governing Climate Change: Polycentricity in Action’ (Heerlen, the Netherlands, March 2017) and the editors of this book for their very helpful comments on an earlier draft of this chapter. We thank Martina Rigoni for research assistance on this chapter. Philipp Pattberg and Oscar Widerberg also acknowledge support from the Netherlands Organisation for Scientific Research (NWO), grant 016.125.330 (Assessing and Reforming the Current Architecture of Global Environmental Governance).

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11 Orchestration Strategic Ordering in Polycentric Governance

Kenneth W. Abbott
11.1 Introduction

Global climate governance has undergone a ‘Cambrian explosion’ of organisations, norms, ‘contributions’, commitments and other institutions (Keohane and Victor, 2011; Abbott, 2012). The result is an intricate, diverse institutional complex that exhibits the defining features of polycentric governance (see Chapter 1). Multiple centres of decision-making authority adopt rules, standards and policies and conduct other governance activities; these authorities act at multiple scales, from international to local (Ostrom, 2010a; Cole, 2011, 2015).

Recent trends have increased polycentricity: climate institutions have become more numerous and diverse. Nationally determined contributions (NDCs) under the Paris Agreement allow for diverse national commitments; subnational governments have expanded their commitments and actions, domestically and transnationally; and a new voluntary commitment system (VCS) has encouraged domestic and transnational initiatives by non-state actors (Abbott, 2017). As polycentric governance theory suggests, these developments should increase the resilience of climate governance; for example, as the Trump administration weakens US support for intergovernmental action, private and subnational actions may provide partial substitutes.

Polycentric governance has costs as well as benefits (Keohane and Victor, 2011; Abbott, 2012; van Asselt and Zelli, 2014; see also Chapter 1). Many scholars therefore conclude that polycentric structures operate more effectively with modest levels of coordination or ordering (Zürn, 2010; Betsill et al., 2015; Mayntz, 2015; Dorsch and Flachsland, 2017). This chapter focuses on orchestration, an important approach to institutional ordering widely applied in climate governance.

Orchestration is an indirect mode of governance that relies on inducements and incentives rather than mandatory controls (Abbott et al., 2015). It is common in many areas of global governance, where ‘governors’ – from intergovernmental organisations (IGOs) to transnational initiatives – possess limited authority and power for binding, direct action. But even powerful governors, including states, engage in orchestration. An orchestrator (O) works through like-minded intermediaries (I), catalysing their formation, encouraging and assisting them and steering their activities through support and other incentives, to govern targets (T) in line with the orchestrator’s goals (O-I-T). An orchestrator can also structure and coordinate intermediaries’ activities to enhance ordering (Abbott and Hale, 2014; Abbott, 2017).

The prevalence of orchestration has significant implications for several of the core propositions of polycentric governance theory outlined in Chapter 1. I consider three such propositions here:

  1. (1) Local action: that organisations constituting polycentric systems emerge spontaneously at local levels amongst self-organising actors, perhaps facilitated by organisational entrepreneurs (Andonova, 2017; see also Chapter 7), but without higher-level intervention. In climate governance, by contrast, states, IGOs and other actors have actively catalysed and facilitated the formation of many new organisations.

  2. (2) That organisations within polycentric systems spontaneously coordinate their actions through mutual adjustment, without centralised intervention. In climate governance, by contrast, while many organisations undoubtedly adjust to one another’s actions, states and IGOs have orchestrated extensively to structure the complex, although they have not strongly coordinated organisational behaviour.

  3. (3) That polycentric systems promote experimentation, policy innovation and learning (see Chapter 6). Polycentricity (and orchestration) have stimulated climate experimentation in a broad sense by encouraging diverse organisations and actions (Hoffmann, 2011). Yet the pursuit of other governance goals limits experimentation in some domains. In addition, without an organised system to manage experiments and evaluate their results, climate experimentation and learning fail to reach their full potential (Abbott, 2017).

This chapter first maps the climate governance complex, identifying orchestrators, intermediaries and targets. It then contrasts theoretical perspectives that emphasise spontaneous, decentralised coordination, including polycentric governance theory, with more strategic approaches, including orchestration. It reviews actions across many areas of climate governance, demonstrating the importance of orchestration. It then considers the findings of the analysis, returning to the three propositions identified earlier. This chapter closes by suggesting areas, including experimentation, where further orchestration may be desirable.

11.2 Orchestrators, Intermediaries and Targets in Climate Governance

Global climate governance consists of multiple types and systems of organisations. Figure 11.1 depicts the principal organisations and groupings, highlighting different scales and levels of organisation.

Figure 11.1 The polycentric governance complex for climate change.

11.2.1 Intergovernmental Bodies

Many intergovernmental bodies play important roles in climate governance (see Chapter 2). Many act as orchestrators, as discussed in what follows; some are potential intermediaries. The United Nations Framework Convention on Climate Change (UNFCCC) and the Paris Agreement are the core of the regime. They encompass multiple organs – including the Conference of the Parties (COP), COP presidencies and the UNFCCC secretariat – and diverse subsidiary bodies, such as the Technology Executive Committee (TEC) and the Climate Technology Centre and Network (CTCN). UNFCCC organs have also created specialised institutions to promote voluntary commitments. Closely linked to the UNFCCC are its financial mechanisms and the Intergovernmental Panel on Climate Change (IPCC).

Numerous IGOs address climate policy (van Asselt, 2014). These include the Office of the United Nations Secretary-General (UNSG), the United Nations Environment Programme (UNEP) and other United Nations (UN) agencies, and the High-Level Political Forum on sustainable development. International financial institutions (IFIs), such as the World Bank, provide finance and expertise. All of these act as orchestrators. Limited-membership climate ‘clubs’ include the G20 and the Major Economies Forum. Multilateral treaties with climate impacts include the Montreal Protocol and the Convention on Biological Diversity.

11.2.2 National Actions

National laws, policies and commitments are central modes of climate governance (see Chapter 3). NDCs under the Paris Agreement are ‘nationally determined’, but subject to review and expectations of increasing ambition. Some governments have separately adopted innovative climate policies (Jordan and Huitema, 2014a, 2014b); a few are active orchestrators (Abbott and Hale, 2014). Overall, however, because current national actions fall well short of what is needed to achieve the Paris Agreement goals, national actions remain important targets of climate orchestration.

11.2.3 Subnational Actions

The laws and policies of cities, provinces and other subnational governments are increasingly important in climate governance (see Chapter 5). Subnational governments have made extensive climate commitments – individually, through transnational associations and through the voluntary commitment system (Betsill and Bulkeley, 2006; Bulkeley, 2010; Widerberg, Pattberg and Kristensen, 2016; see also Chapter 4). Yet local actions too remain targets of orchestration. Highly institutionalised associations – such as C40 Cities, ICLEI – Local Governments for Sustainability, the Covenant of Mayors and the World Mayors Council on Climate Change – act as orchestrators and intermediaries.

11.2.4 Private Initiatives

Private activities are the source of most greenhouse gas emissions and so are the ultimate targets of climate governance. Until recently, the climate regime focused heavily on national commitments. Yet since the 1990s, business groups, environmental non-governmental organisations (NGOs) and other private actors have created numerous voluntary initiatives outside of UNFCCC processes (Abbott, 2012; Abbott, Green and Keohane, 2016; Widerberg et al., 2016). Many reflect the self-organisation highlighted by polycentric governance theory.

Some initiatives include governments or IGOs; many are purely private. Examples include the Verified Carbon Standard (business), the Gold Standard (civil society), the Greenhouse Gas Protocol (business and civil society) and the Climate and Clean Air Coalition (CCAC) (business, civil society and government). These initiatives set standards for private behaviour, provide financing, carry out operational activities such as registering carbon offsets and promote information exchange. They can be significant intermediaries.

11.2.5 Voluntary Commitment System

Building on precedents in the sustainable development regime (Abbott, 2017), a VCS encouraging voluntary commitments by non-state actors has been developed since 2014, when the UNSG sponsored the UN Climate Summit to catalyse voluntary commitments. At COP20 in Lima in 2014, the current and incoming presidencies, the UNSG and the UNFCCC secretariat launched the Lima-Paris Action Agenda (LPAA) to showcase commitments and encourage new ones; in parallel, they established the Non-state Actor Zone for Climate Action (NAZCA) portal, an online registry which now lists more than 12,500 commitments. COP21 in Paris accepted additional commitments and agreed to name two ‘high-level champions’ to promote voluntary initiatives. At COP22, the first champions launched the Marrakech Partnership for Global Climate Action (MP) to ‘catalyse and support climate action by Parties and non-Party stakeholders in the period from 2017–2020’ (Global Climate Action Champions, 2016; see also Chapter 4).

This review demonstrates the polycentric character of climate governance – the institutional complex includes ‘multiple governing authorities at different scales rather than a mono-centric unit. Each unit … exercises considerable independence to make norms and rules within a specific domain (such as … a local government, a network of local governments, … a national government, or an international regime)’ (see Chapter 1, quoting Ostrom, 2010b). It also highlights the range of organisations that act as orchestrators and intermediaries, and the targets’ orchestration addresses. We now consider how these organisations emerge and interact.

11.3 Ordering: Decentralised and Strategic

Polycentric governance theory emphasises decentralised, horizontal ordering, both in the formation of organisations and in their ongoing interactions. Orchestration – and related techniques including delegation (Green, 2014) and direct regulatory cooperation (Abbott et al., 2015) – challenge these understandings. They involve more strategic interventions – that is, actions that are part of a plan designed to achieve an overall goal – that are often taken at higher governance levels. This section compares these two perspectives and introduces orchestration in greater detail.

11.3.1 Decentralised Ordering

Self-organisation is ‘a key underlying concept in the polycentric literature’ (Dorsch and Flachsland, 2017: 51). Considering organisational formation, Elinor Ostrom and colleagues analysed the ability of small local communities to self-organise common-pool resource management systems, without mandatory regulation or other hierarchical interventions (Ostrom, 1990, 2010a; Poteete, Janssen and Ostrom, 2010). In appropriate conditions, local communities can overcome free-rider incentives (in part due to local co-benefits), build trust and overcome collective action problems that challenge larger groupings. In later work on climate change, Ostrom (2010b) noted the burgeoning activities of subnational governments, equating these with community self-organisation, and called for many small-scale, multilevel climate actions, in addition to monocentric national and international actions (see Chapter 1).

The focus on mutual adjustment among organisations derives from studies by Vincent Ostrom and colleagues of local government authorities (Ostrom, Tiebout and Warren, 1961; Bish and Ostrom, 1973). Many metropolitan areas feature multiple authorities with similar functions, such as local police forces. The then-dominant approach to public administration favoured consolidating these into unitary agencies. Ostrom argued, however, that local units are often more effective – they better reflect local preferences, better provide services requiring personal contact and are more responsive and efficient than ‘monopolistic’ unitary authorities. In addition, while critics emphasised the supposed duplication and inefficiency of multiple authorities, Ostrom found that horizontal ordering often avoided those problems: authorities coordinated their activities, contracted for services, created dispute resolution procedures and competed (e.g. on taxes) in ways that promoted efficiency.

Other literatures on institutional complexity likewise emphasise decentralised ordering (see Chapter 10). The organisational fields literature (Dingwerth and Pattberg, 2009) emphasises isomorphism among organisations with similar functions; such organisations often take on similar features, procedures and rhetoric through social interactions such as mimicry and common professional norms (DiMaggio and Powell, 1991). Organisational ecology (Abbott et al., 2016) emphasises competition for resources – from funding to legitimacy – among similar organisations. Competition influences the types and numbers of surviving organisations and leads organisations to seek specialised ‘niches’, structuring the complex. Gehring and Faude (2014) argue that the members of multiple organisations – states, in their examples – enjoy the flexibility polycentricity offers, but also want their organisations to operate effectively. They therefore promote ‘decentralised coordination’, reducing or managing inefficient overlaps.

11.3.2 Strategic Ordering and Orchestration

Scholars have also identified more centralised, strategic approaches – still short of mandatory control – designed to enhance organisational formation and ordering (Isailovic, Widerberg and Pattberg, 2013; see also Chapter 10). Under the heading of ‘meta-governance’, or the governance of governance, scholars consider how authorities ‘at a higher level of decision-making’ (Beisheim and Simon, 2015: 8) – governmental or non-governmental – structure and manage interactions among lower-level organisations (Derkx and Glasbergen, 2014). In climate governance, Betsill et al. (2015) and van Asselt and Zelli (2014) argue that the UNFCCC has the capacity to coordinate and strengthen linkages among governmental and private governance organisations.

Orchestration is consistent with the meta-governance approach. Orchestration is indirect – an orchestrator works through intermediaries, rather than directly, to regulate or provide benefits to targets. It thus differs from direct modes of governance, including mandatory regulation and regulatory cooperation. A governor can use orchestration to enter new fields where intermediaries possess experience, contacts or authority it lacks, or where its own entry is contested.

Orchestration is also soft – while the orchestrator typically possesses some authority, in an orchestration relationship it cannot impose or enforce mandatory obligations on intermediaries; it must enlist organisations that share broadly similar goals and guide their behaviour through inducements and incentives. It thus differs from hard modes of governance, both direct (regulation) and indirect (delegation).

The techniques of orchestration address different points in the intermediary’s life and policy cycles. Initially, the orchestrator enlists the cooperation of existing intermediaries or catalyses the formation of new ones. It then encourages and assists intermediaries and steers their behaviour in line with its goals. Where there are multiple intermediaries, it coordinates their actions. All of these techniques rely on soft inducements: persuasion, convening relevant actors, material and ideational support (financing, guidance, technical assistance) and reputational incentives (recognition or endorsement, shaming). Support and endorsement simultaneously enhance intermediary capabilities and enable steering – the orchestrator can direct support to desired activities or make support conditional on them. The orchestrator may also mobilise persuasion, support and reputational incentives from third parties, multiplying its influence.

Governors of all types typically orchestrate when they lack certain capabilities needed for stronger forms of governance (Abbott et al., 2015). IGOs, for example, often lack sufficient authority for hard, direct governance, especially vis-à-vis private actors. While many IGOs have substantial expertise, they frequently lack material resources and other capacities for demanding operational activities. However, even strong, well-resourced organisations, including states, may turn to orchestration where direct or mandatory action would entail high political or material costs. While orchestration may be less powerful than mandatory control, it has proven influential in many settings (Abbott et al., 2015). When governors lack strong hierarchical authority, or share the relevant authority with others, it may be the only strategy available.

Diverse actors and organisations – governmental and non-governmental – act as orchestrators, but research suggests several qualities that influence their success (Abbott and Hale, 2014; Abbott et al., 2015). An orchestrator must have sufficient agency to apply the techniques of orchestration; a body like the High-Level Political Forum, which includes all UN member states, meets for short periods and lacks its own staff, will encounter problems of agency (Abbott and Bernstein, 2015). An entrepreneurial organisational culture facilitates orchestration and makes its use more likely. Inducements such as convening, persuasion and endorsement are more influential where the orchestrator possesses significant legitimacy and authority, derived from its focal institutional position, achievements, expertise or moral reputation. An orchestrator must possess or be able to mobilise sufficient resources. Connections to potential intermediaries are helpful but not essential.

The orchestrator is often at a higher governance level than its intermediaries; for example, the European Commission orchestrates networks of Member State regulators, and many IGOs orchestrate NGOs. Even here, however, orchestration remains non-hierarchical: intermediaries respond because of shared goals, persuasion, inducements and other incentives, not mandatory controls. Respected organisations may also orchestrate their peers (Abbott and Hale, 2014).

A governor can orchestrate only if suitable intermediaries are available. As Section 11.2 details, climate orchestrators benefit from many potential intermediaries, including IGOs, associations of subnational governments and private transnational initiatives. Where appropriate intermediaries are lacking, orchestrators often catalyse their creation, convening relevant actors and using persuasion, support and other incentives to encourage the formation of organisations with desired goals and structures. Some orchestrators – notably UNEP, whose role in creating private environmental initiatives provided the original model for orchestration (Abbott and Snidal 2009) – have catalysed numerous organisations, strongly suggesting that they find spontaneous self-organisation an unreliable source of suitable intermediaries.

Orchestration is valuable for structuring and coordinating intermediary relationships where mutual adjustment is insufficient (Abbott and Hale, 2014; Abbott et al., 2015). An orchestrator can use persuasion, material and ideational support and reputational incentives to encourage organisations to reduce overlaps, manage conflicts, fill governance gaps, collaborate and otherwise govern more effectively. Intermediaries may welcome coordination, which can increase their legitimacy and effectiveness.

11.4 Orchestration in Climate Governance

This section examines how orchestration has been used to catalyse, encourage, support, steer and coordinate diverse actors and organisations in climate governance. While many climate initiatives have emerged through self-organisation and engage in mutual adjustment, orchestration of organisational formation and ordering is nonetheless widespread. As in other areas, climate orchestration serves two broad purposes: ‘managing states’, encouraging strong national commitments and promoting implementation and compliance; and ‘bypassing states’, encouraging non-state commitments and actions where orchestrators view state actions as insufficient (Abbott et al., 2015: 11).

11.4.1 Voluntary Commitment System

In developing the climate VCS, orchestrators emulated techniques pioneered in sustainable development governance (Abbott, 2017). Sustainable development summits, supported by the UNSG, focused on catalysing partnerships that could act as intermediaries, promoting and coordinating individual actions by partners. They enlisted existing networks, including the UN Global Compact, originally an intermediary established by the UNSG and UN agencies to elicit business commitments to social responsibility, including through its Caring for Climate programme. They helped organise commitments into ‘action networks’ – such as Sustainable Energy for All (SE4All) – that act as intermediaries, eliciting and coordinating commitments and promoting accountability. They offered modest ideational support but relied primarily on reputational inducements, including public recognition and inclusion in an online registry.

The UNSG initiated the climate VCS at the 2014 UN Climate Summit, convening businesses, NGOs, subnational governments and even states and IGOs, and using persuasion and recognition to elicit commitments to climate action. The UNSG provided ideational guidance by encouraging commitments in areas of need – ‘action areas’ such as climate finance, energy and cities. It encouraged multi-stakeholder ‘cooperative initiatives’ that could function as intermediaries – like partnerships and action networks – eliciting, coordinating and managing individual commitments.

The Peruvian and French presidencies, the UNSG and the UNFCCC secretariat established the LPAA to encourage additional ‘transformative’ initiatives in the run-up to Paris. The NAZCA registry was designed to ‘showcase’ cooperative initiatives and other commitments, providing soft reputational incentives for organisational formation while facilitating collaboration and accountability. The orchestrators implicitly endorsed several organisations selected to provide the commitment information that NAZCA aggregates. Providers include the Carbonn Climate Registry and the Covenant of Mayors (subnational commitments), and the UN Global Compact and the Carbon Disclosure Project (CDP) (business commitments).

COP21 recognised new commitments at high-level public events. The COP decision adopting the Paris Agreement endorsed the VCS, welcoming voluntary commitments, encouraging NAZCA registration, urging governments to participate in cooperative initiatives and agreeing to recognise new commitments at future meetings. COP21 also created two new intermediaries: ‘high-level champions’ from the current and incoming presidencies, charged with promoting and supporting ‘voluntary efforts, initiatives and coalitions’ (see Chapter 4).

At COP22, the first ‘champions’, from France and Morocco, initiated the MP, a framework for orchestrating voluntary commitments, led by the champions, presidencies and UNFCCC secretariat, plus the UNSG as ‘global convenor’, reflecting its unique convening authority. These actors commit to:

  1. (1) Catalyse initiatives, convening stakeholders and governments through regional and thematic meetings, technical examination processes, the Global Forum of Alliances and Coalitions, COP ‘action days’ and other events. They will provide ideational guidance by setting priorities, and reputational incentives by highlighting successful initiatives. They will use persuasion and recognition to promote increased ambition and Southern participation and will encourage third-party support.

  2. (2) Track progress, requiring initiatives to register on NAZCA and provide regular updates on progress as conditions of participating in the MP. New criteria for commitments ‘encourage’ concrete goals, clear targets, scale, sufficient resources and transparency. Tracking is intended to promote accountability and to identify areas where additional actions are needed.

  3. (3) Showcase successes, publicising ambitious initiatives in priority areas through NAZCA, COPs and other events. Showcasing creates incentives to emulate successes, provides learning opportunities and allows for modest steering.

  4. (4) Report achievements to governments. The champions will identify options and priorities suggested by successful initiatives for technical examination processes, decisions on NDCs and COP deliberations.

As part of the VCS, governments and IGOs have initiated, supported and steered many cooperative initiatives. For example, UNEP and partners launched several energy efficiency initiatives in 2014, with financial support from the Global Environment Facility (GEF). The Efficient Appliances and Equipment Partnership brings together UNEP and the United Nations Development Programme, the International Copper Association and the Natural Resources Defense Council to promote efficient appliances. Through United for Efficiency, UNEP and partners help developing countries transition to efficient products. UNEP and Norway launched the 1 Gigaton Coalition to help countries measure and report emissions reductions from energy efficiency projects. All these initiatives collaborate with the SE4All action network.

Figure 11.2 Orchestrating voluntary climate commitments.

Orchestrators have used similar techniques to promote voluntary commitments by cities, provinces and other subnational governments (Figure 11.3). Among other intermediaries, orchestrators worked through transnational associations. For example, the World Bank provided significant financial support to C40 Cities, and collaborates with it in the Carbon Finance Capacity Building Program, encouraging carbon finance for ‘emerging megacities of the South’ (CFCB, n.d.). Entrepreneurial local leaders also used orchestration to catalyse, support and steer these associations. For example, illustrating orchestration among peers, Ken Livingstone, then the mayor of London, initiated C40 Cities in 2005, convening the mayors of 18 ‘megacities’ to collaborate on emissions reductions. Livingstone later invited the Clinton Climate Initiative (CCI) to collaborate on concrete projects. A subsequent C40 chair, Mayor Michael Bloomberg of New York, integrated the work of C40 and Clinton Climate Initiative staff.

Figure 11.3 Orchestrating subnational commitments.

11.4.2 Private and Public-Private Climate Schemes

Businesses, NGOs and other actors have created numerous private and public-private climate initiatives outside the VCS and before its creation (Hoffmann, 2011; Abbott, 2012; Bulkeley et al., 2012; Bulkeley et al., 2014) (figure 11.4). Many initiatives set standards for the behaviour of signatories – often relating to carbon offsets and markets, including emissions measurement, accounting and disclosure (Green, 2014; Abbott et al., 2016) – or elicit commitments from companies and other targets. Others conduct or finance pilot projects and other operational activities, facilitating learning and enabling disclosure systems, carbon markets and similar mechanisms. Many are now registered on NAZCA.

Figure 11.4 Orchestrating private climate schemes.

Participating actors created most of these schemes on a bottom-up basis, but orchestrators facilitated a number of them. UNEP has been particularly active, convening stakeholders, catalysing the formation of transnational environmental schemes and supporting new initiatives. As noted earlier, UNEP helped launch the multi-stakeholder Global Reporting Initiative (GRI) in 1997, endorsing it and providing significant ideational and material support. The UN Global Compact later endorsed GRI standards, which address carbon emissions and other environmental issues, for use by participating firms.

UNEP collaborated with Sweden and other governments to establish the CCAC to promote and facilitate action on short-lived climate pollutants. Through its Finance Initiative, and together with the UN Global Compact, UNEP coordinated the negotiation of the Principles for Responsible Investment and the Principles for Sustainable Insurance, which elicit commitments from investors and insurers to consider environmental, social and governance issues, including climate change. The UNEP Finance Initiative also sponsors the Portfolio Decarbonization Coalition, which encourages low-carbon investments, and the Sustainable Energy Finance Initiative, which supports investors in financing clean energy technologies.

The World Bank has been another active orchestrator (Hale and Roger, 2014), helping to establish schemes such as the Global Gas Flaring Reduction Partnership and Connect4Climate. National governments have collaborated with IGOs in catalysing initiatives such as Connect4Climate, and have independently supported initiatives such as CDP and the Collaborative Labeling and Appliance Standards Program (CLASP), a multi-stakeholder initiative to improve the environmental performance of appliances and equipment.

11.4.3 National Commitments and NDCs

Domestic political forces likely drive most national climate policies and NDCs (see Chapter 3); UNFCCC organs also directly encourage ambitious state actions. But some national commitments and policies derive in part from orchestration (Figure 11.5). The 2014 UN Climate Summit elicited national commitments – including commitments related to future NDCs – directly from governments, and indirectly through cooperative initiatives that include governments. For example, 40 governments, with many non-state actors, endorsed the New York Declaration on Forests; some committed to new forestry policies while others pledged financial support. Forty governments also helped launch the Global Energy Efficiency Accelerator Platform to support subnational governments.

Figure 11.5 Orchestrating NDCs and national policies.

The UNFCCC engages intermediaries to facilitate strong national actions. For example, within its Technology Mechanism, the Technology Executive Committee (TEC), which consists of technology experts, provides policy recommendations to governments. The Climate Technology Centre and Network (CTCN), which UNEP and the UN Development Programme host, arranges technical assistance on technology transfer (see Chapter 15). The CTCN operates as an orchestrator, coordinating a network of technology organisations that provide assistance to governments. Such assistance can catalyse ambitious actions, provide crucial ideational resources and steer national decision-makers towards the most beneficial actions.

UNFCCC Technical Expert Meetings engage governmental and non-governmental experts, who act as intermediaries promoting national adoption of ‘best practice’ mitigation policies with sustainable development co-benefits, reducing the costs and increasing the benefits of national action. The current and incoming presidencies, with the UNFCCC secretariat and other IGOs, launched the NDC Partnership in 2016 to link countries with the financial and technical resources needed to implement NDCs.

The Paris Agreement initiated three review processes, which may include elements of orchestration as well as direct interactions among governments and with UNFCCC officials (van Asselt et al., 2016):

  1. (1) Article 13 provides for review of national progress in implementing NDCs, based on national reports and other information. In addition to peer governments and the secretariat, this process will engage ‘technical experts’, who will act as intermediaries in assessing the information received. In addition, Article 13 review is intended to be ‘facilitative’ – it will identify barriers to national implementation, then encourage third parties, such as CTCN and the Green Climate Fund, to provide support that helps governments overcome those barriers.

  2. (2) Article 14 provides for a ‘global stocktake’ every five years from 2023, designed to inform periodic updates of NDCs. Stocktake procedures will primarily entail direct interactions among governments, but they could engage diverse intermediaries – including the secretariat, technical experts and other non-state actors – as information providers and persuaders.

  3. (3) Article 15 calls, in broad terms, for an implementation and compliance mechanism. It will involve an ‘expert-based’ committee; here, too, experts that are sufficiently independent could be considered intermediaries. This mechanism will again facilitate third-party support to address identified needs.

Even if non-state actors play only limited roles in formal review processes, their independent assessments have significant influence (van Asselt, 2016). Governments and IGOs can encourage, support, facilitate and publicise such assessments through orchestration.

The World Bank has created intermediaries to facilitate climate finance, supporting NDC implementation and policy and technical innovations. Its four Climate Investment Funds (CIFs) provide concessional financing for innovative policies in their domains, allowing countries to test new approaches, attract co-financing and qualify for new funding streams. While the World Bank and other IFIs support and guide the CIFs, they are independent organisations, governed by committees comprising donor and recipient governments, with diverse private and governmental observers. As such, they can tap varied public and private resources, material and ideational.

11.5 Climate Orchestration and Decentralised Ordering

The prevalence of climate orchestration, described in the previous section, has important implications for three of the central propositions of polycentric governance theory outlined in Chapter 1. I consider two of those propositions here, and a third in the concluding section.

11.5.1 Local Action

Polycentric governance theory asserts that new organisations emerge spontaneously as actors self-organise in local settings. Numerous organisations have entered climate governance in recent years – notably private and subnational initiatives – and many have self-organised at relatively small scales. In other cases, however, orchestrators have encouraged and facilitated organisational formation. This suggests that the spontaneous local action/self-organisation proposition is incomplete: observers of polycentric systems should also look for strategic actions that catalyse and incentivise organisational formation.

The entire climate VCS was a strategic construction. The UNSG, UNFCCC secretariat, presidencies and ultimately COP21 (O) worked through the champions, cooperative initiatives, subnational government associations and other intermediaries (I) to establish a system to elicit and register thousands of voluntary commitments from non-state actors (T). UNEP, the World Bank, other IGOs and governments also catalysed the formation of many cooperative initiatives and multi-stakeholder organisations, within the VCS and outside it. Under the MP, many of these actors are actively catalysing new initiatives. These actions have changed the shape of climate governance, created new opportunities for participation and new forms of commitment, and initiated new flows of information and ideas.

Orchestrators have utilised a range of techniques; while none involves mandatory control, all facilitate or influence desired behaviours through diverse pathways. Orchestrators enlisted existing intermediaries (COP presidencies, information providers) and catalysed formation of new ones (cooperative initiatives) through convening, persuasion and reputational incentives. They provided positive incentives for organisational formation through public recognition, endorsement and ‘showcasing’ – at public events, through NAZCA and in national and international policy processes. They provided ideational support to new organisations through information and guidance (action areas, MP priorities). Most provided little direct material support, but did facilitate third-party financing.

11.5.2 Mutual Adjustment

Polycentric governance theory asserts that organisations in polycentric systems spontaneously coordinate their behaviour through mutual adjustment, without centralised intervention. Many climate governance organisations do coordinate in this fashion, though sometimes only modestly. Secretariats and scientific bodies of the Rio Conventions, including the UNFCCC, coordinate through the Joint Liaison Group (CBD, 2013). Environmental IGO secretariats coordinate through the UN Environment Management Group. National governments can coordinate within COPs, the UN Environment Assembly and other institutions. Subnational governments collaborate through transnational associations, and private actors through multi-stakeholder initiatives and networks.

In other cases, however, orchestrators shape climate governance and encourage coordination among constituent initiatives. This suggests that the mutual adjustment proposition too is incomplete: observers of polycentric systems should also look for strategic actions that promote ordering and coordination.

States, IGOs and other orchestrators structure climate governance in several ways:

  1. (1) They encourage initiatives of particular kinds. The UN Climate Summit encouraged ‘cooperative initiatives’, commitments in specified areas and government commitments relevant to NDCs. The LPAA and Marrakech Partnership adopted mandatory criteria for voluntary commitments, an approach known as ‘directive orchestration’ (Abbott and Snidal, 2009). Only initiatives meeting those criteria may register on NAZCA and receive other reputational benefits, although the criteria are not always vigorously enforced.

  2. (2) They support intermediary initiatives that further favoured goals. The LPAA, MP and COP ‘showcase’ commitments they identify as ‘successes’, incentivising others to emulate them. Showcasing successful non-state initiatives also helps ‘manage states’ – it demonstrates to governments the actions their citizens are willing to take, undercuts excuses for inaction (such as infeasibility and cost) and provides new policy ideas and evidence. NAZCA endorses specific data-providing organisations; the World Bank supports C40 Cities through its urban programmes.

  3. (3) They use intermediaries to facilitate desired actions. The CTCN facilitates ambitious national policies by orchestrating experts to provide technology assistance. United for Efficiency and other UNEP-supported cooperative initiatives likewise provide technical assistance on specific topics. The World Bank works through the CIFs to provide climate finance and to encourage third-party co-financing. The NDC Partnership links governments with third-party sources of support and expertise. The MP encourages donors to support voluntary initiatives.

  4. (4) They promote coordination. Cooperative initiatives and other multi-stakeholder schemes facilitate coordination among participants. The Global Forum of Alliances and Coalitions promotes and facilitates coordination among initiatives. One rationale for the NAZCA portal is to disseminate information that reduces the costs for initiatives to coordinate. Overall, however, efforts at coordination have been more limited than those aimed at structuring the institutional complex.

Again, these actions utilise many orchestration techniques, including convening (Global Forum), persuasion (encouraging cooperative initiatives), reputational incentives (showcasing successes), ideational support (guidance, information) and steering (criteria, priorities, highlighting successes).

11.6 Conclusions: Enhancing Climate Orchestration
11.6.1 Orchestration Is Pervasive

Orchestration pervades climate governance. Many of the organisations in Figure 11.1 act as orchestrators: UNFCCC organs including the secretariat, presidencies and COP; UNEP, the World Bank and other IGOs and IFIs; the UNSG; and national governments. These international bodies lack authority for mandatory governance vis-à-vis states and private actors; even governments encounter limits to their authority when addressing transnational problems. International bodies also lack operational capacities and material resources – even the World Bank cannot provide all the needed climate finance. As orchestration research suggests (Abbott et al., 2015), these actors engage (and help create) intermediaries able to provide the capabilities they lack.

Not every actor can orchestrate successfully, but these actors have demonstrated sufficient agency and organisational competence to do so. Some have shown unexpected entrepreneurial flair. All possess substantial legitimacy and authority with relevant audiences, based on their institutional positions, expertise and moral leadership. Only the IFIs – notably the World Bank and the GEF – have committed substantial material resources; other orchestrators rely almost exclusively on convening authority, ideational support and reputational incentives.

11.6.2 Extending Climate Orchestration

For all its prevalence, however, climate orchestration falls short in certain areas: it has produced governance arrangements that are insufficient to meet agreed mitigation and adaptation goals, pose governance problems such as accountability (see Chapter 19) or simply fail to fulfil their potential. As mandatory governance remains unavailable, additional orchestration is the most feasible way to address these shortfalls. In this section I highlight four areas where extended orchestration would be valuable.

First, while a core proposition of polycentric governance theory asserts that polycentricity promotes experimentation and policy learning (see Chapters 1 and 6), the current system does not fully realise those benefits. The diverse actions taken under NDCs and the climate VCS offer unparalleled opportunities for experimentation and learning (Abbott, 2017). But the system produces only ‘informal’ experiments that do not follow the logic of experimentation in the natural and social sciences, and provides no systematic learning procedures. In addition, to pursue governance goals including speed and scale, the VCS adopts so-called SMART criteria, calling for specific, measurable, achievable and time-bound initiatives; these criteria encourage the application of established approaches, discouraging innovation and experimentation.

Climate orchestrators could encourage and support IGOs, governments and non-state initiatives to conduct designed, controlled experiments on technologies and policies (formal experiments), perhaps collaborating with natural and social scientists. At the least, they should encourage and support these actors to carry out their decentralised actions in ways that promote innovation and systematic learning (informal experiments). ‘Experimentalist governance’ offers one useful model (Sabel and Zeitlin, 2010), focusing on deliberation and peer review. An even stronger system would persuade, incentivise and support states and non-state actors to design and implement policies and interventions with an eye to experimentation and learning – adopting policies provisionally, coordinating their interventions to limit gaps and overlaps, defining important parameters to maintain comparability, keeping consistent records, disclosing results and engaging in systematic comparison and analysis of outcomes, with expert input where necessary (Abbott, 2017).

Orchestrators of the climate VCS could work through cooperative initiatives, local government associations and mechanisms such as the MP to encourage and facilitate these approaches among non-state actors; other orchestrators, such as UNEP, could work through independent initiatives. The UNFCCC could use the Article 13 transparency mechanism, the Technology Mechanism and other processes to promote them among governments.

Second, the MP aims to accelerate and enhance voluntary initiatives. Its broad strategies – catalysing action, tracking progress, showcasing and reporting – are laudable. But its techniques remain unclear (Chan et al., 2015; Chan, Brandi and Bauer, 2016). How can orchestrators effectively catalyse ambitious commitments, ratchet up their ambition, encourage financial support, promote Southern participation and ensure greater accountability? While a full discussion is beyond the scope of this chapter, the presidencies, champions, UNFCCC secretariat and UNSG should solicit advice from diverse stakeholders and experts, then design and implement a suite of concrete orchestration techniques to maximise the impact of the climate VCS.

Third, the Paris Agreement relies on NDCs, subject to periodic review and updating. The aim is to create a ratcheting dynamic, gradually increasing ambition. But review procedures are explicitly non-hierarchical and facilitative; effective orchestration is thus essential. Based on the foregoing discussion, an orchestration strategy might incorporate at least three elements. UNFCCC organs and leading governments should seek to embed influential intermediaries – e.g. IGOs, technical experts, finance providers, NGOs – into review processes, to facilitate action, introduce information and ideas and exert subtle pressures on governments (van Asselt et al., 2016). These and other orchestrators, such as UNSG, should mobilise diverse intermediaries to develop and provide willing governments information on cost-effective mitigation and adaptation strategies, with the ideational and material resources to implement them (Victor, 2016). Finally, orchestrators should ensure that ideas, information and evidence from the ‘groundswell’ of voluntary non-state initiatives are clearly communicated to governments in the context of decisions on NDCs, both for learning and for the political impact of their demonstration effects.

Fourth, while climate orchestrators have helped structure the institutional complex, as by encouraging initiatives of particular kinds, they have done relatively little to coordinate the actions of those initiatives. To encourage and incentivise efficient coordination among national government policies and NDCs, UNFCCC organs and other orchestrators could work through the Technology Mechanism, Technical Expert Meetings, CIFs and public-private cooperative initiatives, as well as regional bodies and other IGOs. They could introduce experts and other influential intermediaries into these processes to persuade and provide information and assistance.

For voluntary non-state commitments, cooperative initiatives may coordinate participants internally, but orchestrators of the climate VCS could more actively encourage them to do so, through MP criteria, the Global Forum and other processes. UNEP, with a mandate for coordination and close relations with many initiatives, could assume a larger coordinating role. The most ambitious vehicles for non-state coordination in environmental governance are the sustainable development action networks. Networks such as SE4All and Every Woman Every Child have developed substantial agency, coordinate participating initiatives by tracking progress and establishing priorities, and operate accountability mechanisms. Similar networks would be valuable additions to climate governance.

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12 Policy Surveillance Its Role in Monitoring, Reporting, Evaluating and Learning

Joseph E. Aldy
12.1 Introduction

Successfully mitigating the risks posed by climate change will necessitate substantial efforts by consumers, businesses and governments in nearly 200 countries to change their activities that are contributing to greenhouse gas (GHG) emissions. Doing so will require surmounting a collective action challenge; mitigating GHG emissions produces a global public good. Thus, the sources of these emissions have insufficient incentive to abate them (Barrett, 2003). In the multilateral sphere, there is uncertainty about the credibility of commitments, reflecting questions on whether a country can implement policies that alter the behaviour of private agents (e.g. emissions abatement) as well as questions on the ability to observe a country’s performance with respect to its commitment (Hafner-Burton, Victor and Lupu, 2012). Mitigation efforts at lower scales of governance – by states and provinces, businesses and even universities – have resulted in commitments to reduce emissions and implement mitigation policies (see Chapter 1). Such self-organised efforts may reflect how local impacts can drive lower-scale mitigation initiatives (Ostrom, 2010), but uncertainty also characterises the extent and efficacy of these efforts.

An extensive academic literature illustrates how transparency can reduce uncertainty and mitigate incentives to deviate from a commitment, and thus enable a set of reciprocal actions to deliver on a public good. This is all the more important given the prominent role of voluntary commitments emerging through various forms of governance, including the evolution of pledge-and-review in the international climate policy architecture. This highlights the needs and opportunities for a robust system of monitoring, evaluating and learning of mitigation performance; in short, climate policy surveillance.

Climate policy surveillance refers to the generation and analysis of information on the existence and performance of GHG mitigation policies and measures, such as emission levels and estimated reductions, costs and cost-effectiveness, potential cross-border impacts and ancillary benefits. In effect, the scope of an effective surveillance system would reflect the interests of various stakeholders and governments that demand information. This would require reporting and monitoring of relevant climate policy performance data, as well as the analysis and evaluation of those data. Doing so can facilitate learning about the efficacy of mitigation efforts and subsequently build trust that countries, subnational governments, businesses and others that have made commitments to combat climate change are delivering on them. This surveillance can be institutionalised in international agreements, but it can draw from the provision and analysis of data by national governments, businesses, civil society, academics and others. Polycentric climate policy surveillance can take two general forms: (1) transparency of a polycentric system of emission mitigation efforts; and (2) multiple, independent transparency efforts that may feed into a more centralised mitigation regime (e.g. the United Nations Framework Convention on Climate Change [UNFCCC]). These are not mutually exclusive, and the emergence of the former could influence the implementation of the Paris Agreement’s transparency regime.

Signalling the seriousness of commitment is often a condition for securing agreement among parties. Schelling (1956: 288) suggests that transparency and publicity of a party’s ex-ante pledge and ex-post outcome can enhance the credibility of commitments. The ‘publicity’ Schelling called for can be established by the ‘information structures’ created by the rules of international institutions (Keohane, 1998). The provision of information could also come from non-profit organisations, academics, business stakeholders and other non-state actors (Aldy, 2016a). Transparency can facilitate ‘naming and shaming’ by other parties to an agreement, by interested stakeholders, by the media and by others. The prospect of adverse reputational consequences for deviating from an agreement or a public commitment may promote compliance (Chayes and Chayes, 1991; Simmons, 1998). Even without an enforcement mechanism, information-generating institutions may ‘contain deviance within acceptable levels’ (Klabbers, 2007: 1004).

Barrett (2003: 150) notes that the ‘incentive for parties to deceive creates an incentive for others to monitor’. Indeed, any entity with an interest in ensuring that promised emission mitigation efforts are delivered has an interest in monitoring these efforts, as well as an incentive to experiment with alternative surveillance techniques (Ostrom, 2010). The probability of detecting deviations from an agreement increases with the transparency of the regime, which can thus reassure those predisposed to comply and deter those considering deviation (Levy, Keohane and Haas, 1993; Chayes, Chayes and Mitchell, 1998).

The iterative nature of multilateral climate negotiations provides an opportunity for transparency to inform subsequent rounds of negotiations. First, information can promote compliance in repeated games. In his discussion of monitoring in international environmental agreements, Barrett (2003: 284) notes that ‘transparency is of fundamental importance in a repeated game’. Levy et al. (1993) also note that ‘effective monitoring is a condition for sustained cooperation’. In economic policy contexts, Simmons (1998: 81) observes that ‘[g]reater transparency and opportunities for reciprocity also enhance compliance where there is repeated play within a small group, for example in the EU or among the large countries in the [World Trade Organization]’. In common pool resource management, Ostrom (1998: 10) emphasises that ‘all reciprocity norms share the common ingredients that individuals tend to react to the positive actions of others with positive responses and the negative actions of others with negative responses’. Second, structuring iterative negotiations around periodic information collection and analysis could inform the setting of goals and their implementation in subsequent rounds of negotiations.

Given the repeated nature of mitigation pledges envisioned under the Paris Agreement, verifying countries’ past performance can increase confidence and build trust that they will deliver on future rounds of pledges (Chayes and Chayes, 1991). Moreover, experimental evidence suggests that a transparency mechanism could increase both the ambition of pledges and the realised mitigation performance relative to a regime without review (Barrett and Dannenberg, 2016).

To deliver on the potential for global climate change efforts to attain the goals set in the Paris Agreement, however, climate policy surveillance will need to improve considerably. Section 12.2 discusses the experience with policy surveillance – and the substantial shortcomings – under the UNFCCC. The design of more effective climate transparency can benefit from the experiences implemented through various forms of governance in other, related contexts. Section 12.3 presents four mini-case studies of transparency practices: International Monetary Fund (IMF) Article IV consultations, the Group of 20 (G20) fossil fuel subsidies agreement, the US government’s retrospective review of regulations and industries’ voluntary reporting and disclosure through the CDP (formerly, the Carbon Disclosure Project). The selection of these case studies reflects an interest in: (1) illustrating transparency through a broad range of governance forms, from the multilateral to the business level; (2) drawing insights from reporting only as well as reporting subject to independent analysis schemes; (3) providing both positive and negative examples of review and surveillance; and (4) presenting examples of review schemes that each play at least a modest role in the existing structure of polycentric governance.

This chapter closes with a discussion of how monitoring, reporting and evaluation may in the future occur through more polycentric frameworks. In particular, it identifies opportunities for civil society, academics, business stakeholders and international organisations outside of the formal UNFCCC process to contribute to and enhance the rigour, accountability and legitimacy of policy surveillance. These conclusions emphasise complementarities in policy surveillance at different levels of governance – some of which have self-organised in the vacuum created by the weak UNFCCC transparency regime – as well as how other institutional approaches could address gaps in the multilateral climate transparency regime.

12.2 Shortcomings in Climate Policy Transparency

The opportunities for polycentric transparency and policy surveillance to make valuable contributions to climate policy reflect, in part, the shortcomings in multilateral climate policy transparency. The infrequent reporting of emissions, the incomplete information on mitigation policies and the absence of analysis and review of emission outcomes and policies have characterised the UNFCCC since the early 1990s (Aldy, 2014a, 2016b). The Convention established vastly different standards for reporting on emissions and national policies for industrialised (Annex I) countries and developing (non-Annex I) countries. In the first two decades of the UNFCCC, most developing countries had presented no more than two emission inventories (Breidenich and Bodansky, 2009). For example, China submitted information on its GHG emissions inventory for 1994 in its 2004 national report, and for 2004 in its 2012 national report. A once-per-decade snapshot of emissions, with nearly a decade-long reporting lag, is clearly inadequate to inform negotiations, policy design and investment decisions.

Developed countries submit annual emission reports, pursuant to established guidelines subject to expert review. By contrast, the infrequent developing country emission reports submitted before 2014 were neither subject to the same standards as developed countries nor underwent expert review (MacFaul, 2006; Breidenich and Bodansky, 2009). Even the regular reporting of developed country emissions was insufficient to characterise the effectiveness of emission mitigation policies in these countries (Thompson, 2006a; Ellis and Larsen, 2008; Breidenich and Bodansky, 2009). The reviews of industrialised countries typically draw, in an ad hoc nature, from government-sponsored experts (academia, business and government sectors) to conduct a review, with occasional in-country visits. The pre-2014 developed country national reports were so incomplete and inconsistent that it was not possible to credibly assess the impacts of mitigation policies across countries or even compare efforts within a country over time (Thompson, 2006a; Aldy, 2014b; Ellis and Moarif, 2015).

Given the poor track record on climate transparency, the multilateral community has aimed to enhance reporting and review. The Copenhagen Accord and Cancún Agreements included a variety of mitigation pledges, such as emissions targets relative to a base year, emission reductions relative to a business-as-usual forecast, improvement in the emission-to-gross domestic product ratio, as well as sector-specific policies and goals. While this heterogeneity of pledges may facilitate broader participation (also evident in the Paris Agreement), it may present challenges in assessing and comparing mitigation efforts absent in a robust transparency regime. These two agreements required biennial reports by developed countries and biennial update reports by developing countries (Ellis and Moarif, 2015). These reports feed into a consultative process for peers to discuss individual nations’ domestic emission mitigation programmes. Again, the standards differ considerably between developed and developing countries. The Annex I nations have standardised reporting templates and all met their initial deadline of December 2013 for biennial update reports. By contrast, non-Annex I countries have substantial discretion in what and how information is presented in their reports, which undermines comparability. More importantly, the compliance with the due dates for the biennial reports has been low. By December 2016, the due date for the second biennial update reports, less than one-quarter of all developing countries had submitted their first biennial report (UNFCCC, 2017). China submitted its first report in 2017.

The Paris Agreement calls for further transparency efforts by building on these efforts. Significant improvements in policy evaluation will be necessary. This will be a challenge, given that some developing countries lack the institutional capacity to monitor emissions, evaluate programmes and policies, estimate emission reductions across various sources and sectors and report this information. For example, the 2013 United Nations Environment Programme Emissions Gap report notes that ‘serious information gaps preclude comprehensive assessment of several countries’ emission trajectories under current policies (UNEP, 2013: 12). Likewise, Ellis and Moarif (2015: 4) conclude that the ‘lack of complete and/or timely information from a large number of countries prevents assessments of progress towards collective commitments or goals’. Moreover, UNFCCC reviews of developed country emission mitigation programmes have provided little useful information about policy efficacy as well as lessons and/or recommendations for policy export to other nations. The credibility and trust necessary for the Paris pledge-and-review framework to deliver more mitigation ambition over time will depend on countries understanding not only their peers’ emission levels but also the impacts of the mitigation policies and programmes. This kind of policy evaluation could benefit substantially from inputs and contributions from non-UNFCCC processes. The next section presents several case studies and from them derives lessons for how a more polycentric approach to transparency could address these needs.

12.3 Surveillance in Action: Insights from Four Case Studies

This section briefly describes each of the four transparency case studies. The following section synthesises the key lessons learned from them.

12.3.1 International Monetary Fund Article IV Consultations

The IMF undertakes country-, regional- and global-level economic surveillance (IMF, 2001; Schäfer, 2006). Individual country surveillance occurs annually under so-called Article IV consultations. The IMF conducts regular surveillance of the global economy – in effect, an assessment of the aggregate impact of various economic, monetary and fiscal policies of the member countries – and publishes the World Economic Outlook typically twice per year. While these reviews focus on economic policy, they have occasionally addressed climate-related policy reforms, such as fossil fuel subsidies (IMF, 2011).

The IMF consultations have enhanced monitoring and analysis capacity within countries, produced economic data for review and enabled policy review. As a result, scholars focused on climate policy have considered the IMF review as a gold standard worthy of emulation in the climate context. For example, Victor (2007) called for a climate change review mechanism based on the IMF model. Aldy (2013) also suggested that a formal institution with permanent staff could implement a transparency mechanism for the global climate policy regime. Such an institutional capacity could provide confidence in the review mechanism as a function of its credibility, competence and independence.

12.3.2 G20 Fossil Fuel Subsidies Agreement

At the 2009 Pittsburgh G20 summit, the leaders of the 20 largest economies agreed to ‘phase out and rationalise over the medium term inefficient fossil fuel subsidies while providing targeted support to the poorest’ (G20, 2009). The G20 leaders called on all nations to eliminate their fossil fuel subsidies, and Asia-Pacific Economic Cooperation leaders echoed the call to phase out such subsidies at their 2009 Singapore summit (Aldy, 2017).

Following up on the G20 agreement, leaders established processes of implementation and review to promote such transparency. Leaders tasked energy and finance ministers to identify their nations’ fossil fuel subsidies, develop a plan for eliminating these subsidies and report to leaders on their progress. The G20 published a summary report of each member’s identified subsidies and the plan for eliminating them at the 2010 G20 summit. Leaders have continued to task energy and finance ministers to continue their efforts and report back regularly (e.g. G20, 2013b). Several G20 governments have also voluntarily subjected their subsidy phase-out performance to a formal peer review process. In 2016, the G20 reported on the China and US peer review efforts (OECD, 2016a, 2016b).

12.3.3 US Government Retrospective Review of Regulations

In January 2011, President Obama issued Executive Order 13563, ‘Improving Regulation and Regulatory Review’. This called for, among others, retrospective analyses of existing significant regulations. The president called on regulatory agencies to ‘consider how best to promote retrospective analysis of rules that have become outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned’ (Section 6). Under the Executive Order, each regulatory agency published a plan for periodic review of existing significant regulations and began evaluating their rules in the summer of 2011.

The Obama administration aimed to institutionalise retrospective review of regulations after ad hoc regulatory look-backs implemented at the behest of the White House in every previous administration since the 1970s (Aldy, 2014a). The United States is not alone; a number of other developed countries have also pursued retrospective review of their regulations (OECD, 2009; European Commission, 2014). These efforts represent a national-level form of self-surveillance. In the US government, federal regulators had the sole authority to initiate and undertake the review of their existing rules.

12.3.4 Voluntary Firm Reporting through the CDP

The CDP, initially launched in 2003, collects and publishes information on companies’ climate change-related activities (Matisoff, Noonan and O’Brien, 2013). This includes data on company efforts to mitigate exposure to climate change risks, company GHG emissions and emission-abatement efforts and internal carbon pricing for project and investment evaluation. The CDP is a non-profit organisation, initially launched by major institutional investors, that operates around the world and aims to address the demand for information about companies’ environmental-related outcomes from investors (Hahn, Reimsbach and Schiemann, 2015).

Each year, the CDP publishes a report that synthesises and analyses the climate-related data voluntarily reported by major companies (CDP, 2016). In addition, in recent years, the CDP has expanded to include reporting by cities on their climate-related activities. This reporting enables those who demand the information to assess and compare climate change actions by region, by industry and by other characteristics of business.

12.4 Lessons from Polycentric Transparency
12.4.1 Producing Credible Information

Producing credible data and analysis can enhance the legitimacy and facilitate trust in the policy surveillance. As Thompson (2006b) notes, national governments have frequently delegated surveillance responsibilities to international organisations, and these entities can play important roles by generating ‘neutral’ information. The IMF and G20 models both rely on international organisations for implementing policy surveillance.

Under Article IV consultations, teams of permanent staff experts make in-country visits as part of policy and data reviews (IMF, 2001; Schäfer, 2006). These expert teams use country-provided data, among other sources, in their review of a country’s economy and relevant economic policies. After a country visit, the IMF expert team compiles a report that feeds into a peer review process (see Section 12.4.2).

To facilitate transparency of the fossil fuel subsidies agreement, the G20 leaders tasked four international organisations – the International Energy Agency (IEA), the Organisation for Economic Co-operation and Development (OECD), the Organization of the Petroleum Exporting Countries (OPEC) and the World Bank – to evaluate fossil fuel subsidies. This includes an examination of countries’ subsidies, their proposed subsidy reforms and the economic, energy and environmental impacts of these subsidies. These international organisations published their first joint report to G20 leaders at the 2010 Toronto meeting and have continued to provide analysis and reviews of countries’ implementation strategies (IEA, OECD and World Bank, 2010). In addition to these joint reports, the IEA (2013), the OECD (2013) and the IMF (2013) have produced their own estimates of country-specific fossil fuel subsidies.

Drawing from experts among various international organisations to evaluate fossil fuel subsidy reforms mirrors the approaches taken by the IMF, the OECD and the World Trade Organization (Aldy, 2013, 2014b). Relying on external experts at established international organisations also mitigates concerns about the politicisation of the transparency mechanism and allows for a rapid ramping up of the review process. A potential limitation of relying on existing international organisations, however, may be the legitimacy of those with incomplete memberships. For example, some developing countries may question reviews by the IEA, whose membership is comprised of predominantly developed nations. Others may challenge the legitimacy of the IMF because of the greater weight that larger, more developed economies have in its decision-making, hiring and operations (IMF, 2017).

By contrast, the retrospective review of regulations in the US government requires regulators to review their own rules. Given the scarce resources, agencies have the discretion to identify rules for review, determine the nature and detail of analysis and make the final decision about changes to existing rules. Likewise, the firms disclosing through the CDP are subject to selection. Moreover, their reporting is not reviewed independently. As a result, such processes, absent supplemental review, may raise questions of credibility and legitimacy. In a polycentric world, however, they could enhance information in broader climate transparency schemes. For example, ex-post review of the performance of a carbon dioxide mitigation regulation could serve as an input in a country’s reporting and review under the Paris Agreement’s transparency regime (Aldy, 2016a).

12.4.2 Engaging Peers

Providing a forum for countries to engage one another through peer review can facilitate learning about effective policy practice and promote mutual understanding about individual policy designs and experiences of implementation. The IMF expert staff report serves as the basis for a peer review by the Executive Board, which includes 24 country directors representing member countries or groups of countries. A summary of the Board discussion and the report are typically published. Making these reports public enables stakeholders to push for better economic policies in their respective countries and improves the quality of the IMF review product by effectively subjecting the reviewers to external assessment (Fischer, 1999).

Coupling peer review with expert review enhances transparency on implementation and can empower domestic stakeholders as well as peer nations to apply pressure to push a country to deliver on its commitment. At the 2013 G20 summit, leaders supported broad participation in a voluntary ‘country-owned’ peer review of fossil fuel subsidy phase-out efforts (G20, 2013a). Through this process, small groups of G20 nations work together in reviewing one or more nations within each group that voluntarily submit their policies for review (G20, 2013b). Third-party experts (e.g. from the OECD) and non-G20 countries may participate in the reviews at the reviewed country’s discretion. The peer review addresses the fossil fuel subsidies identified for phase out by the country under review. A reviewed country may agree to a broader assessment, including analysis of other potential subsidies, barriers to subsidy reform, etc. Initiated in 2014, the first round of peer reviews addressed China and the United States (OECD, 2016a, 2016b), and the second addressed Germany and Mexico.

The G20 agreement explicitly invites non-G20 countries to follow suit in eliminating their fossil fuel subsidies and provides an opportunity for non-G20 members to participate in peer review. For example, the Friends of Fossil Fuel Subsidy Reform – including Costa Rica, Denmark, Ethiopia, Finland, New Zealand, Norway, Sweden, Switzerland and Uruguay – participate in the G20 peer review process. Learning about effective reform efforts can then spill over to countries outside of the G20. Policy surveillance in an open club framework promotes the dissemination of information and knowledge – a public good that could benefit club members by leveraging subsidy reform outside of the club, i.e. de facto opt-in to the fossil fuel subsidies agreement (Victor, 2007).

12.4.3 Enhancing Capacity

The IMF supports standards for data dissemination and codes for good policy practice that can facilitate surveillance and also benefit member countries in their design and implementation of economic policy. Such standards provide transparent, timely and measurable metrics for evaluating policy performance and identifying potential economic vulnerabilities. The IMF emphasises the value in implementing such standards and codes to communicate clearly to the markets and other countries on a country’s economic situation.

In the context of the retrospective review of government regulations, building capacity and increasing experience in conducting analyses of regulatory performance can create a ‘culture’ for review (Sunstein, 2012). Creating such a culture can change the pattern of periodic, ad hoc retrospective reviews (Coglianese, 2013). The institutionalisation of retrospective review, especially with regular reporting, helps promote that culture.

A critical element of building a culture for review lies in planning for review when developing new regulations. Some regulations are difficult to evaluate through rigorous statistical methods, as evident in the academic literature on the costs, benefits and impacts of federal regulations (Aldy, 2014a). This may reflect the absence of necessary data, time, resources and bureaucratic capacity to undertake a feasible analysis or an implementation that does not naturally lend itself to causal identification. Planning for ex-post analysis of a rule could ensure both the availability of such data and an implementation scheme that may permit causal inference on the impact of the rule. The Department of Homeland Security indicated that it would ‘build in retrospective review at the earliest stages of regulatory development’ (Aldy, 2014a: 61). The Departments of Labor, the Interior and Treasury indicated an interest in experimental designs to facilitate rigorous statistical evaluation of their regulatory actions (Sunstein, 2011). Such an analysis could help address key questions the public may have, such as whether the rule was successful (Coglianese, 2013). Nonetheless, none of the significant regulations promulgated by regulatory agencies in the first three years of the Obama retrospective review effort included plans for their future performance evaluations (Aldy, 2014a).

12.4.4 Facilitating Policy Learning

An effective transparency mechanism not only collects information but also provides analysis and evaluation of policy actions and outcomes. Analysing and disseminating data on countries’ actions under an agreement are necessary for transparency to contribute to regime compliance (Chayes et al., 1998).

In addition to providing templates for analogous work in the climate context, Article IV consultations can improve the information set about the climate impacts of economic policy reforms. For example, the IMF reported on the impacts of Iran’s major 2010 fuel pricing reform in its 2011 Article IV consultation. In this analysis, the IMF stated that the dramatic reduction in fuel subsidies (Iran quadrupled the price of petrol on one day) had reduced emissions of carbon dioxide as well as nitrogen oxides, sulphur oxides and particulate matter (IMF, 2011).

One of the key motivations for targeted, small-group efforts is to identify actions and processes that can successfully lower GHG emissions. A well-designed transparency regime can provide the information necessary to demonstrate whether the small-group process delivered on its objectives. It can illustrate the most effective reforms and highlight potential opportunities for scaling up the effort to a larger set of countries or even to the full UNFCCC negotiations. Working in a smaller group of similar countries may permit a more extensive system of policy surveillance. For example, the G20 members have substantially more resources and bureaucratic competency than the average of the UNFCCC membership. Thus, G20 members can draw on the technical expertise of their bureaucracies – and in some cases their civil society and academia – to experiment with ideas for effective policy surveillance. Demonstrating a well-functioning system of policy surveillance for the largest developed and developing countries can then serve as a model for large-group contexts such as the UNFCCC.

Retrospective review can increase the efficiency of regulations by reducing regulatory duplication, which has been an objective of retrospective reviews dating back to the 1978 Carter Executive Order and the 1980 Regulatory Flexibility Act. This is all the more important today, as agencies – such as the Environmental Protection Agency, the Department of Energy and the Department of Transportation – deal with various overlapping jurisdictions.

Improving multi-agency coordination would help address these issues of duplication and also better identify the cumulative extent of regulatory burdens borne by regulated entities. This can also be important as the United States works to better coordinate regulatory policy with other major trading partners. Each country is different in how it allocates regulatory responsibility to various agencies within its government, and thus regulatory coordination and coherence on any specific set of regulatory issues will likely involve multiple regulatory agencies in each country. With an increasing number of countries undertaking some form of retrospective review of regulations (OECD, 2009), there may also be opportunities for US government agencies to coordinate with overseas counterparts on retrospective review and hence potentially learn from other countries’ regulatory agencies. For example, the European Commission is implementing the Regulatory Fitness and Performance Programme, which ‘aims to cut red tape, remove regulatory burdens, simplify and improve the design and quality of legislation so that the policy objectives are achieved and the benefits of EU legislation are enjoyed at lowest cost and with a minimum of administrative burden’ (European Commission, 2014: 2).

While governments craft climate policy, businesses and consumers will undertake the changes in behaviour and investment necessary to abate GHG emissions. The CDP reports provide ground-level evidence of corporate mitigation projects and outcomes and illustrate opportunities for learning from business peers. Moreover, they can enable policymakers to calibrate their assessments of climate change policy and determine if they are delivering on their desired results. Finally, business-level climate transparency can corroborate and complement transparency by governments in those regions where a given business operates (CDP, 2016).

The business reporting through the CDP can also signal private-sector expectations about the future of climate change policy. The nature of emission mitigation investments as well as the internal carbon price for planning reveals the expected effective carbon price influencing the returns to the business’s operations. In its 2016 report, the CDP noted that more than 1,000 companies use or plan to soon use a carbon price for internal project evaluation and investment analysis. For example, large American corporations, including Duke Energy, General Motors, Google and ExxonMobil; large Asian corporations, including NEC, Samsung, TEPCO and Toto; and large European corporations, including BMW, BP, Deutsche Bank and Unilever, employ carbon prices in internal planning ranging from 5 to 100 per tonne of carbon dioxide. Formally integrating a carbon price in the assessment of business options reflects an expectation that policies of one form or another will impose an explicit carbon price (e.g. a carbon tax) or an implicit carbon price (e.g. through command-and-control regulation) on these companies’ business operations. The dramatic heterogeneity in expected carbon prices among these companies, however, also reflects the continued uncertainty about the form, timing and ambition of international climate change policy after Paris (Aldy, 2016b).

12.5 Conclusions

Let me close with a discussion of the demand and supply for transparency, and the opportunities – indeed the need – for a polycentric approach to transparency.

Transparency reflects the demand for information, which will be a function of the interests of all those engaged, one way or another, in climate policy. Governments may request the collection, analysis and dissemination of information through the transparency mechanisms that address the interests of their domestic publics and stakeholders (Aldy and Pizer, 2016; Aldy et al., 2016). Some business stakeholders may view transparency as a way to assess the policy and economic landscape in a given country for purposes of determining future investments. Other business stakeholders, concerned about potential adverse competitiveness impacts of the domestic programmes they operate under, may be interested in assessing the comparability of mitigation effort among countries, with a particular focus on the energy-cost impacts of domestic mitigation programmes borne by their competitors (Aldy and Pizer, 2015). Environmental stakeholders may use assessments of a country’s mitigation programme and comparisons with other countries to identify and pressure laggard countries. Addressing these interests will require information on the economic, energy and environmental impacts of domestic mitigation policies.

The Paris Agreement acknowledges the substantial interests in transparency by tasking the development of a policy surveillance mechanism to future negotiations (see Chapter 2). The track record of climate transparency in the UNFCCC processes to date suggests that the supply of transparency will be inadequate. Will the information be credible? Will there be sufficient analysis to address the most important questions? Will there be enough investment in the institutions to enable learning among peers? Will countries have the capacity to produce and consume information on climate policy performance? Failing to identify key policy insights will retard the development of more effective mitigation policies around the world. Drawing lessons from existing schemes of transparency can inform the supply of these necessary elements and processes of policy surveillance.

There may be, however, novel sources for information that can be tapped. The Paris Agreement emphasises the potential role of so-called non-party stakeholders – including civil society, the private sector, financial institutions and subnational authorities – in a markedly more open and positive manner than previous multilateral climate agreements (see Chapter 4). The decision adopting the Paris Agreement specifically calls for leveraging the expertise and knowledge of non-party stakeholders to complement the contributions of parties, convention bodies and international organisations in the existing technical review processes of pledges through 2020. Soliciting ‘experiences and suggestions’ creates an opportunity for stakeholders to inform, shape and demonstrate approaches to transparency that can facilitate greater mitigation over time (UNFCCC, 2015: para. 109). Moreover, the decision reiterates this enthusiasm for non-party stakeholders by noting that it ‘encourages non-party stakeholders to increase their engagement’ (UNFCCC, 2015: para. 119). Finally, the decision focuses on the role of domestic mitigation policies and carbon pricing, suggesting that stakeholders could play a role in integrating the design of domestic policy, the review of these policies and the implications for the transparency and assessment of mitigation pledges under the Paris framework. Non-party stakeholder experimentation with alternative transparency approaches may also identify more effective surveillance design (Ostrom, 2010).

Indeed, interest in domestic mitigation policies and actions is likely to continue to grow as parties and stakeholders seek a better understanding of how parties’ nationally determined contributions are implemented and how far implementation delivers on a given country’s initial pledge. Stakeholders often have more extensive input on the design and evaluation of domestic policy, including mitigation policy, than on a headline goal made in multilateral negotiations. Understanding what policies will work in practice can draw from stakeholder expertise. In addition, stakeholders can work with policymakers on the design of domestic policy to facilitate the supply of information for the benefit of both domestic policy review and international climate policy transparency (Aldy, 2016a). This can improve the efficacy of domestic policies, promote cost-effectiveness, enable greater policy learning and enhance the credibility of a country in international negotiations by rigorously demonstrating a good faith effort in mitigating GHG emissions (van Asselt and Hale, 2016).

A challenge in a polycentric approach to climate change policy lies in the prospect that the emerging climate change regime may include some redundancies in promoting emission mitigation as well as some omissions. These may simply reflect the lack of complete coordination among the various efforts to address climate change, but it could also be an outcome of strategic incentives and interactions (Gunningham and Sinclair, 1999; Ostrom, 2010). Just as there are free-riding incentives in the mitigation of GHG emissions by any individual source or country, the same can hold for polycentric mitigation efforts. If a small group of countries or an industry or major donor institution advances mitigation efforts, that risks weakening the incentive – and potentially the political resolve – to take action in other domains. In effect, there could be substitution among polycentric mitigation activities. This is not necessarily the case, but absent thoughtful coordination, this substitution could easily occur.

By contrast, the public good nature of providing information means that a polycentric approach to transparency could create strategic complementarities. If one regime enhances its transparency – such as businesses revealing information about their climate-related activities, including their emissions, internal carbon price for project planning, and changes in carbon-related investment – then that may lower the cost of undertaking transparency in a related regime – such as a retrospective review of domestic emission mitigation regulations, which could calibrate models of policy efficacy based on the business disclosures. Likewise, lowering the costs of national policy surveillance would increase the supply of information into plurilateral and multilateral transparency regimes. Thus, making commitments to transparency in the evolution of a polycentric climate policy complex could make it that much easier to improve the quality and usefulness of information going forward. Furthermore, given the critical role of learning about emission mitigation performance to build trust in global climate policy efforts as well as to identify and export efficacious policies in promoting more ambitious climate change policy, leveraging the strategic complementarities in polycentric transparency can contribute to a more successful global climate policy effort.

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