Stakeholder engagement as a conduit for regulatory legitimacy?

Abstract

Stakeholder engagement practices are on the rise in regulatory governance. This raises an important question regarding implications for regulatory legitimacy. Engagement mechanisms are not by default legitimizing: Even when initiated to tap into an array of ‘benevolent’ desiderata, unless carefully balanced and built-for-purpose, they can become conduits for de-legitimation. Much like Schrödinger’s cat, neither dead nor alive, so too can stakeholder engagement be, in principle, a source of legitimation and de-legitimation. We suggest three distinct sets of explanatory factors to assess the (de-)legitimizing nature of stakeholder engagement: contextual determinants, the institutional design of specific engagement arrangements, and organizational rationales and individual preferences. Taken as a whole, the documented broadening and deepening of engagement in regulatory governance, points at a more encompassing transition of the regulatory state, away from its traditional legitimizing tenants. Unless carefully tailored, this transition risks eroding the distinguishing features that underpin the regulatory state’s very claim to authority. We highlight that addressing contemporary societal challenges and many of the regulatory conundrums associated with them calls simultaneously for independent expertise necessarily grounded in the much-needed (but carefully-balanced) audience support that sustains regulatory authority.