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Disclosure and compliance: The 'pillory' as an innovative regulatory instrument

Disclosure and compliance: The 'pillory' as an innovative regulatory instrument Enforcement agencies increasingly use disclosure as a regulatory instrument to promote compliance and govern societal risks: data about companies are disclosed to expose their level of compliance. This innovative instrument, called the 'pillory', differs from traditional instruments such as financial incentives ('the carrot'), legal sanctions ('the stick') and government communication ('the sermon'). The 'pillory' aims to inform and activate the stakeholder environments of companies and, in so doing, encourage them to push for better compliance. Based on case studies of the National Veterinary and Food Administration, the British Environment Agency and the Dutch Provincial Environmental Inspectorate, this article attempts to determine the conditions under which Internet-mediated disclosure contributes to the moderation of societal risks. It is concluded that inspectees (businesses, supervised organizations) are sensitive to reputational damage even though they are seldom confronted with the visible actions of stakeholders. Disclosure affects the behavior of 'small offenders', who care about their reputations, more than that of 'large offenders', who only react to harsh measures. The 'pillory' is a useful instrument, even though serious offenders still need to be punished with 'the stick'. In the reflection, we argue that the rise of this innovative regulatory instrument can be attributed to the availability of technology and the changing role of government in a network society. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Information Polity IOS Press

Disclosure and compliance: The 'pillory' as an innovative regulatory instrument

Meijer, Albert J.; Homburg, Vincent
Information Polity , Volume 14 (4) – Jan 1, 2009
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Publisher
IOS Press
Copyright
Copyright © 2009 by IOS Press, Inc
ISSN
1570-1255
eISSN
1875-8754
DOI
10.3233/IP-2009-0191
Publisher site
See Article on Publisher Site

Abstract

Enforcement agencies increasingly use disclosure as a regulatory instrument to promote compliance and govern societal risks: data about companies are disclosed to expose their level of compliance. This innovative instrument, called the 'pillory', differs from traditional instruments such as financial incentives ('the carrot'), legal sanctions ('the stick') and government communication ('the sermon'). The 'pillory' aims to inform and activate the stakeholder environments of companies and, in so doing, encourage them to push for better compliance. Based on case studies of the National Veterinary and Food Administration, the British Environment Agency and the Dutch Provincial Environmental Inspectorate, this article attempts to determine the conditions under which Internet-mediated disclosure contributes to the moderation of societal risks. It is concluded that inspectees (businesses, supervised organizations) are sensitive to reputational damage even though they are seldom confronted with the visible actions of stakeholders. Disclosure affects the behavior of 'small offenders', who care about their reputations, more than that of 'large offenders', who only react to harsh measures. The 'pillory' is a useful instrument, even though serious offenders still need to be punished with 'the stick'. In the reflection, we argue that the rise of this innovative regulatory instrument can be attributed to the availability of technology and the changing role of government in a network society.

Journal

Information Polity – IOS Press

Published: Jan 1, 2009

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