Title: Public Problems, Private Answers: Reforming Industry Self-Governance Law for the 21st Century
Abstract: For the past twenty years, large corporations have routinely developed and enforced industry-wide standards to address problems that are only distantly related to earning a profit. This includes writing detailed private regulations for environmental protection, national security, working conditions, and other topics formerly reserved to governments. At the same time, the US Supreme Court has said that the Sherman Act forbids any “extra-governmental agency” that “provides extra-judicial tribunals for the determination and punishment of violations.” This seems to ban enforceable rules. Despite this, many US policymakers continue to argue that private standards are efficient and desirable. Many corporations are sympathetic but fear legal liability and are reluctant to participate unless and until the law is clarified.