Risky business: engaging with regulated stakeholders

This paper examines how in a risk-based regulatory environment policy approaches are co-created with regulated stakeholders, as such approaches are interpreted and translated into strategies and actions through decision-making... [ view full abstract ]

This paper examines how in a risk-based regulatory environment policy approaches are co-created with regulated stakeholders, as such approaches are interpreted and translated into strategies and actions through decision-making processes. What emerges from the research findings is that whilst risk-based regulation is an established means of addressing regulatory problems, other contextual factors such as the broader simultaneous adoption of New Public Governance (NPG) principles of participation and pluralism impact the decision-making processes of regulatory agencies. Those making strategic decisions in regulatory agencies occupy a unique position, influencing and being influenced by agency, polity and policy. This positioning highlights the inherent tensions in dealing with competing demands for regulator attention to the shifting perceptions of risk, and the ensuing contradictory message about what is important. These tensions derive in large part from particular aspects of engaging with regulated stakeholders. Responsiveness to stakeholders sets up tension over time which pull the regulators in different directions, and in some cases, dictates different outcomes for strategic decisions as trade-offs are extracted in the decision-making process. This paper argues that involvement of regulated stakeholders in the co-creation of strategic decisions both facilitates and inhibits the adoption of risk-based approaches.