Regulatory Diplomacy: The Practitioner’s Path to Agility and Foresight

This guest editorial for the ANZSOG-auspiced National Regulators Community of Practice (NRCoP) has been written by Rob Warner, Chief Advisor Strategy, Maritime New Zealand and Dr Grant Pink, RECAP Consultants and Pracademic Advisor to the NRCoP

As regulatory practitioners, we’ve all felt the increasing complexity and pace of the challenges coming across our desks and confronting us in the field. Whether it’s overseeing innovation, governing risks, or getting ahead of emerging threats – the issues we face are increasingly borderless and rapidly evolving. For this reason, fragmented, go-it-alone approaches are less and less likely to be appropriate and/or tolerated in this hyper-connected and inter-dependent world.

What is Regulatory Diplomacy?

Regulatory Diplomacy is a concept that can be used as part of:

‘actively shaping global regulatory frameworks, raising standards internationally and influencing global norms through international relationships and influence. … [In order to] help to solve problems that require a global approach’.[i]

As such, regulatory diplomacy has become a critical part of a regulator’s core toolkit. At its heart, regulatory diplomacy is about forming and mobilising international networks that allow us to connect, coordinate, and problem-solve alongside our counterparts worldwide. These channels provide a powerful paradigm for navigating the uncertainty together with others. They enable leveraging collective capabilities and experience, to help ensure our organisations remain fit-for-purpose for the ‘now’, and ready for what might come in the ‘near’ and ‘next’ operating horizons.

In our ANZSOG editorial on Navigating Regulatory Landscapes: Four Sights to advance regulatory practice and governance [ii] we laid out a framework that gets to the heart of why diplomatic approaches are helpful. The framework champions the AAA trifecta: Anticipatory, Agile and Adaptive as organisational postures that assist regulators to be more resilient and future ready. Regulatory diplomacy can enable each of these postures. Further, a mix of formal and informal networks across jurisdictions helps provide resilience and can extend capability in times of strategic uncertainty, and can form part of the early warning systems that a regulator can establish and access to detect signals of change rippling through globally, regionally and domestically.

Through dialogue and exchange of perspectives with likeminded regulators (or even not so likeminded, so as to avoid ‘group think’) that reside beyond our borders – regulators can gain or improve the situational awareness to anticipate emerging issues and risks at the earliest possible stage. Those faint and early signals can lead to or become clear patterns when we pool information, intelligence, and insights across borders. This foresight positions us to be proactive, getting ahead of risks or problems before they manifest locally.

The NESTA report [iii] Renewing regulation – ‘Anticipatory regulation’ in an age of disruption reinforced this urgency, especially when it comes to governing exponential technological change. We need global regulatory networks providing that continuous horizon-scanning to develop truly future ready policy frameworks, that can be operationalised. Standalone efforts will almost always leave us a step behind.

Diplomatic channels don’t just enhance foresight – they can also turbocharge our ability to adapt our approaches based on lessons learned across contexts (whether shaped at a continent scale or commodity level). Within these networks, we can gain access to insights about what works, what doesn’t work, and where any pitfalls might be. Importantly these insights are based on the lived experiences of peers who have faced or are facing similar challenges. We can absorb those learnings, reflect and refine our own policies and practices in a much more agile fashion.

Perhaps most powerfully, regulatory diplomacy enables collaborative innovation and experimentation in a way siloed domestic efforts simply cannot match. Our regulatory counterparts across these networks are pioneers too, piloting novel approaches like regulatory sandboxes, and regulatory stewardship to test and update oversight models. By joining forces, we have the potential multiply our speed of iteration, learning, implementation, and adaptation.

This cycle of co-creation, joint testing, shared evaluation, and continuous refinement allows us to develop pragmatic, localised regulatory innovations tailored to our unique on-the-ground realities. We can elevate our regulatory agility exponentially by moving forward in disciplined formation, all of which assists with achieving or advancing regulatory outcomes.

However, making, maintaining, and sustaining trusted global connections, contacts, and circuits to bridge diverse legal systems, operating environments, and/or cultural nuances won’t always be easy. Having a good understanding of context and building a solid backdrop for engagement is key. Useful and sustainable relationships for effective regulatory diplomacy take work and thoughtful relationship maintenance and management – but the potential payoffs are simply too impactful to ignore.

At its core, regulatory diplomacy provides a useful evolutionary path towards more resilient, future ready stewardship models that are fit for our hyper-connected era and inter-dependent world. Regulatory diplomacy is an ethos of enhanced foresight, continuous adaptation, joint problem-solving, and coherent international networks to promote the critical public interests we’re all committed to protecting.

Perhaps most crucially, regulatory diplomacy affords opportunities for collaborative experimentation, iterative learning, and continuous improvement. Within this ecosystem of open dialogue and mutual understanding, regulators can pilot innovative regulatory approaches within their respective jurisdictions and regulatory domains, continuously refining and optimizing their methods based on shared learnings. This iterative cycle of trial, evaluation, and adaptation allows regulatory regimes and corresponding regulatory practices to evolve in lockstep with the realities they seek to govern, promoting greater agility, responsiveness, and long-term resilience.

The 4C’s of Regulatory Diplomacy

© Rob Warner & Grant Pink (2024)

CONTEXT: Know what you are Seeking

Set a direction for discovery, be clear and intentional – before diving in, understand the specific regulatory environment you’re dealing with and where new perspectives may bring the most mutual benefit. Consider cultural norms, existing frameworks, and potential challenges.

Think about what you are working with, do your research – consider what matters, analyse relevant policies and background information, conduct consultations, and try to understand the needs of all involved parties.

CONTACT: Build Bridges, Not Walls

Imagine reaching out and making that first approach – establish an initial communication pathway with your regulatory counterparts. Open doors for dialogue, fostering understanding and building trust.

Think introductions, information exchange and invitation – share regulatory frameworks, situational awareness and identify areas of potential collaboration.

CONNECT: From Talk to Teamwork

Imagine a brainstorming session that creates meaningful connection – move beyond basic contact. Explore shared goals, identify common challenges, and brainstorm solutions together.

Think joint sense-making workshops and capacity building – develop programs that address mutual concerns, fostering a spirit of teamwork.

COLLABORATE: Act for Synergy, Setting up for Success

Imagine a symphony that is well set up and can be scaled – combine strengths and expertise to achieve more together. Develop moments of bilateral ad multilateral collaboration that benefit could all parties.

Think joint initiatives and mutual value building – identify ways to streamline processes, ‘take rather than make’ solutions, and regulatory approaches that could transcend across borders.

Conclusion

The 4C’s: Context, Contact, Connect, Collaborate – provide a frame for regulators to be more intentional in terms of their regulatory diplomacy efforts.

In an era marked by accelerating change and escalating complexity, the ability to network, extend agency through connections, and continuously experiment is not just a luxury for regulators – it is an imperative.

Regulatory diplomacy is not a silver bullet – it is, however, a powerful tool that can help with the challenges of operating within and across the modern regulatory landscape.

___________________________________________________

Article prepared by:

Rob Warner, Chief Advisor Strategy, Maritime New Zealand.

Rob has worked across the NZ Government for over 30 years, and is a highly experienced strategist, certified strategic foresight and applied complexity (Cynefin) practitioner, Crown entity governance advisor, neuro leadership coach and group facilitator.

Rob is an alumnus of the: Oxford Executive Scenario programme (Säid Business School, Oxford); Harvard Business School strategic negotiation course; and the University of Houston executive strategic foresight programme.

For the last 6 years Rob has worked closely with the Maritime New Zealand Board and Executive Leadership Team advising on enterprise and regulatory strategy development, and ways to transform complexity into opportunity (over now, near, and next horizons).

Rob is part of a growing international network of Government foresight professionals, a member of the New Zealand Government Regulatory Initiative (G-Reg) community, and a passionate advocate of applied strategic, decision support and sense-making frameworks to help navigate uncertainty in a range of regulatory and policy settings.

Dr Grant Pink, Pracademic Advisor, ANZSOG National Regulators Community of Practice (NRCoP), Managing Director RECAP Consultants, and Adjunct Professor (Regulation and Enforcement) University of Tasmania.

Grant has more than 25 years regulatory and enforcement experience spanning practitioner, management, executive, academic, and consultancy roles, operating at local, state, national and international levels.

Grant has written more than thirty articles for practitioner and academic publications in the areas of regulatory practice, capacity building, networking, and collaboration. In 2021 he authored the book Navigating Regulatory Language: An A to Z Guide.

Academically Grant has a MA by research, which considered regulatory and enforcement networks (2010), and a PhD which considered how regulators build, maintain, and sustain regulatory capability and capacity (2017). In 2016 Grant founded RECAP Consultants Pty Ltd (RECAP). RECAP is a specialist regulatory consultancy providing services domestically and internationally.

[i] BEIS (2022). International Regulatory Cooperation Strategy. Department for Business, Energy & Industrial Strategy: UK Government. See https://assets.publishing.service.gov.uk/media/62bd83e2e90e075f26ca0487/international-regulatory-cooperation-irc-strategy.pdf

[ii] Warner, R. & Pink, G. (2023). ‘Navigating Regulatory Landscapes: Four Sights to advance regulatory practice and governance’. Guest Editorial, Regulation Policy & Practice Newsletter, APO, Edition 40, November 2023. See https://anzsog.edu.au/news/navigating-regulatory-landscapes-four-sights-to-advance-regulatory-practice-and-governance/

[iii] Armstrong, H., Gorst, C., & Rae, J. (2019). Renewing regulation – ‘Anticipatory regulation’ in an age of disruption. NESTA: London. See https://apo.org.au/node/324861