Informality in Global Governance: Empowering the Powerful or Enabling the Weak? Mohammadhossein Sedehi

Mohammadhossein Sedehi - DPhil in Law, University of Oxford
2025/12/06

Nowadays, it is more observable that the world is straying away from unipolarity. Although it is unclear what shape it will take in the future, this transition is undeniable (Mearsheimer, 2019; Acharya, 2017). With new emerging powers on the global stage, competition among states is intensifying as they attempt to gain the most from this transition period. Seen in this context, global governance institutions are essential to states’ ambitions as they may be tools for power projection. States often establish such institutions in order to compete with their peers, as evidenced by the establishment of Asian Infrastructure Investment Bank by China (Klabbers, 2022, p. 19).

International organizations (IOs) have been a crucial part of international society as an actor in international relations and have played a major role in global governance and international order. International society refers to a community of states and other actors that hold themselves to be bound by certain rules and institutions, which is conceptually distinct from international order as the pattern of activities that sustains basic goals of coexistence among states (Buzan, 2004, p. 52). IOs have been defined as being comprised of these elements: a formal founding document, a secretariat, plenary and other organs (Schermers & Blokker, 2018, p. 40). Seen in this light, IOs are understood as formal, state-centered institutions who enjoy a separate legal personality from their members. In the 20^th century, there was a surge in the number of IOs in this sense.

However, from the late 20^th century onwards, another form of global governance institutions has begun to rise in both numbers and functions that are informal organizations (Westerwinter et al., 2021, p. 2).  These institutions could be found in various forms, from solely private transnational law institutions to informal intergovernmental organizations (IIGOs). Defining an informal body could prove to be more difficult than defining formal IOs since it lacks objective criteria and the concept of informality is a loose concept. However, some have attempted to propose a definition. IIGOs are portrayed as a group of states, meeting regularly, having an explicit shared expectation-instead of a binding agreement (F. A. Vabulas & Snidal, 2011, p. 7). Here it would be beneficial to note the distinction between IIGOs and Networked Governance. IIGOs are relatively bounded, state-based bodies that lack full legal–institutional formality but still constitute discrete organizations. On the other hand, Networked Governance implies more diffuse, often cross-sectoral webs of public and private actors coordinating policy without having an organizational centre.

Some IIGOs, like the G20, are at the heart of global governance and are significantly consequential (Kirton, 2016). States increasingly resort to informal governance, regarding various matters and specially economic governance,  owing to its unique features such as agility, less sovereignty costs and less transparency (F. Vabulas & Snidal, 2013, p. 195), nonetheless, IIGOs have remained understudied (Downie, 2022, p. 953). Seen in this light, understanding these institutions is indispensable as they are tools through which states exert influence. Exploring how power inequalities among states play out in IIGOs in comparison to formal intergovernmental organizations (FIGOs) is of great importance noting their increase in numbers and issue areas.

This short piece will attempt to shed light on this issue. First, a counterargument regarding the nature of IIGOs and the relevance of this question will be examined. Second, the common assumption about power dynamics in IIGOs which revolves around power-based approaches will be discussed. Third, this blog post will try to problematize the common assumption by utilizing issues such as, the role of expertise in IIGOs, the constitutional moments of FIGOs and, informality within FIGOs. This blog post will conclude by mentioning the downsides of ideal-type theorizations of IIGOs, FIGOs and informality in general.

Counterargument

The present question, the comparison between the effects of power inequalities in IIGOs and FIGOs, may raise another concern. IIGOs, by their definition, have no distinct personality of their own and are vested with no legal authority (Downie, 2022, p. 954). Therefore, one could argue that IIGOs are nothing more than the mere sum of their member states and they are not an organization. In this sense, this comparison between IIGOs and FIGOs is not relevant since IIGOs are not something in their own right, and, the power dynamics within IIGOs will be the same as power dynamics outside any institution, the normal situation among states.

This counterargument, coming from a mostly legal point of view, challenges the definition of international organization and its application to IIGOs. Insisting too much on a strict legal understanding of IOs, risks overlooking the importance of IIGOs by simply excluding them from the scope of studies, as the literature has done to some extent (Wessel, 2011, p. 255). Certainly, the informality of IIGOs is a matter of spectrum; some are more institutionalized than others. However, assuming these entities do not possess effects in their own right is contrary to the evidence. For instance, Financial Action Task Force (FATF) as an IIGO could be mentioned. Although it does not produce any binding legal obligation and does not have international legal personality per se, exerts considerable influence over the financial industry (Kerwer & Hülsse, 2011).

The Common Assumption

Now turning to the question at hand, this part tries to lay out the prevalent assumptions regarding the role of power dynamics in IIGOs. Some international relations scholars have developed a power-oriented approach to IIGOs and informality in general. Stone argues that the more inequal the powers are, the more informality should be observed in an institution’s design (Stone, 2013, p. 126). This argument relies on the presumption that powerful states favor informality as they have other valuable options outside the institution and do not rely on the institutional structure (Steinberg, 2002, p. 349).

IIGOs often have no formal decision making or voting rules, they do not create binding and restraining obligations, often there is no transparency in their functions, therefore, it is reasonable to argue that these institutions are more prone to powerful states’ influence as they can simply threat others to achieve their desired goals (Mearsheimer, 1994, p. 29). Formal rules and constraints are often seen as concessions that powerful states make in order to attract the participation of weaker states in institutions they design (Roger, 2020b, p. 55). In general, it is argued that formal rules within institutions benefit the weak, while informal procedure serve the powerful (Stone, 2011, p. 31). Thus, it could be deduced that IIGOs are beneficial to the powerful states. This assumption is supported by the fact that OECD states have been the main actors in IIGOs (Roger, 2020a, p. 198).

These power-based approaches, however, are mostly reliant on a state-centered, realist and strict understanding of power. Dahl defines power as A’s ability to get B to do something that B would not otherwise do (Dahl, 2007, p. 203). This definition, which equals power to coercion, seems to be inadequate in terms of accounting for the complicated network of global governance. Power, for the purposes of global governance, could be better defined as the ability of an actor to influence other actors and procedures through various channels (Moon, 2019, p. 5). In what follows, this blog post will try to pose some challenges to this common assumption about IIGOs, utilizing Moon’s typology of power.

Problematizing the Common Assumption

In this part, three considerations that that challenge this power-centric assumption will be discussed, namely, the pre-formation phase of FIGOs, informality within FIGOs, and the role of expertise in IIGOs. Regarding the first consideration, one may observe that when literature discusses FIGOs and the role of power inequality therein, it focuses on issues like sovereign equality, binding formal obligations and procedures and, in general, some kind of rule of law. However, it should be noted that all these notions only appear after the formation of the organization. Prior to the formation of the organization, in the negotiations phase, states are outside the formal boundaries. Therefore, often the design of FIGOs reflects the power dynamics among states (Moon, 2019, p. 3). In this sense, FIGOs may be even more prone to being affected by power inequalities since they create a form of ‘legalized hegemony’ providing powerful states with a legitimacy disguise in their exercise of power (Simpson, 2004, pp. 167–170). This legalized hegemony, may elevate the concept of great powers from a political idea to a legal one, thus even contributing to the reproduction of power inequality (Simpson, 2004, pp. 102–108).

One prominent example illustrated by Simpson of this phenomenon is the formation of the United Nations (UN). The design of the UN reflected the de facto power dynamics that existed at that time. As put by the Delegation of Netherlands regarding the design of the Security Council, ‘The smaller powers … are invited in the Dumbarton Oaks Plan to perpetuate and legalize an existing de-facto position of inferiority’ (Documents of the United Nations Conference on International Organization, 1945, p. 315). The existence of Veto powers within the Security Council could be mentioned as an example in that regard. This point indicates that contrary to the common assumption, FIGOs may prove even more dangerous to less powerful states as they both legalize the existing power dynamics prior to their creation and contribute to the reproduction of power through legalized hegemony. In the design of FIGOs, ‘While everyone in the collectivity may be taken into account to some degree, there is no reason to suppose everyone will be taken into account to the same degree’ (Gruber, 2004, p. 102).

The second point concerns the informal rules and procedures within FIGOs. The common assumption regarding power dynamics in IIGOs seems to rely on a sharp distinction between FIGOs and IIGOs. However, various informal practices are observable withing FIGOs that are very consequential. Westerwinter et al. discuss three forms of informality, namely, informality of, within and around institutions (Westerwinter et al., 2021, p. 5). In this sense, the common assumption may be inadequate as drawing a sharp distinction between IIGOs and FIGOs in terms of one being formal and the other informal is simply a reductionist account.

There are several examples of informal procedures within FIGOs. For instance, Kegley and Hook discuss how the US intended to leverage its foreign aid policies in order affect the voting pattern of the recipient states in the UN (Kegley & Hook, 1991). Kersting and Kilby explore how different US administrations utilize informal power in order to influence World Bank financial policies (Kersting & Kilby, 2021). Gifkins examines the informal ways, such as pen holding and agenda setting, permanent and elected members of the Security Council influence the agenda and outcomes of the Council beyond formal rules (Gifkins, 2021). Moreover, it is shown by Downie how IIGOs often govern by delegating issues to FIGOs, a pattern observed in G20’s practice during the financial crisis (Downie, 2022). These examples demonstrate that IIGOs and FIGOs are much more complicated and intertwined than one could simply portray one of them as essentially serving the powerful and the other serving the weak.

The third point concerns the role of expertise in some IIGOs. Some IIGOs, such as those that concern standard-setting like FATF, are primarily based on expertise (Jacobsson, 2002, p. 41). This not only provides legitimacy, as superior knowledge is a source of authority, but also may account for impartiality. The compliance with FATA decisions – although it does not produce any hard law obligations - is interestingly high and could cause serious problems for states in case of non-compliance (Kerwer & Hülsse, 2011). It could be argued that reliance on expertise in IIGOs may reduce the effect of power inequality and thus is contrary to the common assumption.

One counterargument that could be made is regarding two types of power highlighted by Moon, namely, expert and discursive power. Expert power is exercised when one actor shapes what others hold to be legitimate and factually true. Discursive power is exercised when actors shape the language others use to frame and conceptualize issues (Moon, 2019, p. 6). In this sense, powerful states who enjoy vast resources can mobilize those resources to construct the knowledge in a given field, thus affecting even pure technical expertise-based bodies. However, this objection applies to IIGOs and FIGOs alike.

Conclusion

This short blog post tried to challenge the common assumption regarding IIGOs, that they are overtly in favor of the powerful while FIGOs are the opposite. Various examples have demonstrated that this account requires more nuance as each institution may be different due to its membership and functions and also the issue of informality is a matter of spectrum and could be found in almost every institution. Therefore, it would not be accurate to argue that IIGOs are in a direct link with power inequality and Roger has shown in a quantitative research that this correlation does not exist (Roger, 2020a, p. 200).

The example of BRICS and the New Development Bank (NDB) is worth mentioning in order to show how power inequality plays out in a FIGO, that is the NBD. The Agreement on the New Development Bank, which is the constitutive instrument of the NBD, in Article 8(c)(i), states that the voting power of the founding members of the BRICS may not fall below 55 percent. In the pre-formation phase of the NBD, the voting superiority of the founding members is locked in in the constitutive instrument of the FIGO.

I believe that the issue with power-based approaches is what Martin calls ideal-type theorizing (Martin, 2021, p. 177). Although she talks about the theorization of IIGOs, this could be extrapolated to the problem of this blog post. Therefore, arguably, no such sharp distinction between IIGOs and FIGOs could be made in terms of the role of power inequality, as they are to some extent intertwined.