Abstract:

This paper contributes to the evolving body of literature that explores transnational policymaking and governance processes in action. Our empirical focus is on the relatively recent shift in the European Commission (EC) policy stance vis-a-vis the civil liability of statutory auditors, moving from a longstanding rejection of the need for regulatory action to the publication of an official Recommendation in 2008 that European Member States should establish a certain form of limited liability for auditors. In exploring such a shift in policy opinion, European audit policymaking emerges as a progressively transnational (as opposed to state-centric), multilevel polity externally influenced by manifold actors. However, and in some contrast to the predominant emphasis in the literature, the study demonstrates how the sovereign authority of EU Member States retains a significant constraining influence on the scope of transnational governance, especially in terms of policy endorsement and implementation.