Neither takers nor makers: The Big-4 auditing firms as regulatory intermediaries

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What are regulatory intermediaries? What roles do regulatory intermediaries play? What is the basis of their regulatory capacity and authority? This article examines these questions by focusing on the Big-4 international audit firms in the context of harmonizing international financial reporting standards. I argue that regulatory intermediaries perform a variety of regulatory market failure correcting functions for both regulatory makers and takers. Intermediation is far from being secondary to the regulatory process, and intermediaries, particularly those of transnational nature, have a pivotal role. Furthermore, regulatory intermediaries, as exemplified in the case of the Big-4, continuously challenge the primacy of the state, and the division of labor and balance of power between regulatory actors. Regulatory entrepreneurship and activism, coupled with unique organizational model based on global networks of partnerships, have led to the ascension of the Big-4 to unprecedented regulatory and market powers.

Original languageAmerican English
Pages (from-to)349-374
Number of pages26
JournalAccounting History
Issue number3
StatePublished - 1 Aug 2020


  • Big-4
  • IFRS
  • regulatory intermediaries
  • standard-setting

All Science Journal Classification (ASJC) codes

  • Accounting
  • History


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