Standards Development and the Political Process

One Standards Developing Organization’s Perspective

by James M. Shannon

Adapted from James Shannon’s keynote speech given at the August annual conference of SES: The Society for Standards Professionals.

The SES annual conference is the perfect place to talk about something that has been bothering me for some time. You are a highly respected group of professionals “committed exclusively to furthering public awareness and knowledge of standards and standardization.” And that has been your mission in one form or another since your founding in 1947.

Raising Awareness

I would, however, be willing to bet that none of you in this room started your professional education with the idea that you were going to become standards professionals. I know that I didn’t. Nobody grows up learning anything about standards. I have been at the National Fire Protection Association for close to two decades, and my close friends and family still don’t have a clue as to what I do or what NFPA really is. They think I work for the firefighters.

We, all of us in this room, are like a secret society. We know how important standards are. We understand the crucial role that standards play in keeping the economy moving, facilitating the transfer of technology and global interoperability, providing market access for products and services, and assessing conformity. And we also know a lot about the incredible system that exists internationally to develop standards and the working relationships between the private sector and government that make it all possible. We come together and speak our own language, but I think we are all aware how little understood standards development is to most of our colleagues.

I have a friend who is a professor at MIT [Massacusetts Institute of Technology]. He told me that he is teaching a course for undergraduates that deals with standards development. He starts by asking how they think standards are developed. None of them has the slightest idea.

Good for MIT that they are doing that. I think every university that grants engineering degrees should teach something about standards, even offer a required course in standards development, because all of those engineering students will need to know about standards at some point in their careers, and the earlier they know, the better for them and the better for all the rest of us. And we need those smart people involved in the development of standards. Standards development is very labor intensive, as all of you know.

Take my own organization as just one example. NFPA develops consensus standards for fire and electrical safety and other related hazards. We are proud to have an American National Standards Institute-approved system. In NFPA alone we develop almost 300 codes and standards. We have more than 5,000 volunteers who sit on our technical committees, and we give an opportunity to participate to everybody who has something to contribute to the process.

We just completed the latest edition of the National Electrical Code; it’s the seventh we have done since I joined NFPA, and I am just as awestruck today as I was the first time I was involved in the NEC process at the thousands and thousands of hours of volunteer effort that go into that document and the breadth of the participation from the private sector and all levels of government. And each edition adapts to changing technological needs. It’s our biggest document, but all of our documents go through that same process. The contribution to safety is immense. It is also a good example of the crucial role that standardization plays in facilitating economic activity. We provide the neutral forum that is good for the safety of consumers and good for the industry as well.

NFPA is just one organization. When we consider all of the organizations that you represent and the others that aren’t here that are involved in standards development, the impact of standards development is really incalculable. Yet very few in the public are even aware that this standards community exists, any more than any of us were aware before we stumbled into it at some point in our careers.

I am reminded of a conversation I had with an NFPA board member about 15 years ago. He was a principal safety officer of a major corporation that had a very tangible need and interest in NFPA standards. He told me that he had to use vacation time to participate on our board and our technical committees. His organization didn’t understand the importance of standards.

What concerns me even more than that is that people who are in elective office or other high government positions that are making decisions that can have a profound impact on the ability to keep this system strong are even more ignorant about standards. I have spoken at length to very smart and experienced people in government time after time, and they are, more often than not, completely in the dark as to the dependence of governmental agencies on private standards. If it occurs to them that standards must exist, rarely do they give any thought to how those standards are developed.

I have a friend who is a very smart guy. He has served in state government for many years, both in the legislature and statewide elective office. He has written books about state government. He also served in the White House. He knows a lot about government. When I ran into him a few years ago he asked me where I worked. When I began describing NFPA he was amazed. He had no idea that the electrical code in his state was developed by a private organization or that we held the copyright on it. When I described to him how many organizations developed standards and how they were used he was really surprised. He was also a little skeptical I think about whether the private sector was the place to make those kinds of decisions.

As I reflect on my own career in government I think: there were important policy questions both in Washington [D.C.] when I was a member of Congress, and here in state government when I was attorney general, that involved the application of standards where I was just as much in the dark.

We have managed to be very successful, as a community, without having senior governmental officials truly understand what we do. But that ignorance-is-bliss policy isn’t going to work for us any longer. The globalization of the economy, the development of the Internet and with it the notion that all information should be free, and the need for greater collaboration among private sector actors, especially in the technology areas — not to mention the antitrust concerns that greater collaboration might raise — mean that we had better be a lot more aggressive at educating public officials. If we are to keep this system strong and ready to do all that we need it to do to encourage competitiveness and to protect the interests of consumers, it is essential that we tell our story better than we have done up until now.

Intellectual Property Rights

One issue that has been of great concern to us and other standards developers over recent years that I think illustrates this problem involves the ability of standards developers to own the intellectual property rights to standards. We and many other developers of standards are dependent upon the ownership of the standards as our primary revenue source. The Veeck case, which was decided in the 5th Circuit Court of Appeals several years ago and which stated that a model code, as adopted into law, has no copyright, raised serious questions about our ability to own the rights to standards once they are adopted into law. Happily, no other court has gone in that direction.

What I found most troubling about Veeck was not just the decision but the reasoning in the decision. Despite the best efforts of very able counsel it was clear that the majority of the court still did not understand how standards are developed and what their purpose is. In fact, some of the members of the court seemed completely oblivious to the need to maintain an unbiased system to sort through difficult technical questions. They suggested that the job could be left to trade associations. They ignored the value that standards provide to government regulators. They ignored longstanding copyright laws that protect standards development and overwhelming public policy considerations to reach a contorted result. They seemed to act on intuition that, in this day and age, if a standard is adopted into law or even referenced in a law it should not have copyright protection. The implications of this case if it were ever upheld by the U.S. Supreme Court would be disastrous for many standards developers.

As I said earlier, no other court has followed their lead. But another could. Certainly, elected legislators are capable of responding the same way in a context that is more political than the court. How would a member of the legislature vote on a straight-up proposition calling for free access to codes and standards that have been adopted into law? We have to make sure that when that question arises, and it most certainly will, we have done the homework to make sure that the public benefit provided by maintaining the standards development system is part of the debate.

But copyright protection is not the only concern. Private standards development depends on the ability of market participants, in many cases direct competitors, to work together and collaborate on standards. Antitrust regulators and courts, in analyzing standards development for anti-competitive behavior, have usually balanced the public benefit of standards against any harm to competition. Especially in areas involving technology, we are now seeing a lot more antitrust scrutiny than we have recently. I don’t object to that scrutiny per se. The law should ensure that standards development does not become cover for illegal anti-competitive activity. But there should also be sufficient space for standards development.

We have had some success in recent years in getting Congress to recognize this need. Specifically, a few years ago several standards developing organizations were able to have a provision signed into law that relieves SDOs from the threat of treble damages for antitrust violations if we meet certain enumerated requirements. This law was based on the law that allows research and development joint ventures. NFPA, ASTM International and ASME International worked hard to get this bill through, and I think it is a good model for the kind of vigorous advocacy for standards development that we need to see more of.

I would expect that we will be hearing a lot more about antitrust issues and standards in the next few years, and I think we should, as a community, try to anticipate where those issues are likely to emerge and engage now with antitrust policy makers about how those issues might be handled before we have a blockbuster case that would, at the very least, result in significant uncertainty for all of us.

Trade Policy

A third area where we should be much more actively involved is trade policy. All of us in this room understand that it is crucial to our economic well-being that we encourage international commerce. We are also acutely aware of how important standards are to trade policy. When trade agreements are negotiated, the standards implications should be taken into account. ANSI has played an important role in making sure those governmental agencies responsible for international trade understand the standards issues with which they deal. We have enjoyed a good relationship with the U.S. Trade Representative and the U.S. Department of Commerce. The National Institute of Standards and Technology has been a terrific partner in all of these efforts. But this will be an even more critical area in the coming years as we pull out of the worldwide economic crisis.

I have had the experience of having foreign government officials tell me that their preference would be to use an NFPA standard in a particular situation, but because of their desire to enter international markets they feel pressured to use only an International Organization for Standardization (ISO) standard. That’s crazy. All of us are probably already developing standards that are widely used internationally. We should all be able to participate internationally on a level playing field. In pursuing its trade initiatives, our government should make a priority of the protection of the right of standards developing organizations to offer their standards internationally and protect their intellectual property rights.

All of these issues raise significant concerns for standards developers and standards users. I believe that on all of them we can make a compelling case, but to this point, I don’t think we have done that. We have been content to survive on the inertia that comes from so much of the established economic and governmental actors having depended for so long on the work that we do. It would be a big mistake for us to think that we can continue to flourish that way.

I remember hearing Connie Morella, former congresswoman and ambassador to the Organization of Economic Cooperation and Development, speak at ANSI’s World Standards Day dinner a few years ago. She said, “Standards are like toothbrushes. Everybody wants one but nobody wants to use anybody else’s.” It’s true that within the standards community we can be very competitive. We have diverse interests and diverse needs. But on the major issues it is pretty easy to identify where the interest of the community as a whole lies.

We need a strong, open and healthy community of standards developers and standards advocates. We need the forum that standards development provides for the private and public sectors to thrash out quickly, efficiently and fairly the difficult technical questions that will keep coming up in an incredibly dynamic, ever-changing economy. As a national economic priority we need to have a credible system of standards development in North America if our businesses are to stay globally competitive. And above all we need to provide the public with the reassurance of safety and quality that standards provide.

And in order to ensure that this system — whose value to society is so apparent to us — stays strong, we need to make the time and put in the effort to educate policymakers at all levels of government about who we are and what we do. Individual SDOs, and businesses that rely on standards, are an important part of that process. Certainly ANSI is involved in it every day, but I think as one of the most important organizations of standards professionals it is crucial that the members of the Standards Engineering Society be engaged in this undertaking and, at NFPA, we look forward to joining you in the fight.

James M. Shannon has been president and chief executive officer of the National Fire Protection Association, Qunicy, Mass., since 2002. He previously had been an NFPA senior vice president and general counsel. Before his work at NFPA, Shannon was a Massachusetts attorney general, a senior partner in the Boston, Mass., offices of Hale and Dorr, and a member fo the U.S. House of Representatives, where he served on the Ways and Means Committee.