D2 - Companies and Governance in Sub-Saharan Africa
This project systematically investigates if and how companies engage in local governance in areas of limited statehood. We are particularly interested in the quality of non-state governance. While some argue that business in governance may complement or substitute for weak state capacities, governance literature paradoxically emphasizes the importance of a credible shadow of hierarchy to make firms’ ‘good governance’ behavior work. We examine if and how companies’ governance behavior depends on the capacity and the commitment of the state to cast a credible shadow of hierarchy. More importantly, are there functional equivalents that hold companies accountable in these environments, encouraging them to provide collective goods, to do so in a more inclusive way, and to organize production to minimize negative externalities? We investigate these questions empirically by studying the diverse security and environmental practices of extractive industries in four mining areas in Sub-Saharan Africa, which vary with regard to the capacities and the commitment of the state.