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Multinational corporations and host country institutions: A case study of CSR activities in Angola

  • Wiig, Arne
  • Kolstad, Ivar

While institutions are important for economic development, particularly in resource rich countries, the interaction between multinational corporations and host country institutions is not well understood. This article presents an in-depth case study of multinational oil companies' CSR activities in Angola. The results show that CSR is on the whole relatively unimportant for getting licenses and contracts in Angola. To the extent that CSR matters, it appears to be used strategically by corporations to increase their chances of winning licenses and contracts. Moreover, oil companies do not address governance problems in Angola. These results have implications for theories of the resource curse and of strategic CSR. By using CSR strategically, there is a risk that multinational corporations facilitate patronage problems in resource rich countries, exacerbating the resource curse. Furthermore, the standard assumption that 'good' institutions are in the interest of corporations ignores the distributive consequences of institutional reform. The failure to address governance problems may thus reflect collective complacency of corporations rather than collective actions problems.

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Article provided by Elsevier in its journal International Business Review.

Volume (Year): 19 (2010)
Issue (Month): 2 (April)
Pages: 178-190

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Handle: RePEc:eee:iburev:v:19:y:2010:i:2:p:178-190
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