Why Companies Bring the State Back In. The Voluntary Self-Nationalisation of the Anglo-Persian Oil Company and the Rise of ‘Governance by Government’

While companies usually prefer private to hybrid governance, they sometimes transfer governance to governments. This paper assumes that this emerges from a decline in a firm’s relative market position. It tests this assumption in a two-stage qualitative analysis: First, it conducts a fuzzy-set QCA of these decisions based on BP’s Annual Company Reports. Second, it presents a process tracing of the voluntary self-nationalisation of the Anglo-Persian Oil Corporation. The paper produces three core findings: First, threats to a company’s survival enable a preference reversal in favour of governmentalisation. Second, shareholder dissatisfaction is a crucial motivator for governmentalisation. Third, managers with an entrepreneurial role-model are more sensitive to autonomy costs and more likely to opt for unconventional governance options.