Research Project D2 - Summary

This project examines whether and in what forms corporations contribute to governance in areas of limited statehood and the problems related to such non-state governance. Previous studies have highlighted the growing role of private actors in the governing processes of Western states. Building on this foundation, we ask to what extent corporate participation in governance correlates to the degree of limitation (in the monopoly of violence and in governing capacities) and restraint (through legal structures and checks on power) of statehood. In order to draw conclusions about the role of private actors in areas of limited statehood and to foster a nuanced depiction of governance forms, we focus specifically on functional equivalents to the ideal-type model of modern statehood. Modern statehood is defined by a state-generated “shadow of hierarchy,” as well as by the political autonomy of social actors, protected by democratic, constitutionally conceived state institutions. To what extent can the shadow of hierarchy derive from external forces? Do competition (shadow of the market), social capital (shadow of the community), or the complete absence of statehood (shadow of anarchy) offer comparable incentives for companies to engage in inclusive governance and reduce the negative external effects of core business activity?

We aim to combine governance research with current literature on states outside the OECD world, expanding our scope of interest to include “new” forms of governance that emerge in areas of limited or differently configured statehood. The study shall not only look at the actors involved, their sources of power, and the chosen governance modes, but also we will focus on creating an analytical framework that differentiates according to the inclusivity of governance. We distinguish between governance services from corporations as a private good, a club good, or a collective good, and examine the respective (unintended) effects on local governance.

Empirically, the project encompasses four areas in Sub-Saharan Africa that vary from each other with respect to the limitation and restraint of statehood (mining areas in South Africa, Tanzania, Guinea and the DRC). We will use the example of extractive industries to study corporate contributions to and effects upon local governance. By comparing the arenas of environment and security, we are able to accommodate both functional and territorial variations in the shadow of hierarchy, capturing the range of corporations’ motivations, as well as the highly variable scale and scope of their governance services.

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Project partners