Downstream management practices of transnational companies in
institutionally vulnerable countries: Export and use of hazardous
products
Michael Søgaard Jørgensen
a, *
, Bruno Milanez
b
a
Department of Development and Planning, Aalborg University, Copenhagen, Denmark
b
Department of Industrial and Mechanical Engineering, Federal University of Juiz de Fora, Minas Gerais, Brazil
article info
Article history:
Received 27 July 2015
Received in revised form
3 August 2016
Accepted 13 October 2016
Available online 14 October 2016
Keywords:
Institutional vulnerability
Transnational company
Hazardous products
Path dependency
Social constitution of company
Innovation with users
abstract
Analyses of social and environmental management in transnational product chains focus often upstream
on suppliers in socially and institutionally vulnerable countries and these suppliers' hazardous processes.
Furthermore focus is on transnational companies' responsibility when they source from such suppliers.
On the contrary, not much focus has been on transnational companies' downstream export of hazardous
products to vulnerable countries and the product use in those countries. The article uses pesticides as
case of hazardous products and identifies mechanisms in the downstream social and environmental
management of a Danish pesticide company in vulnerable countries and especially in Brazil. The iden-
tified mechanisms are: the transnational company's on-going interpretation of the regulatory and ethical
obligations for development and use of its hazardous products in vulnerable countries, path dependency
and path creation in the business strategy, geographical and organisational coverage of the management
systems and practices, the willingness of the company to address social and institutional vulnerability in
use countries, and the roles of users and other actors in development and facilitation of more sustainable
practices. The mechanisms are discussed with reference to other analyses. In the conclusion the
mechanisms are presented as themes in future research and civil society organisations' activities and as
guidance in businesses' development and assessment of more sustainable management practices. The
benefits of transnational research cooperation for this type of research are also discussed.
© 2016 Elsevier Ltd. All rights reserved.
1. Introduction
The recent 10e15 years there has been increasing focus on
corporate social responsibility (CSR) of transnational companies
(TNCs) in institutionally vulnerable countries (IVCs), not least in
relation to when TNCs source materials and products from com-
panies, which apply hazardous processes like in the textile industry
(Roberts, 2003; Robinson, 2010). Castleman (2015) discusses within
this perspective what he calls “export of hazardous industries”
when a TNC has production facilities in IVCs that are not allowed in
the TNC's home country (for example production of asbestos).
In this article, we define IVCs as newly industrialised countries
and other peripheral countries. One aspect of TNC practices in IVCs
concerns whether and how a TNC tries to benefit from weaker
national regulation in IVCs or the TNC shows the same level of
social and environmental responsibility in the IVCs as in its home
country (Crane and Matten, 2010; Hansen and Kuada, 2006).
In contradiction to the increased focus on sourcing in IVCs, there
has not been much focus on TNCs' downstream export of hazardous
products to IVCs and the product use in these countries. Also within
this topic, different TNC practices can be expected. Weaker national
regulation, trade unions, environmental organisations etc. in IVCs
may imply lower demands to health and environmental in relation
to for example chemical products than in Western countries, which
a TNC might try to benefit from. However, a TNC might improve
social and environmental protection in an IVC, for example if social
conflicts in an IVC or in the TNC's home country force the company
to improve its practices in IVCs (Siqueira and Levenstein, 2000).
The objective of this article is to identify and discuss mecha-
nisms in the shaping of the social and environmental practices of
TNC export of hazardous products to IVCs and the use of the
products in IVCs through a longitudinal case study of a specific
* Corresponding author.
E-mail address: msjo@plan.aau.dk (M.S. Jørgensen).
Contents lists available at ScienceDirect
Journal of Cleaner Production
journal homepage: www.elsevier.com/locate/jclepro
http://dx.doi.org/10.1016/j.jclepro.2016.10.060
0959-6526/© 2016 Elsevier Ltd. All rights reserved.
Journal of Cleaner Production 140 (2017) 1095e1104