The changing landscape of business and conflict in fragile states

Abstract

Large-scale investments in fragile states - in Latin America, Africa, the former Soviet Union and Asia - become magnets for conflict, which undermines business, development and security.

International policy responds with regulation, state-building and institutional reform, with poor and often perverse results. Caught up in old ways of thinking about conflict and fragility, and an age-old fight over whether multinational corporations are good or bad for peaceful development, it leaves business-related conflicts in fragile states to multiply and fester.

Surveying a new strategic landscape of business and conflict, Brian Ganson and Achim Wennmann conclude that neither company shareholders nor advocates for peaceful development need, or should, accept the growing cost of business-related conflict in fragile states. Drawing on decades of experience from mainstream conflict prevention and violence reduction efforts, as well as promising company practice, they show that even acute conflict is manageable when dealt with pragmatically, locally and on its own terms.

The analysis and conclusions of this Adelphi book will interest policymakers, business leaders and community advocates alike - all those hoping to mitigate today's conflicts while helping to reduce fragility and build a firmer foundation for inclusive development.

Notes

1 See Earthrights, ‘The Yadana Pipeline’, http://www.earthrights.org/campaigns/yadana-pipeline.

2 Mary B. Anderson and Brian Ganson, Report of the Fifth CDA/CEP Visit to the Yadana Pipeline in Myanmar/Burma (Cambridge, MA: CDA, 2008).

3 Burma Campaign UK, ‘Halt All Dams Now in Salween River and All Ethnic Areas – Protests at Dam Sites’, 14 March 2015, http://burmacampaign.org.uk/halt-all-dams-now-in-salween-river-and-all-ethnic-areas-protests-at-dam-sites.

4 See http://www.myanmar-responsiblebusiness.org.

5 Measured in terms of the extent of forest. See Food and Agriculture Organization (FAO), ‘Global Forest Resources Assessment’ (Rome: FAO, 2010), p. 230.

6 Environmental Investigation Agency, ‘Myanmar’s Rosewood Crisis’ (London: EIA, 2014).

7 World Wide Fund for Nature (WWF), Ecosystems in the Greater Mekong: Past Trends, Current Status, Possible Futures (Geneva: WWF, 2013).

8 Editorial Board, ‘The Plunder of Myanmar’, New York Times, 23 January 2015.

9 Atul Sethi, ‘Buddhist–Rohingya Clashes: Economy the Real Trigger?’, Times of India, 11 July 2013.

10 Alastair Leithead, ‘Burmese “Slavery” Fishermen Are Trafficked And Abused’, BBC News, 25 April 2015.

11 Timo KivimäKi and Paul Pasch, The Dynamics of Conflict in the Multiethnic Union of Myanmar. PCIA Country Conflict-Analysis Study (Berlin: FES, 2009).

12 Chetan Kumar, ‘Building National Infrastructures for Peace: UN Assistance for Internally Negotiated Solutions to Violent Conflict', in Susan Allen Nan, Zacharia C. Mampilly and Andrea Bartoli (eds), Peacemaking: From Practice to Theory (Santa Barbara, CA: Praeger, 2011), p. 384. Based on United Nations Development Programme data.

13 ICRC, ‘How is the Term “Armed Conflict” Defined in International Humanitarian Law?' ICRC Opinion Paper, 2008, p. 1, https://www.icrc.org/eng/resources/documents/art icle/ot her/armed-conflict -article-170308.htm.

14 History of the United Nations – 1942: The Declaration by United Nations, http://www.un.org/en/sections/history-united-nations-charter/1942-declaration-united-nations/index.html.

15 Preamble of the UN Charter, available at http://www.un.org/en/sections/un-charter/preamble/index.html.

16 Achim Wennmann (ed.), 20 Years of ‘An Agenda for Peace’: A New Vision for Conflict Prevention? (Geneva: Geneva Peacebuilding Platform, 2012).

17 Peter Wallensteen, Understanding Conflict Resolution (London: Sage, 2007), pp. 16–22.

18 Martin Hollis, The Philosophy of Social Science: An Introduction (Cambridge: Cambridge University Press, 1994), pp. 40–51.

19 See the definition of the Uppsala Data Conflict Programme, http://www.pcr.uu.se/research/ucdp/definitions/d efinition of_armed_conflict.

20 Therése Pettersson and Peter Wallensteen, ‘Armed Conflict 1946– 2014′, Journal of Peace Research, vol. 52, no. 2, 2015, p. 536.

21 Paul Collier, Lani Elliott, Håvard Hegre, Anke Hoeffler, Marta Reynal-Querol and Nicholas Sambanis, Breaking the Conflict Trap: Civil War and Development Policy (Washington, DC: World Bank, 2003). For a critique, see Christopher Cramer, ‘Homo Economicus Goes to War: Methodological Individualism, Rational Choice and the Political Economy of War’, World Development, vol. 11, no. 11, 2002.

22 See United Nations General Assembly (UNGA), Report of the Security Council: 1 August 2014–31 July 2015, document A/70/2 (New York: United Nations, 2015), pp. 10, 12–28.

23 OCHA, Global Humanitarian Overview 2016 (Geneva: OCHA, 2015), p. 12.

24 Chronic violence occurs ‘where rates of violent death are at least twice the average for the country income category, where these levels are sustained for five years or more and where acts of violence not necessarily resulting in death are recorded at high levels across several socialization spaces, such as the household, the neighborhood, and the school, contributing to the further reproduction of violence over time’: Jenny Pearce, ‘Violence, Power and Participation: Building Citizenship in Contexts of Chronic Violence’, IDS Working Paper 274 (Brighton: Institute of Development Studies, 2007), p. 7.

25 Andrew Tomlinson, ‘Putting the Pieces Together: Towards a Unified Approach to Prevention at the United Nations’, in Wennmann, 20 Years of ‘An Agenda for Peace’, p. 18.

26 Geneva Declaration Secretariat (GDS), Global Burden of Armed Violence: Lethal Encounters (Cambridge: Cambridge University Press, 2015), p. 51.

27 UNODC, Global Study on Homicide (Vienna: UNODC, 2013), p. 58. Ranking based on violent death rate per 100,000 population in 2012 or latest available year.

28 Comparison of GDS and Uppsala data for 2012 made by the authors. See http://www.genevadeclaration.org/measurability/global-burden-of-armed-violence/gbav-2015/interactive-map-charts.html and https://uppsalaconflictdataprogram.files.wordpress.com/2013/09/armedconflicts_2012.jpg.

29 GDS, Global Burden of Armed Violence, p. 51.

30 Based on comparison between 32,685 terrorism victims in 2014 and 377,000 victims annually between 2007–12. See Institute of Economics and Peace (IEP), Global Terrorism Index (Sydney: IEP, 2015), p. 2; and GDS, Global Burden of Armed Violence, p. 51.

31 UNODC, Global Study on Homicide (Vienna: UNODC, 2013), p. 11.

32 GDS, Global Burden of Armed Violence, p. 87.

33 UNODC, Global Study on Homicide, p. 14.

34 World Health Organization (WHO), Global Status Report on Violence Prevention (Geneva: WHO, 2014), p. 2.

35 Ibid.

36 Patrick Corcoran, ‘Mexico Survey Reveals Extent of Criminal Attacks on Businesses’, InsightCrime, 12 June, 2015, https://mail.google.com/mail/u/0/#search/insight+crime/14e 0b4306e87998a?compose=14e1a767 9b3ff9ad.

37 See Carl Boggs and Tom Pollard, The Hollywood War Machine: U.S. Militarism and Popular Culture (London: Routledge, 2016).

38 See Christopher Cramer, Civil War is Not a Stupid Thing: Accounting for Violence in Developing Countries (London: C. Hurst & Co., 2006), p. 4.

39 David Keen, ‘A Rational Kind of Madness’, Oxford Development Studies, vol. 25, no. 1, 1997, p. 68.

40 David Keen, The Economic Functions of Violence in Civil Wars (London: IISS, 1998), p. 12.

41 Ibid.

42 Azam Ahmed and Paulina Villegas, ‘As Frustrations with Mexico’s Government Mount, so do Lynchings’, New York Times, 23 January 2016.

43 David Keen, ‘Incentives and Disincentives for Violence’, in Mats Berda and David Malone (eds), Greed and Grievance: Economic Agendas in Civil Wars (New York: International Peace Academy, 2000), p. 22.

44 Achim Wennmann, ‘The Political Economy of Violent Conflict’, in The Armed Conflict Survey 2016 (London: IISS, 2016), pp. 19–32.

45 Stathis N. Kalyvas, The Logic of Violence in Civil War (Cambridge: Cambridge University Press, 2006); Patricia Justino, Tilman Brück and Philip Verwimp (eds), A Micro-Level Perspective on the Dynamics of Conflict, Violence, and Development (Oxford: Oxford University Press, 2014).

46 Organisation for Economic Co-operation and Development (OECD), Think Local, Act Global: Confronting Factors That Influence Conflict and Fragility (Paris: OECD, 2012).

47 Mary B. Anderson and Marshall Wallace, Opting Out of War: Strategies to Prevent Violent Conflict (Boulder, CO: Lynne Rienner, 2013).

48 Pettersson and Wallensteen, ‘Armed Conflicts 1946–2014′, pp. 536, 539.

49 This is, of course, a heated debate. See Steven Pinker, The Better Angels of Nature: A History of Violence and Humanity (London: Penguin, 2011); for a discussion of the ‘declinist thesis’ see Human Security Report Project, Human Security Report 2013: The Decline in Global Violence: Evidence, Explanation, and Contestation (Vancouver: Human Security Press, 2013), pp. 17–48.

50 Aske Nørby Bonde and Achim Wennmann, Risks to Peace: A Review of Data Sources (Geneva: Geneva Peacebuilding Platform, 2015).

51 Friedrich Glasl, Confronting Conflict (Bristol: Hawthorn Press, 1999).

52 Stated by Peter Maurer, 31 October 2015, available at https://www.icrc.org/en/document/peter-maurer-respect-laws-of-war.

53 See The Millennium Project (TMP), 2013–14 State of the Future (Washington, DC: TMP, 2014), p. 42.

54 Ibid.

55 Michael Waithaka, Miriam Kyotalimye, Timothy S. Thomas, and Gerald C. Nelson, ‘Summary and Conclusions’, in Michael Waithaka, Gerald C. Nelson, Timothy S. Thomas, and Miriam Kyotalimye, (eds), 2013. East African Agriculture and Climate Change: A Comprehensive Analysis (Washington, DC: International Food Policy Research Institute, 2013), p. 378.

56 International Organization for Migration, ‘Background Research on the Great Lakes Region’, unpublished.

57 Paul Richards and Jean Pierre Chauveau, Land, Agricultural Change and Conflict in West Africa: Regional Issues from Sierra Leone, Liberia and Côte d'Ivoire (Paris: OECD, 2007).

58 Malabo Declaration on Accelerated Agricultural Growth and Transformation for Shared Prosperity and Improved Livelihoods, p. 3, http://pages.au.int/sites/default/files/Malabo%20 Declaration%202014_11%2026-.pdf.

59 Ibid., p. 7.

60 United Nations Department for Social Affairs (UNDESA), World Urbanization Prospects (New York: UNDESA, 2014), p. 1.

61 WHO, Urban Population Growth (Geneva: Global Health Observatory, n.d.); Humansecurity-cities.org, Human Security for an Urban Century: Local Challenges, Global Perspectives (Ottawa: Canadian Consortium on Human Security, 2007), p. 9; Robert Muggah, Researching the Urban Dilemma: Urbanization, Poverty and Violence (Ottawa: IDRC, 2012), p. 1.

62 Oliver Jütersonke and Robert Muggah, ‘Rethinking Stabilization and Humanitarian Action in “Fragile Cities”’, in Ben Perrin (ed.), Modern Warfare: Armed Groups, Private Militaries, Humanitarian Organizations, and the Law (Vancouver: University of British Columbia Press, 2012), pp. 311–27.

63 Johanna Wheeler, ‘Brazil: Citizenship, Violence, Power and Authority in Rio’s favelas’, in Alexander Ramsbotham and Achim Wennmann (eds), Legitimacy and Peace Processes: From Coercion to Consent (London: Conciliation Resources, 2014), pp. 86–9.

64 United Nations, The Report of the High-Level Panel of Eminent Persons on the Post-2015 Development Agenda (New York: United Nations, 2013), p. 17.

65 Oliver Jütersonke and Hannah Dönges, ‘Digging for Trouble: Violence and Frontier Urbanization’, in Small Arms Survey 2015: Weapons and the World (Cambridge: Cambridge University Press, 2015), p. 37.

66 Ibid.

67 Ibid., p. 53.

68 Ibid., p. 37.

69 The Core Writing Team, Rajendra K. Pachauri and Leo Meyer (eds), Climate Change 2014: Synthesis Report (Geneva: International Panel on Climate Change, 2014), p. 15.

70 Marussia Whately and Rebeca Lerer, ‘Brazil Drought: Water Rationing Alone Won’t Save São Paulo’, Guardian, 11 February 2015.

71 Jonathan Amos, ‘US “At Risk of Mega-drought Future”’, BBC News, 13 February 2015.

72 US Department of Defense, Response to Congressional Inquiry on National Security Implications of Climate-Related Risks and a Changing Climate, 23 July 2015, p. 3, http://archive.defense.gov/pubs/150724-congressional-report-on-national-implications-of-climate-change.pdf?source=govdelivery.

73 National Intelligence Council (NIC), Global Trends 2030: Alternative Worlds (Washington, DC: NIC, 2012), p. v.

74 TMP, 2013–14 State of the Future, p. 155.

75 Dost Bardouille-Crema, Diana Chigas and Benjamin Miller, ‘How Do Our Operations Interact with the Environment?’, in Brian Ganson (ed.), Management in Complex Environments: Questions for Leaders (Stockholm: International Council of Swedish Industry, 2013), p. 79.

76 Oxford Marten School Commission (OMSC), Now for the Long Term (Oxford: Oxford University Press, 2013), p. 18.

77 See http://csonet.org/.

78 See https://www.unglobalcompact.org/AboutTheGC/index.html.

79 NIC, Global Trends 2030, p. 19.

80 OMSC, Now for the Long Term, p. 23.

81 NIC, Global Trends 2030, p. 64.

82 Bardouille-Crema, Chigas, Miller, ‘How Do Our Operations Interact with the Environment?’

83 Brian Ganson, Risk and Risk Mitigation in the Oil and Gas Sector in Uganda (Geneva: Geneva Peacebuilding Platform, 2012).

84 Bardouille-Crema, Chigas, Miller, ‘How Do Our Operations Interact with the Environment?’

85 Ibid.

86 Paul Hollesen, ‘Is Our Own House in Order?’, in Ganson, Management in Complex Environments, p. 208.

87 UNCTAD, World Investment Report 2013 (Geneva: UNCTAD, 2013), p. 65.

88 Ibid., p. 80.

89 Ibid., p. 74.

90 International Finance Corporation (IFC), ‘IFC Sustainability Framework: Policy and Performance Standards on Environmental and Social Sustainability’ (Washington: IFC, 2012), p. 8.

91 Office of the United Nations High Commissioner for Human Rights (OHCHR), ‘Guiding Principles on Business and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” Framework’, HR/PUB/11/04 (Geneva: OHCHR, 2011), p. 16.

92 Mary B. Anderson, ‘False Promises and Premises?’, in Oliver F. Williams (ed.), Peace Through Commerce (Notre Dame, IN: University of Notre Dame Press, 2008), p. 125.

93 Ibid., pp. 125–6.

94 Raymond Saner, Lichia Yiu and Mikael Søndergaard, ‘Business Diplomacy Management: A Core Competency for Global Companies’, Academy of Management Executive, vol. 14, no. 1, 2000, pp. 80–92.

95 Brian Ganson, ‘Business in Fragile Environments: Capabilities for Conflict Prevention’, Negotiation and Conflict Management Research, vol. 7, no. 2, 2014, pp. 121–39.

96 Hendrik Kotze, Farmworker Grievances in the Western Cape, South Africa (The Hague: ACCESS, 2014).

97 Elizabeth Borgwardt, A New Deal for the World: America's Vision for Human Rights (Cambridge, MA: Harvard University Press, 2005), pp. 134–135.

98 Ibid., p. 119.

99 Ibid., p. 204.

100 See, for instance, Janice Gross Stein, ‘Proxy Wars – How Superpowers End Them: The Diplomacy of War Termination in the Middle Eas ’, International Journal vol. 35, no. 3, 1980, pp. 478–519.

101 See, for instance, Michael W. Doyle and Nicholas Sambanis, Making War and Building Peace: United Nations Peace Operations (Princeton, NJ: Princeton University Press, 2006).

102 Carla Koppell with Anita Sharma, Preventing the Next Wave of Conflict: Understanding Non-Traditional Threats to Global Stability (Washington, DC: Woodrow Wilson International Center for Scholars, 2003); Commission on Global Governance, Our Global Neighbourhood (Oxford: Oxford University Press, 1995); World Commission on Environment and Development, Our Common Future (Oxford: Oxford University Press, 1987).

103 Malcom Gladwell, The Tipping Point: How Little Things Can Make a Big Difference (New York: Back Bay Books, 2000), p. 9.

104 United Nations Office for the Coordination of Humanitarian Affairs (OCHA), OCHA and Slow-Onset Emergencies (New York: OCHA, 2011), p. 3.

105 Rob Bailey, Managing Famine Risk: Linking Early Warning to Early Action (London: Chatham House, 2013).

106 Interview by Brian Ganson with the regional manager for an engineering services company in Colombia.

107 MIGA, Investment and Political Risk in Conflict-Affected and Fragile Economies (Washington DC: MIGA, 2010).