Inter-firm convening and organisational power: How American multinationals mobilised the Venezuelan business community to adopt CSR practices, 1961–1967

Abstract

In the 1960s, political threats drove petroleum multinational corporations in Venezuela to deploy highly sophisticated defense strategies. The American industry leader, Creole, wanted the local business community to adopt corporate social responsibility (CSR) identities and practices as a buffer against state intervention and communist uprising. How would Creole instigate such field-level organisational transformation? By addressing this question through theoretically informed historical narration, I endeavour to extend institutional theory into the world of inter-firm mobilizations for institutional creation and change. Such mobilizations are organised through inter-firm convening: a mechanism through which organisations mobilise – based on the establishment of a special-purpose meta-organisation – to address external challenges by modifying collective identities, remodelling forms of organisation, and diffusing practices in their field. (In Venezuela, this meta-organisation was called Dividendo.) By using this centrally coordinated form of mobilisation, the project’s agenda setters can exert transformative influence on the identity and behaviour of potentially numerous other organisations. I discuss implications for the study of institutional work, organisational power, and global diffusion. The article promotes a corporate and management-centred perspective on CSR, Latin American, and Cold War historiography.

Keywords:

• Institutional theory
• institutional work
• corporate social responsibility
• multinational corporations
• organisational power
• business associations
• Venezuela
• Latin America
• Cold War

Acknowledgements

I would like to thank my friends and colleagues Daniel Kinderman, Gregory Jackson, and Michal Frenkel for all their assistance to me in this project. I also thank editor Stephanie Decker and the anonymous reviewers for their useful advise and kind support.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes on contributors

Dr. Rami Kaplan is an organizational and historical sociologist at Tel Aviv University. He has studied the global diffusion of corporate social responsibility practices—from their initial institutionalization in the immediate post-WWII USA, to their early diffusion in the 1960s-1970s into the postwar Venezuela, Philippines, and Britain, to their post-1990 spread worldwide.

Notes

1 A historical case in point analyzed by Collins (1981; see also Kaplan, 2015) is the business mobilization in postwar United States, led by the Committee for Economic Development, to shape the Employment Act of 1946, thus facilitating the institutionalization of a conservative version of a Keynesian economy during that period.

2 Unfortunately, Dividendo has no proper archive. The primary historical materials supplied to the author had sat on shelves in the Caracas headquarters.

3 The rebels’ failure to fuel popular dismissal of the late-1963 elections would eventually bring the uprising to an end (in 1964).

4 According to Wilkins’s (1975, p. 318) interviews with oil executives in Venezuela, the smaller oil producers felt that Creole “went too far in its aid to Venezuela,” as they could not afford to be as generous. Wilkins’s impression, among many other indicators, suggests that Creole was clearly the leading champion and importer of CSR into Venezuela at the time (cf. Kaplan & Kinderman, 2017).

5 Rockefeller was a Standard Oil shareholder and member of its founding family. He was a businessman, philanthropist, and diplomat who spent part of his career in Venezuela.

6 Mendoza served as a director in the Company for Venezuela’s Development, Rockefeller’s social enterprise, and Rockefeller was a director in the Mendoza Foundation (Rivas, 2002, p. 29; Turner, 1979, p. 302).

7 Local business support was sometimes very enthusiastic, so much so that the Chamber – seeking “to avoid a direct identification of our Cámara [Chamber] or the industry with these positions” – had to restrain it (qtd. in Bonilla, 1970, p. 299).

8 Bonilla (1970, p. 295) reports that the PMNCs preferred to entrust the firm’s relations with government agencies, labor unions, and business associations to senior managers of indigenous origin.

9 Of the total corporate member allotments, a fraction of an unclear size was to go to Dividendo’s pool. The extent to which Dividendo’s members actually respected this obligation remains unknown.

10 Agent Kaplan’s specialty was counter-socialist action through community development programs in the global South (Immerwahr, 2015, pp. 123–125). As mentioned above, in these years targeted counter-communist social aid was becoming a central element of American foreign policy in Latin America (Lieuwen, 1966, ch. 5), providing context for – and, in the case of Kaplan, direct support to – the focal inter-firm CSR mobilization.