Unmanaged migration and the role of MNEs in reducing push factors and promoting peace: A strategic HRM perspective
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The global migration crisis has prompted calls by the United Nations and others for private sector involvement in migration governance. Drawing on the strategic human resource management (HRM) and peace through commerce literature, we propose that MNEs can mobilize the resources of the firm to reduce migration push factors and promote peace in origin and at-risk countries by adopting peacebuilding as a strategic objective implemented through political CSR and conflict-sensitive HRM within a strategic HRM framework. MNEs that take up this ‘grand challenge’ are likely to benefit from greater stability and lower risk, the development of new markets, and enhanced organizational reputation, legitimacy, and competitiveness. We develop research propositions on the likelihood of MNE adoption. Policy and management implications are provided.
Keywordsmigration push factors business and peace strategic human resource management CSR–HRM relationship stakeholders multinational enterprises
Migration should be a choice, not a necessity. (New York Declaration, September 2016)
The world is witnessing the migration of people on an unprecedented scale. In 2017, the number of international migrants stood at 258 million, up from 173 million in 2000 (IOM, 2018). Many of these individuals migrate by choice, ‘pulled’ for instance by educational and economic opportunities, and play an important role in the social and economic development of both host and home countries through temporary, circular, and permanent migration (Vaaler, 2011). Many, however, are ‘pushed’ from their homes due to economic, social, political, and environmental hardships. As of 2018, more than 70 million refugees, asylum seekers, and internally displaced persons have been forced to move due to conflict, violence, persecution, and human rights violations (UNHCR, 2018). Millions of others have fled their homes due to disasters, climate-induced droughts, poverty, and hunger (Oxfam International, 2018).
A global crisis of ‘unmanaged’ migration is thus unfolding, as many of those forced from their homes seek new lives in foreign lands without going through formal immigration channels. Syria, Afghanistan, South Sudan, Myanmar, and Somalia are currently the largest origin countries (UNHCR, 2018). At great personal cost and risk, migrants from these countries transit through neighboring countries, such as Turkey and Pakistan, often with hopes of traveling to destinations in Europe or North America. Migrants from the Northern Triangle in Central America have also been fleeing violence, economic hardship, and environmental degradation, and generally transit through Mexico seeking asylum in the United States (Moloney, 2018). While some migrant destination countries have opened their borders, many more have sought to restrict the inflow of unmanaged migrants. The challenge of integrating migrants in host countries has sometimes given rise to social and political tensions (e.g., Reade & Lee, in press; Szkudlarek, Nardon, Osland, Adler, & Lee, 2019). Those who suffer most from the global migration crisis, however, are the ones forced from home and subjected to human rights violations, and even death, in their search for a better life (Gebrewold & Bloom, 2016).
The United Nations and others, recognizing that global migration governance requires broad stakeholder partnerships, have called upon the private sector to collaborate with governments and nongovernmental organizations (NGOs) to address both the migration integration challenges in host countries and the drivers of unmanaged migration in origin countries (PwC, 2017; UNGCM, 2018). To date, the focus has been on the former with companies such as Chobani and Ikea hiring and training refugees in receiving countries (e.g., Lagorio-Chafkin, 2018). As important and impactful as these efforts are, they do not address the root causes of unmanaged migration, that is, the adverse economic, social, political, and environmental factors that push people from their countries of origin. This paper focuses on how multinational enterprises (MNEs) can mobilize their resources to address these push factors to “make it easier for people to meet their basic needs and life goals in situ,” a policy priority identified in the migration literature (Gebrewold & Bloom, 2016: 230). This focus is consistent with calls by the UN Global Compact on Safe, Orderly and Regular Migration (UNGCM, 2018) for private sector involvement in advancing the UN Sustainable Development goals in order to reduce migration push factors and promote more peaceful and inclusive societies.
Private sector involvement is considered critical for addressing the factors that drive unmanaged migration due to the relatively high levels of resources and capabilities that businesses possess. MNEs can use their economic power to support peace and development initiatives. In fact, they may be the most influential and economically important organizations in fragile or conflict-ridden countries, and thus most able to effect change (Oetzel & Miklian, 2017). Governments, particularly in countries experiencing political conflict, often do not have the resources, capabilities, or, in many cases, the will to address the factors that drive unmanaged migration. Constructive engagement by the private sector to address these factors can thus make a significant difference (Crane, Matten, & Moon, 2008; Matten & Crane, 2005).
Although the migration crisis is clear and calls for MNE involvement are understandable, it is reasonable to ask why MNEs would choose to get involved. First, MNEs are likely to be impacted by unmanaged migration since its causes and consequences are not limited to a few cases or a limited geographic area. Moreover, the flow of migrants forced from their homes is predicted to continue into the future due to persistent inequalities, political and ethnic violence, and climate change-induced environmental degradation (Castles, de Haas, & Miller, 2014). Thus, for many businesses, avoiding the migration crisis is not realistic. Second, MNE involvement in addressing the cause of unmanaged migration can be expected to provide a number of benefits for the MNE. Through their investments in migration origin and other at-risk countries, MNEs can help to address significant unmet needs for jobs and infrastructure while developing new markets for their goods and services. At the same time, MNEs can benefit through cross-sector partnerships with NGOs, governments, and international organizations who can provide needed guidance in the development of viable plans in support of private sector efforts (Dahan, Doh, Oetzel, & Yaziji, 2010). In this way, MNEs can lower their political, social and economic risk, identify new business opportunities and partnerships, enhance their corporate reputation and social legitimacy, and in the process develop a distinctive source of competitive advantage.
The objective of this paper is to advance theory on how an MNE might mobilize its resources and capabilities to address the underlying factors that drive unmanaged migration, one of the ‘grand challenges’ of our time (Buckley, Doh, & Benischke, 2017), while realizing benefits for the MNE. The UN and others have articulated a role for MNEs in reducing migration push factors, a role which we suggest MNEs can effectively fulfill through a strategic human resource management (HRM) approach. Strategic HRM is a systemic approach for aligning HRM systems and other elements of the organization with corporate strategy to produce beneficial outcomes for the firm’s internal and external stakeholders (Jackson, Schuler, & Jiang, 2014; Jiang & Messersmith, 2018). Our article responds to calls in the strategic HRM literature to extend theory on how HRM can further support the global social responsibility objectives of the firm (Jackson et al., 2014). We do this by drawing from the strategic HRM and peace through commerce literatures to highlight the extent to which HRM systems might act as differentiators in how MNEs can play a role in migration governance. Our proposed strategic HRM framework incorporates ‘peacebuilding’ as a strategic objective of the firm, defined as a commitment to engage with the firm’s internal and external stakeholders in ways that contribute to sustainable development and to peaceful and inclusive societies. The proposed framework suggests that MNEs implement this objective through contextualized HRM and corporate social responsibility (CSR) policies and practices that are responsive to the adverse conditions generally found in migration origin countries and fragile states. We also develop a typology of MNE adoption incentives and related research propositions and discuss the implications for policy. First, we begin with a background section on migration push factors and the business-peace nexus.
Migration Push Factors and the Business–Peace Nexus
Migration can be considered a “natural and predictable response to differences in the countries of origin and destination” that include, for instance, differences in economic opportunity, and in security and human rights (Martin & Widgren, 2002: 4). The migration literature often couches the drivers of migration as push, pull, and network forces (e.g., Martin & Widgren, 2002; Reuveny, 2007). As described succinctly by Reuveny (2007: 658), “network forces affect the move from location A to location B, push forces operate in A and push people to leave A, and pull forces operate in B and attract people to B.” It has been noted that there may be a combination of push, pull, and network factors at play, such as an individual who flees from war to a peaceful destination with attractive economic prospects and a diaspora network (Gebrewold & Bloom, 2016). While these forces may intersect in complex ways, one can generally say that pull forces include economic and educational opportunities, network forces include the presence of family and diaspora connections (Vaaler, 2013), and push factors include wars and persecution. Here, we focus on migration push factors and human displacement, and consider the relationship between migration push factors, societal peace, and the role that MNEs might play in reducing unmanaged migration and promoting peace.
Push Factors and Human Displacement
Unmanaged population movements across borders are often precipitated by violent conflict (UNHCR, 2018), which may include insurrections, terrorist attacks, and war (HIIK, 2019). Such conflicts occur most often in fragile states with weak institutions and poor governance. Yet, underlying violent conflicts are systemic or structural factors that drive unmanaged migration. The drivers of forced migration can be grouped into economic, societal, political, and environmental push factors (Gebrewold & Bloom, 2016; Perry, 2012).
Economic push factors, the most highly researched reason for unmanaged migration (Perry, 2012), involve a lack of economic development. Few jobs, high unemployment, poverty, and a lack of basic healthcare and education prompt people to look for opportunities and a better life elsewhere (Gebrewold & Bloom, 2016). Further, there is reportedly a strong correlation between underdevelopment and violence: resources are scarce, competition intensifies, and violence can erupt as people face desperate circumstances (Fort & Schipani, 2004; HIIK, 2019).
Societal push factors include discrimination or persecution on the basis of ethnicity, religion, gender, or caste, and a lack of social stability (Gebrewold & Bloom, 2016; Perry, 2012). Societal tensions can escalate into ethnic conflict or other forms of identity-based conflict, such as conflicts based on religious affiliations or beliefs. Religious and ethnic-based conflicts continue to be prevalent, particularly in Asia and Africa (HIIK, 2019). People’s emotions, perceptions, and worldviews are tied to group identification and appear to be central to cycles of violence and conflict (Schirich, 2001).
Political push factors include a lack of political representation and participation, and restrictions on freedom of movement, association, and expression (Gebrewold & Bloom, 2016). Widespread human rights violations, corruption, and physical and financial insecurity due to crime and violent conflict contribute to outmigration. In particular, terrorism, as a form of psychological warfare (Friedland & Merari, 1985), can displace people from their communities, such as the experience in Nigeria with Boko Haram. This may be due to a direct threat of targeted violence, as well as to the indirect effects of violence, including disrupted labor markets and agricultural production (Koser & Cunningham, 2017). Cross-border conflict and terrorism from neighboring states and international networks can also be a significant geopolitical push factor in some cases (Perry, 2012).
Environmental push factors include natural disasters and environmental degradation (Perry, 2012). Earthquakes, hurricanes, climate change-induced drought, and lack of potable water are examples of how natural and manmade environmental disasters can increase social instability and push people to migrate. The effects of climate change can uproot people by destroying livelihoods, increasing food insecurity, degrading land and freshwater sources, threatening health, and undermining social capital (Reuveny, 2007; UNFCCC, 2018).
Migration push factors are often interrelated and can both cause, and be made worse by, conflict. To illustrate, researchers suggest that a three-year drought in the Fertile Crescent between 2007 and 2010 served as a catalyst for conflict in Syria (Kelley, Mohtadi, Cane, Seager, & Kushnir, 2015). The drought led to crop failure which in turn led to a mass migration to cities. These events, coupled with the failure of government to address the resulting economic and environmental crises, are thought by some to have created the context for conflict. A similar dynamic is reported to have occurred in Central America, where droughts between 2014 and 2016 left hundreds of thousands of people in need of humanitarian assistance (Leutert, 2018).
As exemplified above, push factors lead to the displacement of people. Displaced persons include those who continue to reside in their country of birth as well as those who have crossed international borders and have not settled permanently (Gebrewold & Bloom, 2016). Countries that host an influx of migrants may themselves be developing countries with limited resources, and may experience conflict as a result. This is because they are less able to absorb migrants in the same way as developed countries (Reuveny, 2007). In other words, while conflict in the origin country may have precipitated the migration, the migration itself may cause or exacerbate conflict in neighboring and other countries along the migration route due to competition over scarce resources, ethnic tensions, rural to urban influx of migrants, induction of migrants by rebels, etc. (Reuveny, 2007). We now examine the relationship between migration push factors, societal peace, and business.
Relationship Between Migration, Peace, and Business
In recognition of the mounting humanitarian crisis surrounding unmanaged migration, United Nations member states adopted the Global Compact for Safe, Orderly and Regular Migration (UNGCM) in December 2018 to address international migration in a comprehensive manner. The UNGCM contains 23 objectives for global migration governance that cover migration protocols, such as making information on laws more accessible; human rights issues, such as combating trafficking; and, most pertinent to the current study, reducing the factors that cause people to flee their countries in the first place, such as violent conflict, discrimination, poverty, and drought. Of particular relevance to business is “Objective 2: Minimize the adverse drivers and structural factors that compel people to leave their country of origin,” which includes creating “conducive political, economic, social and environmental conditions for people to lead peaceful, productive and sustainable lives in their own countries” (UNGCM, 2018: 9). As a stakeholder in global migration governance, the private sector is called upon to support the UN Sustainable Development Goals (SDGs) as a means to reduce the drivers of unmanaged migration, including SDG 16 on promoting “just, peaceful and inclusive societies” (UNSDG, 2015).
When considering the relationship between migration, peace, and business, it is useful to look at the way peace is conceptualized. The peace literature distinguishes between ‘negative peace’ and ‘positive peace’ (Galtung, 1969). Negative peace refers to the absence of direct violence, such as war or terrorism, whereas positive peace refers to the absence of indirect cultural and structural violence, such as poverty, hunger, discrimination, and social injustice (Galtung, 1969). Negative peace is inherently unstable since the structural violence within the system creates the potential for future outbreaks of direct violence. Since systemic issues of inequality and injustice drive unmanaged migration, and present a risk of future violence and greater outmigration, we suggest that ‘peacebuilding,’ or the creation of conditions of positive peace, is necessary to reduce unmanaged migration. While peacekeeping and peacemaking are concerned with stopping direct violence and mediating between conflict actors, the goal of peacebuilding, which is more broadly intertwined with sustainable development, and is thus a more incremental, longer-term process, is to create the enabling conditions for a more enduring positive peace (e.g., Miklian, Alluri, & Katsos, 2019). This is echoed in Objective 2 of the UNGCM.
The potential for MNEs to promote peace in countries where they operate has been recognized in the business and peace literature (e.g., Fort & Schipani, 2007; Kolk & Lenfant, 2016; Miklian et al., 2019; Oetzel & Miklian, 2017; Oetzel, Westermann-Behaylo, Koerber, Fort, & Rivera, 2010; Oetzel & Getz, 2012; Reade, 2015). While businesses have historically been associated more with conflict than with peace, as exemplified by the role of commerce in following the flag under colonialism and mercantilism (Fort & Schipani, 2007), the ‘business–peace nexus’ has garnered more attention as the power and influence of MNEs has grown relative to nation-states, which have generally taken the lead in peacebuilding efforts (Schouten & Miklian, 2018). It is acknowledged that trade and investment can contribute to peaceful societies (e.g., UNGCM, 2018). This is important given the high economic cost of conflict. In Syria, for example, the economic cost of violence was estimated at 67% of GDP in 2018. Other countries have faced similar costs. During the same time period, the cost of violence was reportedly 47% of GDP in Afghanistan, 30% in Venezuela, and 25% in Colombia (IEP, 2019).
Recognizing the high cost of violence, in 1994, the business community in Northern Ireland began to quantify the cost of conflict (Günduz, Banfield, & Killick, 2006: 438–443). The Northern Ireland Confederation of British Industry produced a document that became colloquially known as the ‘peace dividend paper.’ The document encouraged businesses and the wider society to focus on the economic importance of peace rather than solely on the grievances that led to conflict. It argued that the high level of national spending on security and other conflict-related costs could be better spent on education, infrastructure, and research and development, the types of investments that can transform negative peace into positive peace. After the 1994 ceasefire, empirical evidence supported the arguments made in the peace dividend paper. Tourism rose 20% in 1 year, unemployment dropped to its lowest level in 14 years, and there was US$48 million in investments in the region (approximately $81 million in 2018 US dollars adjusted for inflation) (Günduz et al., 2006: 440).
While countries benefit from greater peace and stability, MNEs also benefit. Political and civil violence and other factors that drive unmanaged migration can constrain the operations of, or even drive out, private sector firms who may find it difficult to survive under such conditions (e.g., Hiatt & Sine, 2014). It has long been acknowledged that political, economic, and social stability is critical for corporate growth (e.g., Bennett, 2002). MNEs can promote greater stability through their engagement with governments and other stakeholders in fragile states, and through their investments in addressing unmet needs, providing jobs, and developing new economic opportunities. Even when governments are unable or unwilling to address the causes of violence or to deal with major crises, companies can partner with international agencies and NGOs to help strengthen government institutions and build more resilient communities (Oetzel & Miklian, 2017). An example of this is a major activity undertaken by the courier firm UPS to address global crises and disasters through public–private partnerships. Using their logistics know-how, UPS partnered with the World Economic Forum, the U.S. Chamber of Commerce, and the Corporate Responsibility Association of Turkey to launch the Saglam Kobi project in 2013, which in the first three years provided training to more than 1,400 businesses across Turkey on how to better respond to disasters and crises. UPS benefits not only reputationally but also by reducing risk for its business and for its supply chain partners (UNISDR, 2017). As this example illustrates, MNEs that successfully manage complex risks, build local capacities, and promote greater social stability and resilience, may gain a valuable competitive advantage in terms of lowering their political, economic and social risk, developing new markets and partnerships, and enhancing their corporate reputation and social legitimacy (Oetzel & Miklian, 2017).
In summary, the UN and others have clearly articulated a role for MNEs to contribute to migration governance by addressing migration push factors in origin and at-risk countries. In addition to the expected societal benefits, we have provided examples of the organizational benefits that MNEs might gain from taking on this role. As to how MNEs might play this role, we propose that MNEs adopt a strategic HRM approach that features peacebuilding as a strategic objective, implemented through integrated and contextualized HRM and CSR policies and practices. This approach is presented below along with a typology of conditions under which MNEs are likely to adopt it, and related research propositions.
A Strategic HRM Framework for Reducing Migration Push Factors
Human resource management (HRM) is considered critical for the implementation of an MNE’s strategy (e.g., Schuler, Dowling, & De Cieri, 1993). This is a reflection of the integration of HRM into the strategic management process of the firm which has developed within the HRM field since the mid-1980s (Kaufman, 2015; Paauwe & Boon, 2018). ‘Strategic HRM,’ which emphasizes the strategic role of HRM in meeting business objectives (Paauwe & Boon, 2018), is concerned with HRM systems and their interrelationships with other elements of an organizational system (Jackson et al., 2014; Jiang & Messersmith, 2018). HRM systems can be viewed as management tools that influence outcomes of concern for both internal and external stakeholders of the firm. Strategic HRM, with its heritage of diverse theoretical perspectives including systems theory, resource-based theory, stakeholder theory, and human capital theory, differs most clearly from related fields such as industrial relations because of its close relationship with the field of strategic management (Jackson et al., 2014).
The domain of strategic HRM is broad (Jackson et al., 2014; Paauwe & Boon, 2018). It encompasses the external environment of the firm, which typically includes labor markets, laws and regulations, and market conditions; the internal environment of the firm, including corporate strategy, the HRM system itself, and other organizational elements such as culture, as well as the expected outcomes gained through engagement with internal and external stakeholders. Strategic HRM with its systemic approach is thus an appropriate framework for extending theory relevant to an MNE’s role in reducing migration push factors and promoting societal peace.
We build on the ‘aspirational’ strategic HRM framework of Jackson et al. (2014), who note that work is needed on how strategic HRM can support the global social responsibility objectives of the firm. We extend this theoretical framework through the inclusion of peacebuilding as a strategic objective and the CSR–HRM relationship. This is consistent with recognition in the HRM field of the importance of an ‘outside/inside’ approach that connects HRM with the firm’s broader operating environment and creates value, not only inside for employees but also outside for customers, investors, and communities (Ulrich & Dulebohn, 2015). We therefore consider the CSR–HRM literature (e.g., Cohen, Taylor, & Muller-Camen, 2012; Jamali, El Dirani, & Harwood, 2015; Voegtlin & Greenwood, 2016) particularly relevant for advancing the theoretical development of strategic HRM since the CSR–HRM relationship spans the external and internal aspects of the firm. This relationship recognizes the influence of CSR on HRM, and of HRM’s role in supporting CSR efforts. Moreover, it acknowledges that the integration of HRM policy with CSR policy can contribute to the sustainability of the firm as well as furthering social and economic development in less-developed countries (Cooke, 2011).
Firms are typically concerned with factors in the external environment that impact their business operations, such as local market conditions and labor supply. In the context of migration origin countries and other fragile states, firms will be additionally confronted with adverse economic, social, political, and/or environmental conditions, the same factors that drive unmanaged migration. The presence of any one of these migration push factors, as discussed earlier, may be associated with social instability and often violent conflict. Weak institutions and poor governance make it difficult for governments of fragile states to control events within their own borders. Indeed, their actions may serve to exacerbate the local conditions that lead to outmigration. Such local conditions produce an unstable, high-risk operating environment for the firm which affects its ability to operate effectively and to ensure the safety and wellbeing of employees.
Local and international stakeholders are another important aspect of the MNE’s external environment. As noted earlier, the United Nations and other international stakeholders have increasingly called upon the private sector to play a constructive role in improving migration governance and addressing the challenges of unmanaged migration. MNEs may also find it necessary to manage the expectations of local stakeholders, including governments, community and issue-advocacy groups, suppliers, and consumers (Oetzel & Getz, 2012). Local and international stakeholders may oppose the MNE’s operations in a particular country, or they may offer support and engage in collaborative partnerships with the MNE on issues of mutual concern (Dahan et al., 2010; Doh & Teegen, 2003; Dorobantu, Henisz, & Nartey, 2017).
Internal Environment of the Firm
The external environment influences the firm’s corporate strategy which in turn shapes the HRM system and other elements of the firm’s internal environment. The alignment of the HRM system with corporate strategy is central to the strategic HRM approach (Jackson et al., 2014).
In considering the MNE’s response to local conditions and stakeholders in fragile states, we draw on two strategic orientations discussed in the strategic HRM literature, a shareholder orientation and a stakeholder orientation (Lees, 1997; Paauwe & Boon, 2018). A firm with a shareholder orientation is assumed to pursue a commercial or economic imperative in order to maximize profit and shareholder value. To support such an imperative, the activities and functions of the organization, including the HR function, seek an optimal state of technological and economic efficiency within the firm (Lees, 1997). By contrast, a stakeholder orientation balances the needs, interests, and aspirations of the firm’s various internal and external stakeholders (Paauwe & Boon, 2018). As the firm considers its wider social, political, legal, and cultural environment, its focus shifts from a preoccupation with internal efficiency to gaining legitimacy from outside the organization (Lees, 1997). The stakeholder orientation highlights the firm’s duty or responsibility toward stakeholders and local communities beyond the firm’s shareholders. In short, the shareholder and stakeholder strategic orientations contrast corporate profitability with corporate responsibility (Paauwe & Boon, 2018).
Following this logic, MNEs with a stakeholder orientation are more likely than MNEs with a shareholder orientation to respond positively to calls from the UN and others to help address the push factors of unmanaged migration. This is because MNEs with a stakeholder orientation can be expected to be responsive to conditions in the external environment and the needs and demands of stakeholders beyond their shareholders. Such MNEs are likely to have leaders and other internal stakeholders who see the value, not only to society but to their organization, of corporate engagement in sustainable development initiatives, such as one or more of the UN SDGs, as a means to ameliorate adverse conditions in their external environment and to create shared value (Porter & Kramer, 2011). Some stakeholder-oriented MNEs may go further and assume a broader commitment in line with SDG 16 to “promote peaceful and inclusive societies” and build “effective, accountable institutions at all levels” (UNSDG, 2015). Such firms may explicitly adopt peacebuilding as a strategic objective, defined earlier as a commitment to engage with the firm’s stakeholders in ways that contribute to sustainable development and peaceful and inclusive societies. MNEs operating in fragile states that adopt peacebuilding as a strategic objective are most likely, for reasons articulated below, to mobilize the firm’s HR and other resources to address the structural and institutional conditions that drive unmanaged migration.
By contrast, MNEs with a shareholder orientation are likely to view profit maximization as the primary strategic objective of the firm. When the interests of stakeholders diverge, such firms can be expected to consistently give preference to the concerns of their shareholders. MNEs with the strongest shareholder orientation are likely to hold the view that the firm has no social responsibilities beyond abiding by the law (Friedman, 1962). Such firms may additionally lobby for laws that bring advantages to the firm’s shareholders even as they disadvantage or cause harm to other stakeholders in society. To the extent that firms recognize that their activities have adverse effects on society or the environment, they are likely to pursue a risk-mitigation strategy that protects the firm and preserves its profitability. In any case, shareholder-oriented firms are unlikely to see peacebuilding as relevant to their business operations. This leads to our first proposition:
In fragile states, MNEs with a stakeholder orientation are more likely to adopt peacebuilding as a strategic objective compared to MNEs with a shareholder orientation.
A strategic HRM approach emphasizes the central role of the firm’s HRM system in the implementation of its corporate strategy, reinforced by the firm’s leadership and corporate culture. The HRM system, including the firm’s HRM philosophy, policies, and practices, “influences how an organization deploys its resources to achieve performance goals, how it defines its political responsibilities internally and externally, and how it integrates various stakeholder groups, like employees, families and communities” (Voegtlin & Greenwood, 2016: 189). When peacebuilding is adopted as a strategic objective of the firm, there is a recognition that stakeholders in society may have divergent and difficult to reconcile interests, all the more so in fragile states suffering from ineffective government institutions and profound forms of structural violence, such as poverty, hunger, discrimination, and social injustice (Galtung, 1969). As a result, the HRM system in such firms is likely to support integrated conflict-sensitive HRM and political CSR policies that are sensitive to the tensions and conflicting interests of stakeholders in both the external and internal environments of the firm. Conflict-sensitive HRM is thought to have an indirect, positive effect on peacebuilding (Getz & Oetzel, 2010; Reade, 2015), while political CSR may be considered a more direct means of enacting a corporate peacebuilding strategy.
Conflict-sensitive HRM is grounded in an HRM philosophy that includes values of inclusion, mutual respect, and giving voice to values, and policies that emphasize democratic consultation, consensus-based decision-making, and principled conflict resolution (e.g., Reade & McKenna, 2013). Conflict-sensitive HRM shapes the hiring, training, appraisal, and reward practices of the firm, which are the daily enactments of its HRM philosophy and policies (Jackson et al., 2014). For instance, in a context of social conflict, the firm can ensure that its hiring practices do not deepen or reinforce social divisions, and can provide training to employees on diversity and conflict management. Further, HRM practices that are sensitive to social stresses would include those that are culturally relevant, such as indigenous conflict mediation approaches that are respected in society (Reade, 2015; Reade & McKenna, 2013). Participative decision-making, egalitarian practices, employee support, and integration of employees with diverse backgrounds can ‘nourish a sense of community’ within the company (Fort & Schipani, 2007). Conflict-sensitive HRM practices also enhance employee wellbeing and ensure the safety and security of employees (Bader & Reade, 2018; Bader, Reade, & Froese, 2019; Reade, 2015; Suder, Reade, Riviere, Birnik, & Nielsen, 2019).
The firm’s conflict-sensitive HRM and political CSR practices support and reinforce each other in a relationship of co-creation (e.g., Jamali et al., 2015). For instance, creating jobs to provide needed employment in at-risk areas of the local community entails an integration of CSR and HRM efforts, particularly if the jobs might otherwise be performed offshore or through automation. Such conflict-sensitive job creation entails job design, training, and support for those hired in conflict-affected communities. As another example, employees can be encouraged to volunteer in the community and be rewarded based on their involvement in social impact-related activities. Further, employees can be trained on the rationale and importance of the MNE’s political CSR initiatives, which include not only lobbying governments to advance the firm’s economic interests but also efforts to promote public sector investment in infrastructure, combat corruption, and secure basic human rights, each of which offers a pathway to address poverty and increase social inclusion and stability (Kolk, Rivera-Santos, & Rufín, 2018). As part of the MNE’s political CSR efforts, MNEs can bring the knowledge, capabilities, and scale of the firm to address often difficult and intractable problems (Dahan et al., 2010). They can advocate for responsive and effective governance and use their influence in national and international arenas to advocate for transparent and effective migration policies and procedures. In sum, we suggest that integrated conflict-sensitive HRM and political CSR policies and practices can facilitate the mobilization of the firm’s resources and capabilities to support peacebuilding through a commitment to sustainable development activities. Based on the foregoing, we propose:
In fragile states, MNEs that adopt peacebuilding as a strategic objective, compared to MNEs that do not, are more likely to develop an HRM system with integrated conflict-sensitive HRM and political CSR policies and practices.
For the reasons articulated above, MNEs that engage with internal and external stakeholders through integrated conflict-sensitive HRM and political CSR are likely to generate the most beneficial outcomes over the long term for both society and the organization. Further, we expect that the proposed societal and organizational outcomes will set in motion virtuous circles that reinforce the firm’s commitment to peacebuilding as a strategic objective. That is, positive societal outcomes are likely to enhance relationships with external stakeholders, reinforcing the firm’s commitment to peacebuilding, while beneficial organizational outcomes are likely to reinforce the MNE’s adoption of a peacebuilding strategy through positive assessments by the firm’s internal stakeholders.
At the societal level, MNEs that implement a peacebuilding strategy through conflict-sensitive HRM and political CSR are likely to recognize social and political tensions in society and use their capabilities and resources to encourage greater inclusiveness both within and outside the firm, promote more effective and accountable governance, and contribute to increased social stability. For instance, conflict-sensitive HRM practices within the firm are thought to support employees to build connections across social boundaries that have been frayed by inter-group tensions outside the firm, and model peace-promoting behavior that can be transferred to society (Lee & Reade, 2015; Reade, 2015). Greater social stability is likely, in turn, to encourage MNEs and local businesses to invest in the local economy and result in increased economic opportunity, more inclusive growth, and greater consumer confidence and optimism about the future. Individuals who see the potential to realize their life aspirations in their home community are less likely to migrate in search of a better life. Consequently, MNEs working with other stakeholders to improve social, economic, political, and environmental conditions in these fragile states can, over the long term, contribute to an overall decrease in internal displacement and unmanaged migration.
At the organizational level, MNEs that engage with internal and external stakeholders through conflict-sensitive HRM and political CSR are likely to have employees who are more engaged and therefore more productive in their work, and who experience a greater sense of wellbeing and satisfaction from their contributions to the firm and to the community. In the context of an ethnic-based civil war, for instance, empirical studies have found that conflict-sensitive HRM practices, including the provision of emotional and material support, enhanced employee commitment to the firm (Reade & Lee, 2012), while the greater use of diversified teams lowered employee perceptions of ethnic homophily, suggesting a decrease in ethnic tensions in the workplace and increased information sharing across ethnic lines (Lee & Reade, 2015). MNEs can also benefit by hiring people in conflict-affected countries. Many highly skilled workers may be unemployed or underemployed in fragile states. Given the opportunity to join an MNE with good working conditions and competitive wages, such individuals are likely to be highly motivated and productive employees. Additional positive outcomes for the organization are likely to include enhanced reputation, social legitimacy, and competitiveness and decreased political, economic, and social risk. MNEs can also benefit from cross-sector partnerships that result in the development of new market opportunities and competencies (Dahan et al., 2010). We therefore propose:
In fragile states, MNEs that engage with internal and external stakeholders through integrated conflict-sensitive HRM and political CSR policies and practices, compared to MNEs that do not, are more likely to generate long-term beneficial outcomes for the society and the organization.
MNE Adoption Incentives and Strategic Implementation
We have proposed that MNEs can mobilize their capabilities and resources to address the push factors of unmanaged migration by adopting peacebuilding as a strategic objective implemented through conflict-sensitive HRM and political CSR policies and practices. While firms with a stakeholder orientation are more likely than others to adopt a peacebuilding objective, the question arises: what types of firms are most likely to adopt all or part of the proposed strategic HRM approach and under what conditions? In this section, we offer a typology of MNE incentives for adoption and related propositions.
A Typology of Adoption Incentives
By stakeholder pressure, we refer primarily to pressure from external stakeholders. Stakeholders in the firm’s external environment can be either local or international, and include customers, investors, multilateral organizations, NGOs, and governmental entities (Oetzel & Getz, 2012). Pressure from external stakeholders is likely to be low when there is little awareness among stakeholders of the MNEs activities in a particular country, or little understanding of the relationship between the firm’s activities and local conditions. Conversely, stakeholder pressure is likely to be high if the MNE’s activities are highly visible and well known, and stakeholders are able to clearly link the activities of the firm to local adverse conditions, such as human rights violations, corruption, or social instability. Stakeholder pressure may come either in support of or in opposition to the activities of an MNE (Dorobantu et al., 2017). External stakeholders may offer support and social legitimacy to an MNE by recognizing its contributions to promoting social, political, or economic development or protecting the local environment, or they may criticize the actions of the firm and even call for a boycott of the firm’s products or services. In fragile states, balancing the interests of different types of external stakeholders may be critical to the firm’s operations (Nartey, Henisz, & Dorobantu, 2018). Internal stakeholders, which include the firm’s leadership, managers, and employees, can exert influence on the firm’s corporate strategy by magnifying the pressure of external stakeholders or by serving to insulate the MNE from external pressures when they deem criticisms of the firm as unfounded or ill-informed.
By local embeddedness, we refer to the extent of an MNE’s participation in social networks, the breadth of MNE subsidiary-level engagement in business activities throughout the country, and the degree to which the MNE has made an economic commitment to the country, including its investment time horizon (Aerni, 2018). The level of local embeddedness is likely to be low if the MNE is operating in geographically remote or physically separate locations, when the firm’s activities are conducted in relative isolation from the larger economy and society, or when the MNE’s investment strategy emphasizes quick returns and high capital mobility. Conversely, local embeddedness is likely to be high if the firm has substantial, long-term investments in a country and its business activities are spread throughout the society, with operations in both urban centers and rural communities, and with business activities involving interactions with customers, suppliers, and other stakeholders at multiple locations and at multiple points of contact. At the same time, there may be negative or positive manifestations of local embeddedness. Local embeddedness can entrench MNEs with local elites and lead to behavior that undermines peace, or it can increase their social legitimacy and more readily secure a ‘social license’ to operate in a foreign market (Henisz, Dorobantu, & Nartey, 2014), reducing the transaction costs associated with doing business in high-risk developing countries with great institutional uncertainty (Aerni, 2018). Based on these parameters, we propose:
In fragile states, MNEs that experience high levels of stakeholder pressure, compared to those that do not, are more likely to adopt peacebuilding as a strategic objective.
In fragile states, MNEs that exhibit high levels of local embeddedness, compared to those that do not, are more likely to adopt peacebuilding as a strategic objective.
No Adoption Incentive
Firms that exhibit a low level of local embeddedness and experience a low level of stakeholder pressure are unlikely to be incentivized to adopt peacebuilding as a strategic objective. Firms in extractive industries such as mining may exhibit low local embeddedness because they operate in geographic isolation, working wherever resources are located. MNEs may also operate in relative economic isolation by, for example, being located in Export Processing Zones, with few linkages to local suppliers or customers. In countries where local elites are not accountable to the local public, MNEs may participate directly or indirectly in local social networks of corruption in order to gain access to local resources or markets or in exchange for security guarantees. Such firms may at times even benefit from conflict in fragile states, as appears to have been the case for diamond-mining companies operating in Angola during the civil war (Guidolin & La Ferrara, 2007).
MNEs may tend to rely on the central government’s support and ignore, sometimes at their peril, local stakeholder concerns (Dorobantu et al., 2017). Local stakeholder pressure is likely to be low, due, for instance, to state suppression of dissent from minority or disadvantaged communities. International stakeholder pressure is also likely to be low when, for example, companies provide raw materials or intermediate goods in global supply chains, where impacts at the source are not visible to end users, such as the adverse health and environmental effects from mining lithium for cellphone batteries (Katwala, 2018).
MNEs in this quadrant are likely to adopt strategic objectives focused on the maximization of shareholder value. To the extent that they respond to conflict and instability in their operating environment, they are likely to focus on protecting shareholder interests by lobbying governments for tax concessions or other measures to protect the firm’s physical and financial investments. MNEs in this quadrant may engage in practices that exploit local labor and support government efforts to limit workers’ rights. They are likely to view human resources as a cost to be minimized, and may lobby governments for policies to deregulate workplace conditions to lower costs. Rather than addressing the social, economic, political, or environmental challenges in their operating environment, such firms are instead likely to advance their private interests at the expense of local communities. This leads to the following propositions:
In fragile states, MNEs with no incentive to adopt peacebuilding as a strategic objective are unlikely to develop conflict-sensitive HRM; rather, they are likely to adopt exploitative HRM policies and practices that may exacerbate adverse local conditions.
In fragile states, MNEs with no incentive to adopt peacebuilding as a strategic objective are unlikely to engage in political CSR; rather, they may undermine effective local governance through lobbying for policies that favor their shareholders over local community interests.
Weak Adoption Incentive
Firms that exhibit low levels of local embeddedness and experience high stakeholder pressures are likely to have a weak incentive to adopt peacebuilding as a strategic objective. MNEs in this quadrant, similar to no-incentive MNEs, are likely to operate in relative geographic or economic isolation, and to have a shareholder orientation. However, weak-incentive MNEs may experience a higher level of external stakeholder pressure that leads to their recognition that their business operations can generate social and environmental costs that undermine its reputation and social legitimacy. For such firms, risk mitigation is therefore likely to become an important strategic objective (Buhmann, Jonsson, & Fisker, 2019).
Royal Dutch Shell’s experience in Nigeria offers an example. In the late 1990s, Shell, which began oil exploration in Nigeria in the 1930s, came under immense stakeholder pressure due to its Nigerian operations, where it was accused of condoning human rights violations and offering support to a national government widely viewed as corrupt. Despite Shell’s efforts to appease its critics, external stakeholders “continued to accuse Shell of not using a potentially powerful influence to bring about change” and of ignoring its role in exacerbating local conflicts (Ionescu-Somers & Steger, 2006: 5). Confronted with escalating reputational costs, Shell began a process in 2011 of becoming less locally embedded by selling off its on-shore oil leases in Nigeria and focusing entirely on off-shore oil production, completing this process in 2018 (Bloomberg, 2018). This risk-mitigation strategy enabled Shell to reduce its exposure to the criticisms of local and international stakeholders while continuing to profit from Nigerian oil production.
Since MNEs in this quadrant exhibit low local embeddedness, they are likely to be more responsive to the demands of international rather than local stakeholders. However, when faced with high international stakeholder pressure, particularly if that pressure leads to an oppositional ‘cascade’ (Dorobantu et al., 2017), an MNE is likely to focus mainly on protecting the firm’s reputation by, for example, divesting itself of troublesome holdings as in Shell’s case, engaging in a limited number of CSR efforts to appease critics (Voegtlin & Greenwood, 2016), or simply avoiding investment in fragile states (Aerni, 2018). In any case, the firm’s CSR activities may amount to little more than ‘greenwashing.’ Regarding the HRM system, hiring, training, appraisal, and reward are likely to emphasize transactional relationships between the firm and employees, with a focus on maximizing the profitability of the firm’s local operations (Voegtlin & Greenwood, 2016). We therefore propose:
In fragile states, MNEs with a weak incentive to adopt peacebuilding as a strategic objective are unlikely to develop conflict-sensitive HRM; rather, they are likely to adopt transactional HRM policies and practices that focus on firm profitability as the basis for employee motivation and reward.
In fragile states, MNEs with a weak incentive to adopt peacebuilding as a strategic objective are unlikely to engage in political CSR; rather, they are likely to engage in CSR efforts to appease external critics while lobbying to secure favorable government policies and to mitigate risk.
Moderate Adoption Incentive
Firms that experience a low level of stakeholder pressure and exhibit a high level of local embeddedness are likely to have a moderate incentive to adopt peacebuilding as a strategic objective. External stakeholder pressure may be low if stakeholders have a largely favorable view of the firm and its business activities. International stakeholders may perceive the situation in a particular country as complex and multi-faceted, lending credibility to an MNE’s claims to be doing its best in a difficult situation, while local stakeholders may perceive the need for jobs as outweighing any possible negative effects of the MNE’s operations. Local stakeholder pressure may also be low due to government repression or other constraints.
Given that MNEs in this quadrant are well embedded in society, they are likely to be concerned about their reputation and social legitimacy as well as the negative effects of social instability on their business operations. Firms in this quadrant are therefore likely to operate from a stakeholder orientation and to pursue a strategy that focuses on creating shared value (Porter & Kramer, 2011). In pursuit of ‘win–win’ solutions with internal and external stakeholders, these firms are likely to assume that all stakeholders share similar interests and to overlook the social tensions and contradictions that exist particularly in fragile states (Voegtlin & Greenwood, 2016). Moderate-incentive firms are therefore unlikely to see a need for conflict-sensitive HRM policies and practices, and are more likely to adopt HRM practices that align organizational and employee interests with an inward focus on enhancing employee wellbeing. The CSR efforts of these firms are likely to promote creating shared value within their immediate value chain, missing opportunities for a broader social impact. Without a political CSR approach, firms in this quadrant may not recognize the ways in which government policies that advance their business interests can exacerbate social and political tensions (Voegtlin & Greenwood, 2016).
Nestlé offers an example of a company that over the past decade has pursued a creating share value strategy (Porter, Kramer, Herman, & McAra, 2017). Nestlé, as a consumer food and beverage company, is highly embedded in the countries where it operates. In the past, it had been subject to oppositional pressures to be more socially responsible, particularly around its marketing of infant formula. Nestlé began to refashion itself as a nutrition, health, and wellness company, and, in 2005, the company embraced a creating shared value approach. As Peter Brabeck-Letmathe, the then CEO of Nestlé, proposed to the World Economic Forum in 2004, “We cannot buy the license to operate; it has to come from the creation of value for society” (quoted in Porter et al., 2017: 10). For Nestlé, the creation of shared value rests on a foundation of compliance with local standards and sustainability that focuses on improving nutrition, producing healthy products, ethical sourcing, water conservation, and rural development. Consistent with firms in this quadrant, Nestlé’s priority in addressing these issues is on those SDGs that are “actionable within their (value chain) operations” (Van Zanten & Van Tulder, 2018: 208). Nestlé has yet to take on SDG 16 (Nestlé, 2017), which may indicate that promoting peaceful and inclusive societies falls largely outside its primary business interests. We propose:
In fragile states, MNEs with a moderate incentive to adopt peacebuilding as a strategic objective are unlikely to develop conflict-sensitive HRM; rather, they are likely to adopt internally-focused HRM policies and practices that align the interests of internal stakeholders with the objectives of the firm.
In fragile states, MNEs with a moderate incentive to adopt peacebuilding as a strategic objective are unlikely to engage in political CSR; rather, they are likely to engage in CSR efforts that benefit the firm by creating shared value within their immediate value chain.
Strong Adoption Incentive
Firms that experience a high level of stakeholder pressure and are highly embedded in local communities are likely to have a strong incentive to adopt peacebuilding as a strategic objective. While international stakeholder pressure can be influential, local stakeholder pressure may sometimes play a more significant role in influencing firm behavior (Oetzel & Getz, 2012), particularly if local stakeholders have access to local and global media and are able to coordinate their activities. The type of stakeholder pressure may also matter. MNEs that enjoy a favorable reputation and supportive stakeholder pressure may be more encouraged to adopt a peacebuilding strategy compared to those that receive mostly oppositional pressure because of an overall negative public image.
The influence of stakeholder pressure is likely to be greater the more embedded the MNE is in local social networks. When a company has a substantial and visible presence in a country with extensive local supply chains or distribution networks, maintaining a license to operate is likely to be more critical to MNE subsidiary performance. Highly embedded MNEs may, in fact, be perceived by local stakeholders as if they were domestic companies (Aerni, 2018), increasing the likelihood that the leaders of such firms will seek to engage in both ‘do no harm’ actions that avoid potential negative impacts on a broad range of stakeholders and ‘do good’ actions that benefit society (e.g., Stahl & Sully de Luque, 2014). Recognizing that “sustainable development cannot be realized without peace and security, and peace and security will be at risk without sustainable development” (IISD, 2018), the MNE may adopt a strategy that goes beyond the triple bottom line by placing societal needs at the center of the firm’s strategic concerns, with profitability serving as a means to sustain the organization rather than as an end goal in itself (Szekely & Dossa, 2017). Such firms may adopt peacebuilding as a strategic objective that becomes deeply ingrained in the organizational culture.
Unilever provides an apt example. Since 2010, when Unilever launched its Sustainable Living Plan, the company has committed itself to becoming a “purpose-driven company” that works with other stakeholders to “address the biggest challenges in the world, … transform the system in which business is done,… [and] win the trust of consumers while helping to create societies and economies in which they can grow and succeed” (Unilever, 2018b: Our strategy for sustainable growth). Unilever has engaged in a process of strategic alignment to ensure its business operations are consistent with all 17 of the UN SDGs, including SDG 16 on peaceful and inclusive societies. Of nearly 14,000 companies that have joined the UN Global Compact (UNGC), Unilever is one of 93 companies to commit, under the UNGC’s Business for Peace initiative, to “paying heightened attention to the implementation of the UN Global Compact in conflict-afflicted/high-risk [and] taking action to advance peace – individually or in collaboration with others” (UNGC, 2015, 2019). Unilever’s goal is to directly support efforts to advance the UN SDGs, working in partnership with external stakeholders and engaging in advocacy to bring about transformational change on a systemic scale (Unilever, 2018b).
As exemplified by Unilever, MNEs that adopt peacebuilding as a strategic objective are likely to mobilize their resources and capabilities to address the structural and institutional conditions that drive unmanaged migration in fragile states. The strategic alignment of the HRM system with this objective is likely to lead to the development of conflict-sensitive HRM policies and practices. In Unilever’s case, this is a commitment to develop “a working environment that promotes diversity and equal opportunity,” where employees are encouraged “to speak up and give voice to their values”, and “where there is mutual trust, respect for human rights, and no discrimination” (Unilever, 2018a). Given the spread of their business activities and reputational stakes involved, strong-incentive firms are likely to be aware of and to respond to the impacts of their business operations on local communities, and to engage in political CSR by coordinating their corporate diplomacy and CSR activities. Further, firms in this quadrant are likely to integrate their HRM and CSR policies and practices. Unilever, for example, integrates in its materiality matrix concerns that are internal to the firm, such as ethics, values, culture, and employee wellbeing, and its social responsibilities for protecting human rights, promoting economic inclusion, and paying taxes to support effective local governance (Unilever, 2018b). We propose:
In fragile states, MNEs with a strong incentive to adopt peacebuilding as a strategic objective are likely to develop conflict-sensitive HRM policies and practices in the hiring, training, appraising, and rewarding of employees to promote employee wellbeing, engagement, and inclusion.
In fragile states, MNEs with a strong incentive to adopt peacebuilding as a strategic objective are likely to engage in political CSR in order to build local institutional capacity and to address the social, economic, political, and environmental conditions that undermine social stability and peace.
Policy and Management Implications
The proposed strategic HRM approach, and the conditions under which firms are likely to adopt it, has policy implications for businesses, governments, and other stakeholders, including multilateral agencies and NGOs. For the MNE seeking to adopt peacebuilding as a strategic objective, responsible leaders who embody values that support a corporate culture of peacebuilding play a critical role. Leaders who exhibit cosmopolitanism, or a transcendence of one’s parochial interests and an openness to cultural others, can serve as role models and help to bridge social divisions over politically sensitive issues (e.g., Reade & Lee, in press). At the same time, MNEs that invest in fragile states require a nuanced understanding of their external environment. While MNEs have the resources and influence to make a difference, managers rarely have sufficient internal expertise to act unilaterally. Managers may also be concerned about exacerbating existing problems or drawing too much attention to themselves if they act alone (Oetzel & Getz, 2012). By partnering with knowledgeable local or international NGOs and multilateral agencies, MNEs can obtain the issue expertise they need and, at the same time, maximize the depth and breadth of their impact. In particular, MNEs are likely to confront different challenges depending on whether a country is in the midst of conflict or in a pre- or post-conflict phase.
In the pre-conflict phase, MNEs can take action to mitigate the potential causes of conflict before they become a crisis. As noted earlier, conflict-sensitive HRM practices within the firm can support employees in building connections across social boundaries that have been frayed by inter-group tensions outside the firm (Lee & Reade, 2015; Reade, 2015). Before violence has broken out, companies can promote more stable and peaceful societies through their core business activities as well as political CSR initiatives. MNEs can, for example, ensure that local stakeholder concerns are adequately addressed in national policy discussions (Luis, Ganson, & Wennmann, 2019). By conducting a supply chain audit, companies can also ensure that they are not inadvertently reinforcing social or economic divisions in society that could lead to conflict. MNEs can leverage their economic and political power to advocate for changes in policies that undermine social, economic, and environmental conditions, and also have management expertise that can be tapped to strengthen public sector institutions and build capacity in civil society (e.g., Regnér & Edman, 2014). Conversely, if MNEs scale back their activities when they become skittish about the political situation, their collective actions can increase the likelihood of violence.
Nevertheless, it is important to recognize that remaining in a conflict-affected country is not always the appropriate decision for an MNE. In the midst of conflict, companies can take steps to ensure that employees and their families are safe or aide them if they need assistance (e.g., Bader & Reade, 2018; Reade, 2015), and may choose to exit to save employees’ lives and minimize economic losses (Dai, Eden, & Beamish, 2017). In Venezuela, most MNEs that had been operating in the country prior to the crisis have left (e.g., Clorox, Bridgestone, Kellogg, and General Mills, to name a few) (Pons & Romero, 2018). Many more have scaled back operations. As economic conditions have deteriorated and violence increased, more than 4 million unmanaged migrants have left Venezuela and have sought safety and security in neighboring countries (UNHCR, 2019). Once outmigration has reached crisis levels, there is not much MNEs can do, highlighting the importance of MNE engagement in the pre-conflict or pre-crisis phase. At the same time, even in Venezuela, a significant number of MNEs appear to be strongly embedded in the country, continuing to provide daily lunches and other assistance for those workers who are most in need, even if the company has minimal operations (e.g., Fiat Chrysler). While these actions will not change the overall situation in the country, the people of Venezuela will not forget that the MNEs stood by them in their time of need and did not abandon the country or their workers (Instituto de Empresa, 2018).
In the post-conflict phase, companies can help to reestablish peace and stability in a number of ways. Through political CSR initiatives, MNEs can participate in rebuilding essential infrastructure and promote economic stabilization by resuming trade and investment in key sectors. They can also support efforts to strengthen weakened legal and financial institutions (Bennett, 2002). Likewise, a conflict-sensitive HRM approach can help to rebuild human capital and a “damaged psychological infrastructure” resulting from the breakdown of societal trust and cooperation (López López et al., 2018: 202). MNEs can help those who have been displaced find jobs and other resources, sometimes by hiring them, and in a way that does not exacerbate existing social divisions. An MNE in the manufacturing sector can adopt more labor-intensive practices, providing livelihoods to lower-skilled workers who may otherwise be destitute. At the same time, many highly skilled workers may be unemployed or underemployed in fragile states. Others may lack the necessary certifications or find few job opportunities that match their skills. Working in partnership with government agencies and NGOs, MNEs can provide these marginalized workers with jobs while increasing the skill level of their own workforce. Colombia provides an apt example of the critical importance of the private sector to post-conflict peace processes. A key part of the peace agreement adopted in late 2016 involves the reintegration of former combatants into mainstream economic and political life. Since more than half of these former combatants are illiterate, schooling and job training is necessary for finding work. Coca-Cola FEMSA and the Colombian supermarket chain, Exito, have been corporate leaders in this area. The continuing challenge, however, is finding post-training employment, as companies and individuals are wary of former combatants working side-by-side with those whose families or friends were victims of the conflict (López López et al., 2018; Moloney, 2014; Vietor & White, 2015). Without jobs, however, former combatants may become discouraged and reconsider the benefits of peace, perhaps fueling another cycle of conflict and violence.
For MNEs that have not already committed their resources and capabilities to reducing migration push factors and increasing social stability in fragile states, MNE leaders and managers need to recognize the financial and reputational costs of continued inaction, and the organizational benefits of constructive engagement on these issues. As we have proposed, firms whose business operations are highly embedded in society and subject to external stakeholder pressure are more likely to benefit from such engagement, and therefore more likely to adopt peacebuilding as a strategic objective. Even then, local stakeholders in particular may need to serve as catalysts for private sector action (Oetzel & Getz, 2012). Since managers tend to focus on day-to-day operations relevant to their bottom line rather than longer-term threats that may affect even their future viability, the impetus for change may need to come from others. One strategy for multilateral organizations is to partner with local NGOs to raise the pressure on MNEs to act. At the same time, in addressing complex problems like unmanaged migration, multilateral organizations and NGOs can benefit from having firms as potential partners.
Governments, multilateral organizations, and NGOs, in addition to partnering with MNEs, can through their policy choices create incentives for MNEs to adopt peacebuilding as a strategic objective. For instance, foreign investment and taxation policies that encourage long-term commitments and discourage short-term profit taking can incentivize firms to take a longer-term perspective. Companies with long-term investment horizons are more likely to see the benefits of improving social and economic conditions in fragile states and responding to local pressures. These MNEs are also more likely to recognize the risks of continuing social instability and weak governance institutions. Local and international stakeholders can reward firms that take positive actions to address local challenges by publicly recognizing firms, and their shareholders, when they make long-term commitments to society. Conversely, requiring greater transparency from MNEs regarding their business operations in fragile states, specifically their HRM policies and practices, can both expose inadequate practices to greater stakeholder pressure, and also incentivize and reward firms that adopt conflict-sensitive HRM practices. Ultimately, it is only through a combination of effective internal firm practices and engagement outside the firm that MNEs, working in concert with governments, multilateral agencies, and NGOs, will be able to bring about the transformational changes required to mitigate the factors that lead to unmanaged migration.
We have proposed that MNEs can contribute to global migration governance in origin and other at-risk countries where they operate by taking a strategic HRM approach to reducing push factors and promoting peace. We extend strategic HRM theory by including peacebuilding as a strategic objective and a contextualized CSR–HRM relationship that takes into consideration societal conflict and other drivers of unmanaged migration. While the strategic HRM literature has increasingly highlighted the importance of sustainability (Jackson et al., 2014), the focus has been on the environment (e.g., DuBois & DuBois, 2012; Jackson & Seo, 2010). We have argued that a strategic HRM framework that features a corporate strategy of peacebuilding includes in its scope the potential for addressing the full range of economic, social, political, and environmental sustainability challenges that contribute to push migration.
The proposed strategic HRM framework and related typology offer several avenues for future research. We have suggested that the greatest benefits will accrue to firms that adopt a peacebuilding strategy implemented through conflict-sensitive HRM and political CSR, and have offered a typology of conditions under which MNEs are likely to adopt it. There is a need to further develop and test the mechanisms through which such benefits might be realized, and to consider other factors that might limit MNEs from adopting a strategic HRM approach. For instance, there is empirical evidence to suggest that the propensity for a firm to engage in CSR is affected by firm size and by whether terrorist attacks target businesses or other entities in the community (Abrahms, Dau, & Moore, 2019). Additionally, more work is needed on the mechanisms underlying the CSR–HRM relationship when supporting a corporate objective of peacebuilding, such as the factors that might enhance co-creation between conflict-sensitive HRM and political CSR (e.g., Jamali et al., 2015).
In further developing a strategic HRM framework for reducing migration push factors, consideration should also be given to pressures that are internal to the firm. We have mainly focused on the external pressures that shape an MNE’s strategy and the HRM system. However, in light of demographic changes and the composition of employees entering the firm, it is likely that internal pressures may also have an important influence on the adoption of the proposed strategic HRM approach over the longer term. A new generation of workers is entering the workforce that places increasing emphasis on the social responsibility reputation of a company when deciding where they work, the products or services they purchase, or where to invest (Cacioppe, Forster, & Fox, 2008). As millennials and younger employees move into senior positions in business, such individuals will have a greater say in defining a company’s purpose and priorities (Sorkin, 2019). In other words, those who join MNEs in the future may be increasingly concerned about addressing ‘grand challenges,’ including the economic, social, political, and environmental factors that contribute to unmanaged migration.
Finally, while our strategic HRM framework was conceptualized to support MNE operations in migration origin and at-risk countries, we believe it is also applicable for MNE operations in destination countries. As noted in the business and peace literature, peacebuilding is relevant even in stable countries (Miklian et al., 2019), as such countries may also experience poverty, inequality, and social injustice which can be exacerbated by unmanaged migration and anti-immigrant sentiment. While CSR is a recognized part of improved migration governance in destination countries (e.g., Saltaji, 2017), MNE efforts to facilitate migrant integration are likely to be enhanced by the adoption of integrated political CSR and conflict-sensitive HRM. MNEs would therefore benefit from taking a holistic approach to improving global migration governance. The root causes of the global migration crisis, however, lie in origin countries and fragile states, and there is an important role for MNEs to play in addressing the drivers of unmanaged migration.
We are grateful to guest editor Paul M. Vaaler for his valuable support and guidance, and to the anonymous reviewers for their constructive feedback. We would also like to thank the participants at the 2018 Würzburg International Business Forum for their helpful input on an earlier version of this paper.
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