The Governance of Corporations, Technological Change, and Risk: Examining Industrial Perspectives on the Development of Genetically Modified Crops

Abstract

Why do corporations develop technologies which can be associated with the generation of various environmental risks and how are the technologies that they develop governed by factors within and around firms? The authors examine the factors that have motivated and guided technological innovation, based on an examination of multinational companies developing genetically modified (GM) crops for the European market. The analysis is based on an inherently interdisciplinary approach to the study of innovation, which incorporates factors that are governed endogenously through the processes within companies (that is, strategic decisionmaking) and exogenously through interactions between firms and their external constituents (that is, government policies and regulations, and stakeholder and public perspectives and engagements). It is found that the introduction of GM technologies in Europe has been shaped significantly by public perception and societal reactions. It is also found that the aspects of industry strategies which contributed most to the course of European public opposition to GM crops were: (a) the choice of first-generation GM products; (b) interactions between pesticide-product and biotechnology-product strategies in different companies, and industry's efforts to present their sector and its products as contributing to sustainable development; (c) cultural and world-view differences between companies; and (d) company responses to European biotechnology policies and risk regulation. It is demonstrated that actions which seem rational to individual actors (corporations, governments, public interest groups) can have counterintuitive, and often counterproductive, outcomes in the longer term and when considered from the perspective of interactions within broader governance processes.