Business engagement in hybrid political orders: Examples from the Niger Delta

Abstract

In many postconflict contexts, partnerships between a corporation and the state precede the introduction of large-scale investment, especially as these partnerships are essential to acquiring the former’s license to operate. However, in such contexts, the exercise of authority often differs from the assumptions implicit in the Weberian configurations of the state. As a result, local, informal, and nonstate actors unrecognized as formal authorities (e.g., militias, gangs, insurgents, and local organizations and groups possessing localized authority) may exercise governmental authority on those within their sphere of control. These informal authorities have become known in the literature as hybrid political orders. Against this backdrop, companies find that while establishing a formal agreement with state institutions is a significant precondition to operate legitimately in hybrid political orders, it is also necessary to engage with actors that exercise informal forms of authority to secure their social license to operate. However, tensions between these forms of authority can draw companies into a web of conflict and pose significant risks to their operations. Drawing examples from the Niger Delta, this article discusses how interactions between formal and informal authority actors in postconflict contexts can produce different contextual outcomes (e.g., contestation and collaboration) with their own risks to company operations. I offer guidance on how firms can leverage their positions as bridge builders to forge collaboration among contesting actors to reduce violence and manage conflict.