A new species of global corporate risk: social issues, international firm expansion theory and crisis avoidance in the energy industry

International joint venture (IJV) agreements have long been regarded as the preferred method for risk mitigation for firms seeking to expand internationally. However, these agreements often fail to deliver on their promise of risk reduction, resulting in those firms managing conflicts and drawing the firm into a resource threatening crisis. The premise of this paper is that crisis management starts with a good risk reduction strategy. The authors examine two resource extraction firms engaged in an international expansion and how the traditional vehicle for risk reduction (IJVs) failed to avert a crisis that threatened those two firms.