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Ownership network structure and decision-control behaviour of eight major oil palm companies in Malaysia

Kamaruddin Norfaryanti. 2018. Ownership network structure and decision-control behaviour of eight major oil palm companies in Malaysia. Seri Kembangan : UPM, 191 p. Thesis Ph. D. : Universiti Putra Malaysia

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Titre autre : Struktur rangkaian pemilikan dan tingkah laku kawalan keputusan di lapan syarikat utama minyak kelapa sawit di Malaysia

Encadrement : Roda, Jean-Marc

Abstract : Southeast Asia mosaics of agriculture and tropical forest landscapes have been heavily shaped by the progression of industrial plantations, from colonial times to now. In Indonesia and in Malaysia, the history of corporations undertaking these activities is indissociably from the land cover change, when “clearing the forest and expanding the agricultural frontier” was a colonial policy. For example in most instances, forests where replaced by industrial gambier plantations, then rubber plantations, and finally oil palm plantations, but direct conversions of forests into industrial plantations continue to happen until today. Controversies about deforestation and oil palm sustainability emerged in this context. Most of the land use changes have been made by the biggest of these corporations, which became corporate giants and diversified their activities to almost all sectors of the economy, from automobile to banking and telecoms. In Indonesia like in Malaysia, most of the development of industrial palm oil plantations is under the control of a fistful of giant corporations. Most of today's proposed solutions to curb deforestation by oil palm are market tools such as palm oil trade bans or regulations and palm oil certifications, that are supposed to influence the economic decisions of private actors that are developing oil palm. However oil palm corporations are so diversified and embedded into the national economies, with many other stakes at play than deforestation, that many other factors could influence their corporate decision making, and outweigh the market tools that have been used up to day to try to influence their economic decisions. Works dating from Porter et all suggest that financial factors such as the shape of the network of ownership shares may play more on the corporate decisions than the market itself, while other works suggest that the nature of the financial ownership (government-owned versus privately-owned) is the essential driver of the corporate decision. This work is a pioneering attempt to understand the main structural drivers of corporate decision making of major oil palm plantation corporations. Using network analysis methods, it quantified and analysed the corporate structures of the main players among the oil palm plantation companies in Malaysia. The eight major Malaysian corporations were studied, consisting of 4,331 companies' shareholding data, covering ten levels of shareholding. The corporations are Sime Darby, Boustead, IJM Plantations, Kulim, IOI Corp, KLK, Genting Plantations, and Jaya Tiasa. Network metrics described the financial topologies of the corporations, and did confront their ownership nature such as government-linked companies (GLCs) and family-owned businesses (FOBs) with measurable patterns controlling decision making processes such as structural control and decisions load. Contrary to the expectation, we found that the measurable decision making was not influenced by the ownership nature (whether the corporations is government linked or is privately owned), but was extremely influenced by the financial structure of the corporations, that is their topology such as the number of the companies within the corporation, its more or less hierarchical structure, and the overall size of the financial “pyramid” of the corporation. We also found that the measurable decisions load and structural control seem to predict an intrinsic structural flexibility of the corporations. The implications of these findings could help to rethink the political governance of deforestation and also opens a brand-new field of research for the description and analysis of the deep financial structures that govern the behaviour of corporations. First, this tells us that maybe, understanding and addressing the financial forces that shape the actions of plantations corporations would be more efficient for oil palm and forest sustainability, than antagonising countries and regions through trade bans. Second, we have now a method that allows us to assess and to rank the companies according to their deep characteristics: we can identify the most resilient corporations and prioritize them in order to develop long term sustainable practices.

Mots-clés Agrovoc : Agro-industrie, Elaeis guineensis, Huile de palme, Propriété collective, Secteur agroindustriel, Prise de décision

Mots-clés géographiques Agrovoc : Malaisie

Mots-clés complémentaires : propriété des ressources naturelles

Mots-clés libres : Oil palm plantations, Decision making, Control, Agribusiness, Deforestation, Malaysia, South East Asia, Multinationals, Network analysis, Network metrics, Oil Palm, Ownership structure

Classification Agris : E21 - Agro-industry

Auteurs et affiliations

  • Kamaruddin Norfaryanti, Universiti Putra Malaysia (MYS)

Source : Cirad-Agritrop (https://agritrop.cirad.fr/596245/)

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