City Research Online

Commodity Traders in a Storm: Financialization, Corporate Power and Ecological Crisis

Baines, J. and Hager, S. B. ORCID: 0000-0002-1205-3623 (2021). Commodity Traders in a Storm: Financialization, Corporate Power and Ecological Crisis. Review of International Political Economy, doi: 10.1080/09692290.2021.1872039

Abstract

Commodity trading firms occupy a central position in global supply chains and their activities have been associated with financial instability, social upheaval and manifold forms of ecological devastation. This paper examines these companies in the context of debates regarding corporate financialization. We find that since the 2003-2011 commodity boom, trading firms have become less financialized in terms of the source of their profits as they have shifted away from financial activities. However, they have become more financialized in terms of the destination of profits, with dividend and share repurchase commitments reaching new heights after 2015. In view of this finding, we inquire into whether trading firms’ growing commitment to shareholder payouts will encourage them to continue to prioritize short-term returns, or whether instead these firms’ linkages to financial markets will lend clout to financial activists concerned by the long-term environmental and social consequences of their operations. Ultimately, we find several sources of commodity trader resilience which insulate them from shareholder resolutions and divestment campaigns aimed at curbing ecological destruction and human rights abuses in their supply chains. We accordingly suggest that pressures from activist investors must be complemented with more wide-ranging efforts to defend living systems across the planet.

Publication Type: Article
Additional Information: This is an Accepted Manuscript of an article published by Taylor & Francis in Review of International Political Economy on 25 January 2021, available online: http://www.tandfonline.com/10.1080/09692290.2021.1872039
Publisher Keywords: commodity trading firms; ecological crisis; financialization; corporate power; shareholder value; financial activism
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HG Finance
H Social Sciences > HN Social history and conditions. Social problems. Social reform
J Political Science > JA Political science (General)
Departments: School of Arts & Social Sciences > International Politics
Date Deposited: 11 Jan 2021 15:41
URI: https://openaccess.city.ac.uk/id/eprint/25498
[img] Text - Accepted Version
This document is not freely accessible until 25 June 2022 due to copyright restrictions.

To request a copy, please use the button below.

Request a copy

Export

Downloads

Downloads per month over past year

View more statistics

Actions (login required)

Admin Login Admin Login