The good, the bad, or the ugly? Corporate strategies, size and environmental regulation in the fish-farming industry

Abstract

This article investigates corporate responses to environmental regulation of fish farming in Norway, the world's largest producer and exporter of salmon. We note a puzzling strategic divergence within the industry: whereas small firms have strongly opposed new standards, large and multinational firms have supported or even demanded stricter regulation. Traditional models for business response strategies can explain this divergence only partly. We develop a supplementary, explanatory perspective focusing on company size and predatory opportunities, to show how large and dominant corporate players can use environmental regulation strategically to strengthen their competitive advantages at the expense of small and weaker rivals. This highlights a neglected dimension of regulatory effects and motives behind corporate demand for strict and costly standards. It also shows how environmental regulations may cause trade-offs with local development concerns, relevant to other natural resource-based sectors evolving from smaller-scale production towards full-fledged industrialization