Leaking legitimacies: the Finnish forest
sector’s entanglement in the land conflicts
of Atlantic coastal Brazil
Susanna Myllyla
¨
and Tuomo Takala
Abstract
Purpose – The aim of this paper is to focus on the legitimacy problems faced by the Finnish forest
industry in the Brazilian context, specifically from the perspective of the region’s indigenous
communities: the Tupinikim, the Guarani and the Pataxo
´
.
Design/methodology/approach – The method used is qualitative research with a case study
approach. The empirical data are based on the fieldwork in the states of Espı
´
rito Santo and Bahia. The
aim was to scrutinize the corporate tactics in gaining societal legitimacy, both in Brazil and in Finland;
these were categorized into thematic groups.
Findings – The legitimacy of the Finnish companies becomes questionable due to the unethical tactics
of their Brazilian business partner, Aracruz Celulose SA. When the company takes its ‘‘marginal’’
stakeholders’ demands seriously and commits itself to them in diverse ways (economically, ecologically
etc.), corporate social responsibility becomes a reality. The search for legitimacy also requires the
company to change its corporate knowledge production systems, and also requires a willingness on the
part of the company to encounter different types of knowledge that are locally attached.
Originality/value – The study offers new information about the relationship between multinational
corporations and local communities in Brazil – especially from the perspective of indigenous
communities. The paper also contributes to legitimation research. Finally, the authors offer some
concluding remarks considering the new cultural environments of Finnish companies operating in the
global South.
Keywords Forestry, Multinational companies, Business ethics, Corporate social responsibility, Brazil,
Finland
Paper type Research paper
1. Introduction
Finland is currently undergoing a fundamental structural transformation in the forestry sector,
with factories closing in the global North and production being shifted to the global South
(see Carrere and Lohmann, 1996; Cossalter and Pye-Smith, 2003). This has been
accompanied by Finnish mass movements protesting unemployment and demanding
corporate social responsibility (CSR) from the forestry industry. The difficult domestic
situation, however, seems to overshadow the circumstances of the new production regions
in the South. What do we actually know about the development impacts of the Finnish
forestry sector in those societies? Branches of global forestry companies are often located in
poor regions that are already struggling with social injustice. Brazil has a lop-sided land
ownership system, and severe human rights violations towards the traditional communities
occur regularly (United Nations, 2005).
Companies in the Finnish forestry sector are increasingly setting up branch operations in
Asian and Latin American countries, where cellulose pulp can be produced more efficiently
as a raw material for global markets. Instead of cheap labor, the main reasons the Finnish
forest industry finds Latin American countries such as Brazil so attractive are not only the
fast-growing eucalyptus species, but also government subsidies, including cheap or free
PAGE 42
j
SOCIAL RESPONSIBILITY JOURNAL
j
VOL. 7 NO. 1 2011, pp. 42-60, Q Emerald Group Publishing Limited, ISSN 1747-1117 DOI 10.1108/17471111111114530
Susanna Myllyla
¨
is a
Researcher and
Tuomo Takala is Professor
of Leadership and
Management, both in the
School of Business and
Economics, University of
Jyva
¨
skyla
¨
, Jyva
¨
skyla
¨
,
Finland.