Environmental Liability and Organizational Deviance: Evidence from Informal Rules in a Dam Collapse

The law enforcement approach is inadequate for explaining environmental crimes by corporations when actors deviate from normative institutions but comply with cognitive ones. We will look to a case study of illicit by Brazil´s mining giant Vale S.A by using a multilevel approach that moves from institutional constraints to individual action. Our hypothesis is that these two layers are mediated by a level of organizational deviance, which will be tested empirically. Formal rules regulating corporate behavior both from public sources (environmental protection laws) and internal ones (code of ethics) were insufficient to prevent individual and collective subjects from wrongdoing. Vale S.A protagonized two dam collapses within the same state in a range of four years and neither the billion dollar penalty nor the safety regulation that became stricter deterred misconduct or guaranteed non-repetition despite multiple warnings. Thus, not only institutional structures failed, but compliance with unwritten rules associated with the goals of the enterprise appear to have fostered deviance. With qualitative methods we relay the trajectory of the events that culminated in the collapse of the dam in Brumadinho emphasizing the common biographies of employees and contractors mentioned in court records, to whom responsibility is attributed for the investigated crimes. Whereas our empiric data does not support rational theory claim that perpetrators maximize their personal interests, the outcome of their practices serves the corporations´ ends and were useful until the illegal behavior was disclosed, supporting previous findings (Pohlmann, 2016). Since employees put their lives and freedom at stake while ignoring occupational duties for the sake of the profitability of their employer, even if there have been personal benefits and enrichment they were fostered by the incentive system within the enterprise. We identify a consistent pattern among high-level and lower-ranking officers with long tenure in the company entailing organization-specific learning and commitment to internalized values and norms, which were collectively acknowledged in the socialization process. Results showed interrelatedness between actors in lateral and longitudinal dimensions, within the hierarchy of Vale and among them and safety auditors, an indicator of collusion. Little oversight of ties of inspectors and mining companies has been reported elsewhere in the global South and future research could address the interaction between organizational culture and non-deterring regulations concerning environmental liability in a comparative perspective.