This paper analyzes how the European Union recalibrated its sustainability-oriented trade regulation in the context of intensifying geopolitical rivalry. Focusing on the 2025 “Omnibus” reform of the Corporate Sustainability Due Diligence Directive (CS3D), it examines a case of policy dismantling in an increasingly geopoliticized trading environment. Drawing on lobbying data, documentary analysis and two waves of interviews with EU policymakers, business actors, trade unions, and civil society organizations, the article shows how that rollback resulted from the interaction between geopolitical pressure, policy coalition rebalancing, and institutional strategies of anticipatory and reactive blame avoidance. Rather than treating “geopolitics” or “competitiveness pressures” as exogenous constraints, the analysis demonstrates how these narratives were mobilized within EU regulatory politics to selectively amplify the voices of certain interests while ignoring or marginalizing others. Conceptually, the article advances the notion of geopoliticized regulatory recalibration to capture how dominant policy coalitions can mobilize geopolitical frames to justify adjustments in regulatory ambition. The findings contribute to research on business power, policy dismantling, and EU regulatory authority by showing how regulation can become reversible in an increasingly contested global economy.
Do geopolitical considerations affect European citizens' attitudes toward incoming Foreign Direct Investment (FDI)? This article draws on existing literature to derive hypotheses about the geopolitical drivers of citizens' opposition to FDI. We test these hypotheses with a conjoint experiment embedded in a survey fielded in the EU's three largest economies: France, Germany, and Italy (N approximate to 4,500). Our micro-foundational evidence shows that three factors consistently shape opposition to inward FDI across all three countries: (1) concerns about relative gains-citizens are more likely to oppose investments that benefit the sending country more than their own; (2) military alliance status-citizens are less likely to oppose FDI from security allies; and (3) EU membership-citizens are significantly less opposed to investments from other EU Member States. Contrary to prior expectations, we find no evidence of a consistent "China effect." Overall, the findings suggest that the EU's recent shift toward a more geopolitical approach to investment screening broadly aligns with the preferences of its public.
The Covid-19 pandemic entailed a historic high in public spending. Some of these resources were channeled through interest organizations, such as business groups and non-profits. In this paper, we gauge potential inefficiencies in their distribution. Funds may be distributed according to the logic of rent-seeking, whereby organizations use lobbying to extract benefits from the state, or a pluralist logic of disturbances, where funding allocation follows organizational grievances. These two logics might even interact, meaning that organizations in need ought to signal their needs through lobbying first. We use data from two survey waves in eight European polities to test these arguments. Our findings provide support for theories of rent-seeking, showing that lobbying activities are associated with increases in public funding, whereas organizations’ needs and survival fears are not. However, our exploration of interaction effects nuances this picture. Our study sheds light on important dynamics behind resource allocation when crisis-related public spending is high.
Work on the relationship between regulation and bribery suggests that bribes are a joint function of the demands of bureaucrats and the supply of business managers willing to pay them. However, due to biases in measurement, empirical work has concentrated on country-level, demand-side drivers, while research on factors that lead businesses to bribe remains theoretically rich but empirically underdeveloped. We contribute to the burgeoning work on the supply of bribery with a formal model that predicts poorly managed firms may strategically initiate bribes because resource constraints and/or poor service quality necessitate shortcuts in regulatory compliance. To test these theories, we present two connected studies. The first demonstrates that the predictions are consistent with cross-national business survey data. The second, a field experiment, randomly assigned firms to management training courses in Vietnam. Using detailed accounting books, we find that firms in the management course paid monthly bribes less than one-fifth the size ($227 less) of the placebo group, and, consistent with our predictions, had higher levels of regulatory compliance.
This article examines the political backlash to “woke capitalism” in the USA in the context of the introduction of anti-ESG legislation across 18 US states. This article asks what this backlash reveals about the evolving power dynamic between business and the state through analysing the problematisation of responsible investment in Florida Governor Ronald DeSantis’ “war on woke.” This article finds that the state frames socially and environmentally responsible investment as the imposition of an ideological agenda by “martini millionaires” at the expense of the democratic will and economic liberty of “everyday Americans.” This article makes a novel contribution to understandings of the power dynamic between business and the state, through a focus on discursive power, and identification of investment as an underexamined arena of political contestation, demonstrating that the trigger for state pushback on “woke capitalism” is when business goes beyond virtue-signalling to embrace systemic change.
