Corruption and its impact on Norwegian-Russian relations

Abstract

This thesis studies corruption in an unconventional manner addressing the impact of corruption on Norwegian-Russian relations. In the thesis I pose the following three research questions:

 Does corruption affect relations between countries?  Does corruption in business affect Norwegian-Russian relations?  Has the Yara-case affected Russian-Norwegian relations – and in case how?

The impact of corruption on relations between countries more generally and particularly on Norwegian-Russian relations are examined through the prism of reputational theory with an emphasis on state reputation. The thesis also includes a case study – the Yara corruption case in Russia. Eight in-depth interviews conducted in Norway and Russia combined with secondary data are used for this purpose.

The phenomenon of corruption has many shapes and dimensions. Many factors affect states’ reputations in the field of corruption and anti-corruption and thus also relations between states. The effects of corruption itself vary a lot from country to country and from case to case. There is therefore a need to study each case separately.

Findings presented in this thesis show that corruption does not pose a threat for, and is far from being a significant problem in current Norwegian-Russian business relations. At present, this is the case due to the structure and character of the Norwegian-Russian cooperation and a number of economic factors. However, corruption affects the development of medium and small-size level business cooperation between the countries.

As for the Yara case, there is little evidence that it has had any significant impact on NorwegianRussian business relations. Even though the case has negatively affected Yara’s reputation, it has not weakened Norway’s reputation within Russia. It also seems unlikely that the case has damaged Russia’s state and business reputation in the eyes of Norwegian businesses.