The Role of Sustainability in CVC A Multiple Case Study of Oil Majors

Abstract

We know from previous research that corporate venture capital (CVC) investments are used by companies as a strategic tool to obtain novel technologies to improve the innovativeness of the corporation. Using a theory building approach, with a mixed method, analyzing a sample of five oil majors, this thesis extends that notion by bringing sustainability to the table and investigating the role that sustainability plays in oil major CVCs. Our findings show that for oil major CVCs, sustainability plays an important role in the screening process and investment decision of ventures. Our research show that oil major CVCs are moving towards making more sustainable investments. Furthermore, we find that sustainability is considered early in the screening process, and that it is used as a tool to access new sustainable solutions. Moreover, our findings propose that oil major CVCs feel both internal and external pressure to change their investment behavior. Lastly, our research proposes that the industry is experiencing a change, with sustainable ventures reaching new heights in number of deals and deal size. Our findings contribute to research in several ways. Firstly, it contributes to CVC research by deploying it in a context novel to CVC research: the oil and gas industry. This is a particularly interesting industry, due to the recent pressure on oil majors to find new solutions to become more sustainable. Further, the addition of sustainability to the corporate objectives for undertaking CVC investments is novel and contributes to the CVC research. Moreover, we contribute to strategic corporate social responsibility (CSR) research by exploring how oil majors strategically use CVC to invest in sustainable ventures. Lastly, we extend the research on CSR through the lenses of stakeholder theory, by proposing that both internal and external stakeholders are pressuring the oil majors to change.