TY - JOUR

AB - Purpose The purpose of this paper is to illuminate the hidden process of

collusion among power holders in state-owned enterprises (SOEs) in an emerging
economy, which endures despite comprehensive reforms towards democracy and good
governance. Why are mechanisms of checks and balances not functioning in the way
they should?Design/methodology/approach The analysis is based on in-depth
interviews with board members, executives, politicians, bureaucrats and
representatives from auditing boards involved in the management of SOEs in
Indonesia.Findings The findings reveal practices of collective conservatism,
reciprocal opportunism and normalisation of corruption. The costs of getting into
powerful positions are so high that conglomerate business owners gain control over
the management of SOEs. The authors use the terms “wall-building and gatekeeping”
to explain such cases.Research limitations/implications There is a continuous
process of wall building and gatekeeping occurring among business oligarchs,
bureaucrats and elected politicians in Indonesia. New entrants into the system are
co-opted by the established elite.Practical implications This study shows
collusion, rent-seeking and corruption among political and business elites as well
as top officials in the government hinder good governance reforms in state-owned
Indonesian enterprises.Social implications Collusion and illicit business practices
in SOEs are clearly grounded on wall building and gatekeeping. Tackling this
problem is a precondition for good governance and an improved legal and regulatory
business environment in Indonesia. The ideal separation of powers and the checks
and balances for good governance apparently need more than a democracy to break
through. A further strengthening of the free press and critical academics will be
one crucial contribution.Originality/value There is generally a lack of
understanding of the context of corruption, such as the influence of institutional
and organisational structures. The topic of corruption is also under-researched due
to the difficulty of finding empire evidence. This paper contributes to explaining
why new political and organisational structures, such as a democratically elected
parliament and a particularly designed corruption eradication commission, are not
able to hinder rent-seeking practices and illicit political business in state
agencies.
VL - 14
IS - 5
SN - 1746-8809
DO - 10.1108/IJOEM-08-2018-0433
UR - https://doi.org/10.1108/IJOEM-08-2018-0433
AU - Apriliyanti Indri Dwi
AU - Kristiansen Stein Oluf
PY - 2019
Y1 - 2019/01/01
TI - The logics of political business in state-owned enterprises: the case of
Indonesia
T2 - International Journal of Emerging Markets
PB - Emerald Publishing Limited
SP - 709
EP - 730
Y2 - 2020/12/13
ER -