Strategic heterogeneity in the global mining industry

The mining industry is global in the sense that its largest companies come from a number of countries, including developing countries. The global nature of the industry raises the question as to whether such a geographically diverse set of firms make similar strategic choices, and what the consequences of these choices are for both firms and nations. In this study, we examine a sample of the twenty-six largest mining firms in the world in order to determine whether they adopt similar strategies. We find a relatively high degree of strategic homogeneity among the world’s leading mining firms, but the presence of firms from developing countries contributes to heterogeneity. We also find that homogeneity is not necessarily associated with higher returns. Paradoxically, firms from developing countries contribute to strategic heterogeneity because they are less diversified, but they are also more profitable. At the same time, the industry continues to consolidate through a series of crossborder mergers and acquisitions. The continuing consolidation of the mining industry worldwide has the potential to further reduce strategic heterogeneity and increase the relative bargaining power of transnational corporations (TNCs). At the same time, the pressures for strategic homogeneity are likely to result in more cross-border acquisitions by mining companies from developing countries.