Managing political legitimacy: Multinational mining companies in the Greenlandic political landscape

Commercial mineral extraction in Greenland is seen as potentially very lucrative. However, at present, there are only two small operating mines, despite massive interest from mining companies. This paper investigates how political risk exposure can explain the lack of mineral exploitation projects in Greenland, a demographically small but geographically large country. Political risk is defined here as the lack of pragmatic, moral, and cognitive legitimacy regarding political actors. This paper shows that, despite enjoying widespread pragmatic legitimacy,
companies are struggling with both moral and cognitive aspects when interacting with Greenlandic politicians and administrative institutions. The paper concludes that mining companies could benefit from managing political legitimacy, which would put managers in an improved position to identify how their actions are not aligned with the aims of political actors.