Institutional model of integration of transnational corporations into the processes of sustainable development of the agricultural sector

Abstract

The article examines contemporary processes of integrating transnational corporations (TNCs) into the sustainable development of the agricultural sector. It is determined that the ongoing process of transnationalization significantly reshapes the architecture of modern agrifood markets while simultaneously acting as a powerful driver of modernization and a source of substantial systemic risks for national economies. It is evident that overcoming existing institutional gaps and adapting the agricultural sector to ongoing transformations requires moving beyond the traditional perception of TNCs as solely financial investors. Transnational capital is considered an active resource of institutional transformation agents capable of influencing the development trajectories of the entire agricultural sector through the transfer of stringent environmental regulations, ESG practices, and advanced technologies. Analysis of the activities of leading integrated agricultural holdings reveals that their impact on sustainable development has a distinctly institutional character. The formation of flexible institutional arrangements is identified as the primary instrument for overcoming development contradictions. The integration of ESG practices into TNC business models, driven by state regulatory incentives, enables the redirection of private profit-oriented motivations toward addressing national environmental and security challenges. A balanced alignment of strategic objectives across economic efficiency, innovation-oriented development, economic security, and sustainable development substantiates the components of an institutional model for TNC integration. It is noted that the practical implementation of the proposed model requires the introduction of a comprehensive set of modern institutional instruments, including the standardization of financial resources, the development of electronic document management systems, the strengthening of state environmental oversight, and the establishment of formalized institutional agreements on socio-economic partnership among TNCs, public authorities, and local rural communities.