The second political service provided by firms is to supplement the state’s societal control efforts. When public grievances arise over a project, infrastructure, or plant, the state may politicize the associated firms by demanding their assistance in managing social unrest. Firms play two distinct roles in societal control: serving as allies when the state employs suppression strategies against protesters or acting as scapegoats when the state opts for appeasement strategies.

Private firms are more suited to serve as scapegoats, while SOEs, particularly large and powerful ones, are stronger allies. This distinction arises from differences based on ownership and extent of political capital available to firms. Private firms typically have narrower and more limited sources of political capital than SOEs. In sectors where protests become increasingly frequent and intense, suppression strategies often replace appeasement, leading to a decline in the standing of private firms as large SOEs gain dominance.