Financial dimension of internationalization: serving two masters

Jeferson Lana (CDAE, Fundacao Getulio Vargas Escola de Administracao de Empresas de Sao Paulo, Sao Paulo, Brazil)
Rosilene Marcon (Graduate Program of Management, Universidade do Vale do Itajai, Biguaçu, Brazil)
Rodrigo Bandeira-de-Mello (Girard School of Business and International Commerce, Merrimack College, Andover, Massachusetts, USA, and Fundacao Getulio Vargas Escola de Administracao de Empresas de Sao Paulo, Sao Paulo, Brazil)
Wlamir Xavier (College of Business, Eastern New Mexico University, Portales, New Mexico, USA)

Corporate Governance

ISSN: 1472-0701

Publication date: 3 April 2017



Drawing on the agency and institutional theory, this paper aims to explore how financial internationalization shapes firm performance through the influence of foreign actors.


By using a unique panel database, composed of over 26,000 curricula and 4,000 corporate reports from approximately 450 Brazilian companies, the effects of financial internationalization were explored in a longitudinal view by using multiple regression analysis with fixed effects.


The results present consistent and non-trivial effects of financial internationalization on firms’s performance. When tested together, foreign ownership showed inconclusive results, foreign directors and depositary receipts showed a positive association with performance and foreign currency debt showed a negative association.

Research limitations/implications

In most cases, the data on foreign stakeholders, foreign directors and foreign currency debt do not address the home country.

Practical implications

Serving the interest of foreign stakeholders from multiple institutional perspectives can be a challenge for managers. The findings of this study provide an opportunity for research focusing on institutional duality and financial internationalization.


This paper extends the prior literature on corporate governance and financial internationalization by investigating the latter on a perspective of firms from an emerging market. The empirical evidence section provides support for the argument that the simultaneous presence of foreign actors in multiple mechanisms of the corporate governance structure impacts the performance of emerging market firms.



Lana, J., Marcon, R., Bandeira-de-Mello, R. and Xavier, W. (2017), "Financial dimension of internationalization: serving two masters", Corporate Governance, Vol. 17 No. 2, pp. 305-320.

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