Emerging-Market Multinational Corporations as Agents of Globalization: Conflicting Institutional Demands and the Isomorphism of Global Markets

Abstract

We view emerging-market multinational corporations (EMNCs) as agents for global isomorphism. EMNCs seek to enter developed markets not only to expand their business operations but also to acquire advanced knowledge to enhance their core competencies. In entering these markets, EMNCs are subject to coercive, normative and cognitive pressures as they seek legitimacy. Once these firms gain legitimacy in advanced markets through the adoption of local business practices, they transfer these approaches to their headquarters in developing markets, establishing best practices in their home markets. Further, EMNCs may engage in efforts aimed at changing the institutional environment in the developing market to facilitate the transfer of learned practices from the developed market. Thus, we propose that these best practices lead to global isomorphism, but also note instances where symbolic adoption of developed market practices may slow the isomorphic process.

Citation

Liou, R.-S., Rose, A.S. and Ellstrand, A.E. (2012), "Emerging-Market Multinational Corporations as Agents of Globalization: Conflicting Institutional Demands and the Isomorphism of Global Markets", Tihanyi, L., Devinney, T.M. and Pedersen, T. (Ed.) Institutional Theory in International Business and Management (Advances in International Management, Vol. 25), Emerald Group Publishing Limited, Leeds, pp. 179-206. https://doi.org/10.1108/S1571-5027(2012)0000025015