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The changing roles of the United Nations (UN) and national institutions have made addressing climate change a critical concern for many multinational enterprises’ (MNEs) survival and growth. This chapter discusses how such institutions, which vary in their nature and characteristics, shape firm strategies for climate change adaptation. Exploring different versions of institutional theory, the chapter demonstrates how and why institutional characteristics affect typical patterns of firm ownership, governance, and capabilities. These, in turn, influence companies’ internationalisation and climate-change strategies. Climate change poses challenges to how we understand firms’ strategic decisions from both an international business (IB) (HQ–subsidiary relations) and global value chains (GVC) (buyer–supplier relations) perspective. However, climate change also provides opportunities for companies to gain competitive advantages – if firms can reconfigure and adapt faster than their competitors. Existing IB and GVC research tends to downplay the importance of climate change strategies and the ways in which coherent or dysfunctional institutions affect firms’ reconfiguration and adaptation strategies in a globally dispersed network of value creation. This chapter presents a perspective on the institutional conditions that affect firms’ climate change strategies regarding ownership, location, and internalisation (OLI), and GVCs, with ‘investment’ and ‘emerging standards’ playing a significant role. The authors illustrate the discussion using several examples from the Global South (i.e. Bangladesh) and the Global North (i.e. Denmark, Sweden, and Germany) with a special emphasis on the garment industry. The aim is to encourage future research to examine how a ‘business systems’, or varieties of capitalism, institutional perspective can complement the analysis of sustainability and climate change strategies in IB and GVC studies.

“First principles” of international business (IB) thinking should be applied systematically when assessing the functioning of internationally operating firms. The most important first principle is that entrepreneurially oriented firms seek to create, deliver and capture economic value through cross-border linkages. Such linkages invariably require complementary resources from a variety of parties with idiosyncratic vulnerabilities to be meshed. Starting from first principles allows bringing to light evidence-based insight. For instance, most companies are not global and even the world’s largest firms rarely change the location of key strategic functions. International new ventures (INVs), emerging economy multinational enterprises (MNEs) and family firms face unique vulnerabilities but also command resources that can be used to create value across borders. The quest for “optimal” international diversification appears to be a futile academic exercise, and in emerging economies with institutional voids, relational networks – and more broadly, informal institutions – are unlikely to function as scalable substitutes for formal institutions. In global value chains (GVCs), many lead firms and their partners have been able to craft governance mechanisms that reduce bounded rationality and bounded reliability challenges, and it is also critical for them to use governance as a tool to create entrepreneurial space. Finally, many of the world’s largest companies have been on successful trajectories toward reducing their climate change footprint for a few decades. But these firm-specific trajectories are fraught with challenges and cannot just be imposed via unilateral, macro-level targets decided upon by individuals and institutions lacking a clear understanding of innovation and capital expenditure processes in business.

This study investigates how firms’ awareness of sustainability affects the revision of their internationalization strategy. Adopting a resource-based view (RBV) approach, the authors argue that sustainable-oriented firms have a higher propensity to de-internationalize (i.e., to go back to their home country) when confronted with the need to relocate foreign manufacturing subsidiaries, as the shortening of value chains would allow the reduction of transportation emissions and enhanced corporate image as green-oriented entities. Furthermore, the authors explore the role exerted by a stringent regulatory setting in the home country on the likelihood of de-internationalization. The empirical test conducted on a sample of relocations performed across European nations in 2002–2014 reveals that multinational enterprises (MNEs) – regardless of their sustainability orientation – have a higher probability to de-internationalize when their home countries have strict institutional contexts in place.

Global value chains (GVCs) have been challenged by several emerging macro-trends during the last years. Among them, sustainability of production and consumption patterns is becoming a central theme given the necessity to mitigate the degradation of the environment and the over-exploitation of scarce natural resources. In this respect, scholars and practitioners increasingly propose the circular economy (CE) approach as a systemic solution to overcome the conventional linear “take–make–use–dispose” model underlying the structure of contemporary global economy. However, the international business (IB) community has introduced the topic of CE only marginally in its debate. The aim of the present study is to fill this research gap identifying the opportunities for integrating IB and CE principles. Thus, the main objective is to investigate whether and how the adoption of the CE paradigm by multinational enterprises (MNEs) may affect activities, geographical configuration, and governance of their relevant GVCs.

The authors address the issue from a conceptual point of view, identifying direct and indirect impacts of CE adoption on GVC, relative enablers, and possible broader implications. Lastly, the authors propose some reflections for future investigations.

This chapter analyzes the efficiency levels of a circular economy (CE) with an emphasis on transaction costs. It examines the governance aspect of CE activities in comparison to the predominant linear value creation. Extant CE research in business studies tends to be descriptive and lacks a theoretical foundation, particularly in understanding CE management. Transaction cost theory explains efficiency in economic organizing, lending itself to the study of arrangements that maximize resource efficiency at continued economic virtue. The conceptualization proposes that CE transaction costs are greater than those within the linear economy (LE), primarily due to the uncertainties about reciprocal dependencies, looping material complexities, exchanging novel information, and increased contracting efforts. Geographically bounded and institutionally homogeneous CE initiatives may curb these rising costs. By bringing efficiency concerns into CE analysis, the chapter demonstrates the applicability of transaction cost theory and highlights CE relevance to international business by pointing out spatial choice implications.

Managers are increasingly finding their organisations being drawn into polarising socio-political issues. While not an entirely novel form of risk for organisations, the ability to avoid this form of risk is eroding, resulting in a new risk environment. This chapter is a conceptual piece that explores why organisations are compelled to address polarising socio-political issues, and how they might navigate issues communicatively through the use of values advocacy. Stakeholder expectations and potential benefits from taking stances on issues result in organisational managers taking stands on polarising, socio-political issues. However, the polarisation creates dangers by risking to intensify the issue division among constituents, causing segments of organisational constituents to turn against the organisation. Values advocacy may be one way to limit the dangers when taking stands on socio-political issues.

Purpose: Significant structural changes are currently occurring in the Indian labour sector. Artificial intelligence (AI) and other emerging technologies are redefining the activities and skill requirements for various jobs in the healthcare sector. These adjustments have been accelerated by the economic crisis brought on by COVID-19, along with other considerations.

Need for the Study: Skills shortages, job transitions, and the deployment of AI at the company level are the three main challenges confronting the Indian labour market. This chapter aims to discuss policy alternatives to address a rising need for health workers and provide an overview of changes to the healthcare sector’s labour market.

Methodology: A review of the available literature was conducted to determine the causes of the widening skill gap despite a vibrant and prodigious young population. The background of the sustainable labour market is examined in this chapter, with a focus on workforce migration and mobility.

Findings: This chapter gives a comparative review of recent policy papers and evidence, as well as estimates of the health workforce and present Indian datasets. Furthermore, it highlights how important it is for all people concerned to invest in today’s workforce to close the skill gap and create better future opportunities.

Practical Implications: This chapter’s findings imply a severe shortage of human intellectual capital in India and a need to bridge this gap in the Indian labour market.

Distances between contexts that a multinational enterprise (MNE) is familiar with and those that it is not familiar with do not hinder the MNE from becoming global. In this sense, distance serves as a barrier between an MNE’s global intentions and its regional realizations. (Multi)regional strategies are a possible expression of an MNE’s inability to approach distances. Considering the managerially relevant distances is essential to analyze the internationalization and the resulting (multi)regional strategies. A deeper understanding of how distance works requires linking distance to micro-foundations. Besides bounded rationality, bounded reliability opens the conceptual pathway toward a deeper understanding of internationalization and (multi)regional strategies.

Introduction: Cost competitiveness, customer focus, and sustainability compliance are essential for new-age firms to survive and succeed in the VUCA market environment. This study examines how automobile corporations have improved cost competitiveness, productivity, and product quality.

Purpose: This study examines the importance of cost competitiveness, customer focus, and sustainability compliance for the long-term survival of organisations in VUCA markets, looking at the practical efforts made by automobile corporations to enhance cost competitiveness, productivity, and quality.

Methodology: The study utilises a comprehensive analysis of the strategies and initiatives implemented by the selected automobile companies. It involves a review of relevant literature, case studies, financial data analysis, and interviews with key industry experts, providing a holistic understanding of the actions taken by these organisations to achieve their goals.

Findings: The study reveals that cost competitiveness, customer focus, and sustainability compliance are critical factors for the long-term survival and success of organisations in the automotive industry. The analysed automobile companies have undertaken practical efforts to improve cost competitiveness, enhance productivity, and ensure high-quality products, enabling them to navigate the challenges and maintain a competitive edge.

Significance: The findings of this study contribute to a deeper understanding of the importance of cost competitiveness, customer focus, and sustainability compliance in the automotive industry. It highlights the need for organisations to constantly monitor both qualitative and quantitative profit to avoid complacency and ensure long-term efficiency. The study’s insights are relevant to businesses operating in other sectors, as they face similar challenges in the VUCA market environment.