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“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.

Alain Verbeke is one of the world’s leading thinkers on international business (IB) and globalization, a renowned scholar and educator who contributes to creating a better global business environment by addressing some of today’s most critical challenges. He was one of the first scholars to advance a theoretically rigorous and practically significant perspective on international corporate social responsibility (CSR). Verbeke’s work on international CSR is particularly impactful because it is rooted in IB theory and based on a realistic set of assumptions about the behavior of managers, policymakers, and other market and nonmarket stakeholders. In this chapter, the authors apply theoretical principles central to Verbeke’s research – most notably behavioral assumptions of bounded rationality and bounded reliability – to analyze businesses’ and societies’ pace of progress in relation to stated environmental, social, and governance (ESG) goals. The authors argue that bounded rationality and reliability challenges create misalignment between stated/imposed commitments toward ESG performance, and economic actors’ ability to deliver on these commitments. The authors discuss examples of such misalignment, focusing on tensions among stakeholders, between stakeholder organizations and firms, and within firms. The authors propose that to be relevant for policy and practice, the sustainability research should be based on realistic microfoundational assumptions.

This chapter discusses the global factory paradigm. We show how mainstream international business (IB) thinking, namely, internalization theory, can guide multinational enterprise (MNE) strategic decision-making in the context of a global factory network.

We identify the key assumptions made in the global factory paradigm about the fine slicing of economic activities and the related implications for the ownership status and location of each activity. In order to overcome the global factory paradigm’s relative lack of predictive capacity, as compared to internalization theory, we propose an asset-bundling approach. This approach uses a clear and unambiguous criterion, namely, the tradability of resources (and resource combinations) to determine which sets of activities can best be left to external market contracting or should on the contrary be internalized on the basis of efficiency considerations.

We describe the enhanced role of developing/transition countries in the functioning of the global economy and show that these countries represent an increasing share of worldwide economic activities. Given this macrolevel development, the global factory, as a complex organizational form governing both internal activities and contracts with external parties, is rapidly gaining in importance. We describe, at the conceptual level, the strengths and weaknesses of the global factory and propose a “decision dynamics” matrix to support global factory, senior managers’ strategies in the realm of ownership status and location.

Future research on the MNE should focus on in-depth analysis of firms that embody “global factory”-type characteristics in order to understand better the evolution of this type of company and to capture the close requisite links among the focal firm, external contracting parties, and the broader environment. Such research should also lead to a better understanding of innovative resource combination processes and the transferability of non-location-bound firm-specific advantages (FSAs) across the global factory network.

In the global factory, the MNE head office assumes the role of resource orchestrator and is responsible for key strategic decisions on ownership status and location. Here, the head office must assess critically the operations that are part of the MNE’s value chain and reflect on the firm’s international dispersion of economic activities on an ongoing basis, given a myriad of broad environmental changes and changes in external competitive pressures. Our “decision dynamics” matrix provides a simple but effective managerial tool supporting MNE ownership status and location decisions, but the head office’s capability to make these decisions should not be overestimated.

We explicitly link internalization theory with the global factory paradigm and explore unresolved issues in the relevant literature. Internalization theory prescribes the optimal ownership status and location for each economic activity considered. The theory focuses on the bundling of firm-level resources and complementary ones held by external parties, for each fine-sliced economic activity. It also considers explicitly the nature of the linkages among these activities.

We develop a concept of the global factory, first introduced by Buckley and colleagues (2004, 2009, 2010, 2011, 2014), as a stand-alone construct associated with significant predictive capacity, discuss dynamics of success of the global factory, and identify and analyze social mechanisms deployed by the lead firm head office.

We conceptualize the global factory as a form of a flagship network and augment internalization theory with insights from interorganizational networks research to explore the dynamics of the global factory’s origination and functioning.

We clarify under what conditions a global factory-type network is more likely to emerge and describe social mechanisms generated by the lead firm head office to help the global factory sustain itself and thrive. We argue that in order to benefit from potential efficiencies of the global factory, the lead firm head office must deploy combinations of social mechanisms. We further argue that the role of the lead firm head office is that of a joint value orchestrator and a social broker, in addition to the controlling intelligence function.

Future work on the global factory should include further conceptualization of social mechanisms deployed by the lead firm, exploration of operating mode heterogeneity within the global factory, and large-scale empirical research.

Lead firm managers should embrace the role of the joint value orchestrators and implement social mechanisms described in this chapter to facilitate smooth operation of the global factory.

Global factory governance further increases multinationals’ geographic reach and market power; yet, it is not a universal recipe for market success, and therefore global factories’ power to shape the global economy should not be overestimated.

By linking the global factory to networks literature, we have suggested a novel way to view the concept and articulated more fully its underlying assumptions. Further research on the global factory will help advance our understanding of the dynamics of the global economy and the role of multinationals, their head offices, and their managers in shaping the economy.

Why is it that, despite repeated claims that digital-content firms and internet-based businesses can internationalize everywhere almost instantly, many seem unable to profitably expand outside their home markets? Why have emerging market firms (EMNEs) caught up with established developed-country multinationals (DMNEs) so much faster than expected? In this chapter, the author argues that the clue to these two puzzles lies in the realization that, contrary to the dominant view in the international business (IB) literature that focuses only on the intangibles exploited by DMNEs and assumes that these firms are free to unilaterally decide on their mode of entry and operation, doing business in a foreign country is only possible if intangibles are bundled with complementary local resources, usually held by local firms. Taking into account these complementary local resources and their owners makes it clear that DMNEs are not always free to choose their entry mode but must enlist the cooperation of local resource owners. The need of digital-content and internet-based firms for local complementary resources also explains why they sometimes experience problems when expanding abroad. Lastly, control of complementary local resources provides EMNEs with a home advantage against DMNEs competing with them in their home market. The author shows how EMNEs can capitalize on this advantage to obtain the intangibles they lack and need. The fact that these advantages are available on efficient global markets, while complementary local resources are not, explains the surprising speed of EMNE catch-up.

The purpose of this chapter is to explore the mediating effect of consumer attitude towards purchasing organic food and moderating effect of consumer innovativeness on the intention to purchase organic food. A consumer survey was conducted with a specific focus on buyers of organic food products in Bosnia and Herzegovina. Data were collected during December 2016 via an online survey, eventually obtaining 173 valid questionnaires for analysis. The indirect effect of organic food knowledge, subjective norm, personal norm, organic food availability, attitude towards organic food and organic food scepticism on intention to purchase organic food was tested using the PROCESS Macro in SPSS. The results revealed that organic food knowledge, subjective norm, personal norm, attitude towards organic food have indirect effects on consumer intention to purchase organic food. Moreover, findings suggest that attitude towards organic food purchase mediates the link between these four factors and consumer’s intention to purchase organic food. In addition, it was proven that consumer innovativeness positively moderates the attitude-purchase intention link in the context of organic food consumption. This chapter enhances the external validity of previous empirical findings beyond the Western European context. Further, it provides some important guidelines to the retailers to develop and implement marketing strategies for organic food products.

The purpose of this paper is to explore the domain relevance of a comprehensive yet almost overlooked theoretical framework for studying organic food purchase behavior in a global context. This conceptual paper argues that there exists an apparently powerful model in health behavior domain that may readily be brought into organic food purchase behavior research. The paper argues for domain relevance and proposes that Montano and Kasprzyk’s integrated behavior model may readily be used in organic food behavior studies with some relevant modification.

The paper follows an exploratory approach and shows how variables used in the past may be aggregated to the model in question. The challenge is addressed by following both the inductive and the deductive reasoning. Deductive reasoning calls for investigating whether such behavior may be classified as health behavior. Inductive reasoning calls for proving relevance of all the variables in the aforesaid model to the organic food research context.

The paper concludes that the Montano and Kasprzyk’s model is theoretically relevant to the organic food behavior domain. However, it is observed that the domain-specific operationalization is necessary for further empirical studies.

Since the model was rarely tested empirically in predicting organic food purchase intention, the variable-specific relevance may not warrant the relevance of the whole model with intertwined relationships at the same time.

The paper may pave a way toward further empirical research and may also explain the apparent intention-behavior gap as often reported in literature.

The paper may provide a useful direction in future organic food purchase behavior studies by showing the domain relevance of an apparently powerful model, along with addition of some newer variables that may enrich the existing model.

The purpose of this paper is to investigate the impact of consumers' health beliefs, health involvement, and risk perception on fish consumption behaviour in five European countries.

Cross‐sectional data were collected through a pan‐European consumer survey (n=4,786) with samples representative for age and region in Belgium, The Netherlands, Denmark, Spain and Poland. First, the cross‐cultural validity and cross‐cultural differences in health beliefs, health involvement and risk perception in relation to fish have been tested. Next, structural equation modelling (LISREL) was used in order to simultaneously estimate the strength and direction of relationships between health beliefs, health involvement and risk perception in relation to fish consumption.

Health involvement links up indirectly with subjective health and with total fish consumption, in both cases through increased interest in healthy eating. Interest in healthy eating positively and directly influences fish consumption. Increased risk perception from fish consumption negatively influences consumers' subjective health, as well as consumers' total fish consumption. Finally, subjective health positively relates to satisfaction with life.

This study focused on fish as a product category, and included only a limited number of attitudinal constructs.

This paper provides a unique model relating health beliefs, health involvement and risk perception to fish consumption, which has been tested and validated using a large pan‐European consumer sample.

The purpose of this paper is to investigate consumer attitudes towards and interest in enriching processed meat with healthy ingredients (“functional processed meat”).

Seven focus groups across age and gender were conducted. Discussions were analysed using an inductive thematic approach.

Strategies that participants felt as important for improving the healthiness of processed meat mainly included the use of better quality meat and less salt, fat, preservatives and other additives. “Functional processed meat” was a new concept for participants. Four themes were constructed to reflect participants’ attitudes towards functional processed meat: opposing views on processed meat as a carrier of healthy ingredients; belief in the health benefits of functional processed meat; perceived value of functional processed meat for different consumer groups; and trust and perceived risk surrounding the functional food concept. A large proportion of the participants were unconvinced about the concept of functional processed meat; however many of the participants expressed an openness to purchase this food product if taste and price remained uncompromised.

The sample size of the current study is small. Complementary quantitative research with a more representative sample should be implemented. Adopting a quantitative approach, the findings from this study should be explored further to investigate their application in a representative sample of the population.

This study represents a first exploratory investigation of consumer views on functional processed meat. It can inform further consumer and market research in relation to the development of “healthier” processed meat.

The purpose of this study is to examine the functional relationships among terminal and instrumental values, environmental consciousness and behavioral intentions for green products in India in light of the value–attitude–behavior framework.

This study adopts a hypo-deductive research design. A conceptual model was developed to relate the terminal and instrumental values to environmental consciousness and behavioral intentions, which are substantiated with a comprehensive literature review. Covariance-based structural equation modeling was used along with Anderson and Gerbing’s two-step research approach to measure the dimensions of the measurement model, as well as the specifications of the structural model.

The findings of the research indicate that terminal and instrumental values significantly influence environmental consciousness, and environmental consciousness has a significant influence on behavioral intentions. Instrumental value shows a greater influence on environmental consciousness and behavioral intentions, rather than terminal value. Furthermore, this study discloses that environmental consciousness acts as a partial mediator while establishing a link between instrumental/terminal value and behavioral intentions.

The present research is based on two distinct forms of human values, namely, terminal values and instrumental values. The study found that consumers who favored instrumental values to terminal values revealed a tendency to frame confused and incoherent judgments on environmental issues.

The study will help green marketing practitioners understand the important role of values, that is, both terminal and instrumental values, in promoting environmental consciousness and behavioral intentions for green products. The findings of the study will facilitate decision-making processes in relation to marketing for green product consumers in the Indian context.

Values are the guiding forces for human behavior, both socially and individually. Moreover, values have a long-lasting impression on consumers in varied forms. This study will pave the way forward by contributing to the societal understanding of consumer values within the realms of human values for green marketing, green consumerism and sustainable businesses.

The paper is the first attempt of its kind to explore the relationships among two distinct forms of values that are the foundation of human values, namely, terminal and instrumental values, and their effect on environmental consciousness and behavioral intentions for green products in the Indian market. The paper is unique in understanding factors contributing to green marketing beyond consumer values and differs from previous research in specifying the significance of human values.