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1 – 10 of over 17000Ayse Olcay Costello and Thomas G. Costello
To better understand the relationship between the headquarters and subsidiaries of multinational corporations, we introduce and test a theoretical framework that builds on and…
Abstract
To better understand the relationship between the headquarters and subsidiaries of multinational corporations, we introduce and test a theoretical framework that builds on and extends the positive agency theoretic corporate governance literature. Results indicate that there are three types of subsidiary bundles of corporate governance mechanisms that are used by multinational corporations. In addition, the following factors can help predict what type of subsidiary bundle a multinational corporation will use to align the interests of its headquarters with a particular subsidiary: the multinational corporation’s international strategy, its subsidiary’s importance, environmental uncertainty faced by its subsidiary, and its subsidiary’s age.
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Jorge Juliao-Rossi, Mauricio Losada-Otalora and Diego Fernando Católico-Segura
This study aims to examine how corruption influences the voluntary disclosure of corporate governance (CG)-related information by developed country multinationals (DC-MNEs) and…
Abstract
Purpose
This study aims to examine how corruption influences the voluntary disclosure of corporate governance (CG)-related information by developed country multinationals (DC-MNEs) and emerging market multinationals (EM-MNEs) investing in six Latin American countries.
Design/methodology/approach
The study uses information from 300 MNEs included in the 2018 ranking of the 500 Largest Latin American companies (America Economía, 2018). Each MNE’s final annual report for the financial year ending 2018 was examined and coded to obtain the corporate governance disclosure index. Fractional probit regression was applied to test the hypotheses of the research.
Findings
DC-MNEs disclose more CG-related information in corrupt environments than EM-MNEs. This differentiated behavior occurs because DC-MNEs face higher legitimacy pressures in corrupt environments than EM-MNEs and because EM-MNEs are more experienced than DC-MNEs in dealing with such corrupt environments.
Practical implications
While both EM-MNEs and DC-MNEs need to continue investing in corrupt countries to grow, they need to disclose CG-related information as a strategic tool to manage the legitimacy issues triggered by corruption in the markets they operate.
Originality/value
Despite corruption being pervasive in emerging markets, its implications for firms’ strategic behaviors are still under-researched. This paper extends the scope of corporate governance and international business fields by studying how MNEs respond to relevant dimensions of the macro environment. This research shows that voluntary disclosure of CG-related information is a strategic response of the MNEs to gain legitimacy in corrupt environments.
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While there is some agreement on the usefulness of systems and complexity approaches to tackle the sustainability challenges facing the organisations and governments in the…
Abstract
Purpose
While there is some agreement on the usefulness of systems and complexity approaches to tackle the sustainability challenges facing the organisations and governments in the twenty-first century, less is clear regarding the way such approaches can inspire new ways of governance for sustainability. The purpose of this paper is to progress ongoing research using the Viable System Model (VSM) as a meta-language to facilitate long-term sustainability in business, communities and societies, using the “Methodology to support self-transformation”, by focusing on ways of learning about governance for sustainability.
Design/methodology/approach
It summarises core self-governance challenges for long-term sustainability, and the organisational capabilities required to face them, at the “Framework for Assessing Sustainable Governance”. This tool is then used to analyse capabilities for governance for sustainability at three real situations where the mentioned Methodology inspired bottom up processes of self-organisation. It analyses the transformations decided from each organisation, in terms of capabilities for sustainable governance, using the suggested Framework.
Findings
Core technical lessons learned from using the framework are discussed, include the usefulness of using a unified language and tool when studying governance for sustainability in differing types and scales of case study organisations.
Research limitations/implications
As with other exploratory research, it reckons the convenience for further development and testing of the proposed tools to improve their reliability and robustness.
Practical implications
A final conclusion suggests that the suggested tools offer a useful heuristic path to learn about governance for sustainability, from a VSM perspective; the learning from each organisational self-transformation regarding governance for sustainability is insightful for policy and strategy design and evaluation; in particular the possibility of comparing situations from different scales and types of organisations.
Originality/value
There is very little coherence in the governance literature and the field of governance for sustainability is an emerging field. This piece of exploratory research is valuable as it presents an effective tool to learn about governance for sustainability, based in the “Methodology for Self-Transformation”; and offers reflexions on applications of the methodology and the tool, that contribute to clarify the meaning of governance for sustainability in practice, in organisations from different scales and types.
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Osman El-Said, Heba Aziz, Maryam Mirzaei and Michael Smith
It has been more than 20 years since the idea of binding multinational corporations directly to international law was abandoned. Since then, concerned actors have sought to manage…
Abstract
Purpose
It has been more than 20 years since the idea of binding multinational corporations directly to international law was abandoned. Since then, concerned actors have sought to manage corporate conduct through voluntary regulation. However, little is known about the instruments produced in this regard. This study aims to understand the properties of the instruments that govern or regulate corporate social responsibility at the international level.
Design/methodology/approach
Systematic literature review and content analysis methods were combined to compile a list of 229 international corporate social responsibility instruments (ICSRIs) produced by intergovernmental (IGOs) and international nongovernmental (INGOs) organizations. These instruments were categorized according to an adapted classification framework.
Findings
The majority of instruments from our sample are produced by INGOs, focus on management activities and are applicable to specific industries. The most common issues addressed by the instruments are related to worker protection, human rights, governance and the environment. A limited number of instruments specify stakeholders’ involvement or feature an external orientation. Instruments rarely address issues related to product quality and safety, economic contribution or social performance.
Practical implications
Without a comprehensive overview, it has been difficult to develop broad-based understandings about voluntary regulation as a mechanism for controlling corporate conduct internationally. This study’s findings offer valuable insights, allowing policymakers and industry practitioners to understand the effectiveness of, and make appropriate enhancements to, ICSRIs.
Social implications
By enhancing ICSRIs to address the limitations highlighted in the current study, multinational corporations can be induced into contributing more productively to the sustainable development of the societies they impact and play a greater role in the realization of the Sustainable Development Goals.
Originality/value
Previous research has largely concentrated on analyzing small numbers of carefully selected instruments in a conceptual or descriptive approach. In contrast, this study represents a novel approach of systematic compilation and quantitative classification for a comprehensive list of ICSRIs.
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Ruth V. Aguilera is an associate professor and a Fellow at the Center for Professional Responsibility for Business and Society at the College of Business at the University of…
Abstract
Ruth V. Aguilera is an associate professor and a Fellow at the Center for Professional Responsibility for Business and Society at the College of Business at the University of Illinois at Urbana-Champaign. She also holds courtesy appointments at the School of Labor and Employment Relations, the College of Law and the Department of Sociology at Illinois. She received MA and PhD degrees in Sociology from Harvard University. Her research interests fall at the intersection of economic sociology and international business, specifically in the fields of comparative corporate governance, foreign location choices and corporate social responsibility. She has published in the leading journals in International Business and Management. Dr. Aguilera currently serves as a member of an associate editor of Corporate Governance: International Review and is a member of the Editorial Boards of the following peer reviewed top tier journals: Academy of Management Perspectives, Global Strategy Journal, Journal of International Business Studies, Journal of Management Studies, Management International Review, Organization Studies and Strategic Management Journal. She also serves in the board of IMDEA Social Sciences (Madrid) and CSR IMPACT Project (Brussels).
This study aims to discuss an argument that the social value creation of multinational enterprises (MNEs), beyond creating economic value for the shareholders, could be the next…
Abstract
Purpose
This study aims to discuss an argument that the social value creation of multinational enterprises (MNEs), beyond creating economic value for the shareholders, could be the next “big question” for international business (IB) research. The authors also provide examples of promising research topics associated with this research agenda.
Design/methodology/approach
The paper is conceptual.
Findings
Although a new paradigmatic question for IB in terms of social value creation would lead IB outside familiar territory in terms of the previous focus on financial performance, IB scholars are well equipped to take on this broader question. IB scholars arguably have their key strengths in understanding the inner workings of firms, as well as in understanding the role of context for business. Moreover, to the extent that this new agenda requires IB scholars to acquire new capabilities and form new partnerships with relevant disciplines, this could contribute to revitalising the IB field. As illustrated by the suggested topics, such an agenda could both increase the relevance of IB research and contribute to theory development.
Originality/value
The paper is amongst the first to explore the notion that a broader view of the outcome of MNE activities, beyond MNEs’ own financial outcomes, should be a key goal of future IB research.
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Abstract
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This study examines the differences in corporate transparency between subsidiaries of multinational corporations (MNCs), and domestic corporations (DCs) in India.
Abstract
This study examines the differences in corporate transparency between subsidiaries of multinational corporations (MNCs), and domestic corporations (DCs) in India.
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Cristina Mititelu and Gloria Fiorani
The chapter aims to explore the corporate social responsibility (CSR) policy domain at EU decision-making level, aiming to understand the nature of the participation shaping the…
Abstract
Purpose
The chapter aims to explore the corporate social responsibility (CSR) policy domain at EU decision-making level, aiming to understand the nature of the participation shaping the CSR policy agenda co-design.
Design/methodology/approach
Building on a conceptual framework of participation, the chapter highlights the literature and policy views around the importance of EU CSR policy and how EU envisage the framework of the CSR policy co-design. By highlighting conceptual dimensions of the participatory governance, different levels of participation that shape the policy are evidenced. In particular, a case analysis emphasising the predominant role of the consultation approach in the decision-making process of the CSR policy is undertaken.
Findings
The findings shed light on the shift from the traditional passive participation in EU CSR policy decision making, based on purely communications towards consultation and multi-stakeholders participation. From the multi-stakeholder perspective, the EU Multi-Stakeholder Forum’s strategic relevance is observed, however, with no clear mechanisms to enforce its aims. Although the CSR policy is a core priority on the policy agenda, its voluntary approach justifies its early stages of implementation and fragmented use.
Research limitations/implications
The research is qualitative, based on literature review and policy view. Further research directions could enrich the chapter.
Originality/value
The research contributes to the theoretical discussion around participation in a supranational context. Our insights shed light on the levels of participation and CSR policy goals and call for a critical debate on the EU policy co-design processes. Furthermore, through the lens of a case analysis, it sheds light on how EU CSR forum fits in with the current EU structure and its ‘principle of subsidiarity’, which states that decisions must be taken close to its citizens.
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Li Dong, Jinlong Chen and Weipeng Wu
This study examines how maturity mismatch, a specific type of financial structure of firms, affects corporate outward foreign direct investment (OFDI).
Abstract
Purpose
This study examines how maturity mismatch, a specific type of financial structure of firms, affects corporate outward foreign direct investment (OFDI).
Design/methodology/approach
Using the number of newly established foreign subsidiaries in a given year as firm-level OFDI and utilizing data from Chinese listed firms between 2007 and 2022, we employ a negative binomial regression model to examine the impact of corporate maturity mismatch on the OFDI. We also make efforts to ensure the robustness of the result, such as employing an exogenous policy to establish a difference-in-difference model.
Findings
The empirical result indicates that maturity mismatch inhibits firms' OFDI. Additional test shows that maturity mismatch increases firms' financing costs and reduces firms' research and development (R&D) investment and that the negative impact of maturity mismatch on OFDI is predominantly observed in firms with high financial constraints and low R&D intensity, indicating that maturity mismatch may affect firms' OFDI through the financing cost channel and the R&D investment channel.
Originality/value
Corporate maturity mismatch is common in China and similar emerging markets. However, research on the economic consequences of maturity mismatch, especially its impact on firms' overseas expansions, is rare. This study establishes the relationship between corporate maturity mismatch and OFDI, contributes to the literature on the relationship between financial factors and OFDI, and provides policy implications for emerging market countries.
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