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This chapter explores how scholarly work in the fields of Finance and International Business (IB) can be mutually supportive. First, it is clear that technology has been a major driver of modern developments in both Finance and IB. Second, Finance can provide many insights into IB scholarship since it has much to say about firm operations and strategy. Third, IB scholarship with its focus on culture also provides significant opportunities for a better understanding of the global aspects of Finance. Finally, it is contended that transaction-costs economics provides an excellent theoretical and fundamental basis for bringing together IB concepts and Finance scholarship. However, while the potential for Finance and IB scholarship to contribute to each other is great, such advances must await the removal of cultural barriers between the two disciplines.

There continues to be much interest in the impact of internal funds on the level of corporate investment activity. While some studies provide evidence that investment decisions of firms that are financially constrained are more sensitive to the availability of internal funds than those of less constrained firms, other studies show the opposite, i.e. investment decisions of the most credit-worthy firms are most sensitive to internal funds availability. This paper tests these opposing propositions for U.S. firms using data for a longer and more recent period than in prior studies. The results support the latter view, i.e. investments at financially constrained firms are less sensitive to internal cash flows than in financially less constrained firms. Regardless, investments levels are found to be positively related to internal cash flows for all types of firms and for all periods examined indicating a pecking order in financing (firms prefer first using internal funds and only then go to external funds).

This chapter complements the one that appeared as “History of the AIB Fellows: 1975–2008” in Volume 14 of this series (International Business Scholarship: AIB Fellows on the First 50 Years and Beyond, Jean J. Boddewyn, Editor). It traces what happened under the deanship of Alan Rugman (2011–2014) who took many initiatives reported here while his death in July 2014 generated trenchant, funny, and loving comments from more than half of the AIB Fellows. The lives and contributions of many other major international business scholars who passed away from 2008 to 2014 are also evoked here: Endel Kolde, Lee Nehrt, Howard Perlmutter, Stefan Robock, John Ryans, Vern Terpstra, and Daniel Van Den Bulcke.

Effective mechanisms for corporate governance are essential for market-based economic systems. This chapter addresses the necessity of corporate governance research to address the competing goals of various stakeholders in the firm: managers, suppliers of financial capital, and other stakeholders. The review of literature reveals that firm-level complexity, as well as diversity of national business systems, are important for understanding corporate governance practices and regulations around the world.

Most years, several AIB members are elected as AIB Fellows on account of their excellent international business scholarship, and/or past service as AIB President or Executive Secretary. The Fellows are in charge of electing Eminent Scholars as well as the International Executive and International Educator (formerly, Dean) of the Year, who often provide the focus for Plenary Sessions at AIB Conferences. Their history since 1975 covers over half of the span of the AIB and reflects many issues that dominated that period in terms of research themes, progresses and problems, the internationalization of business education and the role of international business in society and around the globe. Like other organizations, the Fellows Group had their ups and downs, successes and failures – and some fun too!

Using recent panel data on U.S. and Japanese firms and time-series, cross-sectional analysis, this study documents that in both countries controlling for the investment opportunity set, investments are significantly positively influenced by internal cash flows. This relationship strengthens with the degree of constraints faced in Japan but not in the U.S. Our findings indicate that firms in both countries operate in financially imperfect markets using a pecking order in financing. As expected for Japanese companies, investment by Keiretsu member companies was significantly less influenced by cash flow and more influenced by the investment opportunity set compared to investment by non-member companies.