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Relationships are a critical success factor for business operations across markets with dominant Chinese culture, like Taiwan. The intersection of a high-quality institutional environment and a traditional Chinese cultural background in Taiwan provides a unique setting for exploring different types of relational mechanisms and ensuing renqing practices (i.e. reciprocal exchange of favors with empathy). The purpose of this paper is to examine when, where and how Taiwanese high-performance organizations manage and deploy interorganizational renqing across their business relationship portfolios. Answering these questions can help build a theory of interorganizational renqing and advance interorganizational reciprocity theorization more generally.

This research is motivated by two key research questions. First is related to how renqing givers understand renqing in the context of their organizations and their interorganizational business relationship portfolios. Second, whether organizations prefer a neutral renqing balance, a renqing debt or a renqing surplus is another point of interest. The study is based on interviews with upper echelon elite informants at six high-performing Taiwanese organizations with business relationship portfolios worldwide.

It is found that interorganizational renqing is deployed as a hybrid resource, taking on the functions of both an investment and a type of insurance against risk. Two notable differences between interorganizational and interpersonal renqing are also noted. First, the social exchange norm aspect of renqing points to salient social exchange norms also in interorganizational exchanges. This confirms the importance of understanding not only the regulative and normative dimensions of business relationships, as a type of institution, but also the cognitive dimensions and underlying institutional logics. Second, this study shows that unlike at the interpersonal level, the notion of renqing debt is not common at the interorganizational level – at least not within high-performance organizations with market leader positions.

This study explores interorganizational renqing practices and their strategic deployment through the use of “accessing” and “embedding” relational mechanisms. The study also adds to the poorly understood nature of interorganizational reciprocity and provides support for developing a theory of interorganizational renqing, as a form of interorganizational reciprocity within a Chinese cultural context.