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The purpose of this paper is to develop a conceptual model for the mode of entry in a particular case of global MNEs entering into emerging markets.

The conceptual model builds on institutional theory and follows an integrated approach of entry mode theories using bargaining theory, the liability of foreignness and local legitimacy.

The conceptual model introduces five propositions.

The study has policy implications for emerging market institutions. Also, the model highlights the significance of long-term vision in global MNEs’ sustainability. However, the model excludes the MNEs’ internal institutions, home country institutions, as well as institutional and cognitive distances.

The conceptual model addresses the dynamics of MNEs’ entry decisions with long-term strategic vision. It helps to recognize the global MNEs’ internalization of the host country’s formal and informal institutions when the bargaining power is in imbalance.

This study aims to understand how the coevolution of multinational enterprises (MNEs) and emerging economy institutions affects social and economic (in)equality in an ambiguous, emerging economy context from a political actor perspective.

Qualitative in nature, the study builds on conversations with 20 political actors involved in the peacebuilding process in Myanmar/Burma. It analyzes their perceptions of interaction of MNEs and host economy institutions from a social constructionist viewpoint.

The study identifies four coevolution patterns which portray the evolving interaction between MNE activities and different elements of their host institutional environment as well as their consequences for social and economic (in)equality.

This study contributes to critical international business research on emerging economies by emphasizing the different and partly conflicting host institutions of various stakeholder groups involved in the coevolution of MNEs and host institutional environments. The more nuanced conceptualization of the complex institutional environment enables the analysis of inequality as a direct and indirect outcome of MNE–institution interaction. Thus, the study connects to the business and human rights discussion and provides insight into the consequences of MNEs’ adoption of social and environment standards.

The purpose of this paper is to explore the interaction between multinational enterprises (MNEs) and public governance institutions in regions of limited statehood by focusing on three areas of inquiry: first, the impact of MNEs in these environments; second, the mechanisms and levels through which MNEs engage with external governance processes; and finally, the strategic motivation for the mode and level of engagement.

The authors follow an applied qualitative research approach, drawing on the principles of case study design, through interviews with executives that were involved in setting up four MNEs in Afghanistan.

The results reveal a relationship between the depth of country embeddedness and the level of engagement of MNEs with public institutions and this is related to issues around risk mitigation and time horizons. Deeper embeddedness in the local markets brings greater exposure to risk leading to more and wider engagement in governance processes and cross-sector partnerships in order to influence these concerns.

The research contributes to institutional theory and demonstrates the interplay between organizations and the institutional surroundings. MNEs in Afghanistan are deeply affected by institutional weakness which contribute toward greater uncertainty and impact their behavior, but MNEs also have a direct bearing on institutions.

In fragile and conflict-affected states, MNEs can contribute toward peace and institution building and reinforce cycles of positive development, or they can further pathological behavior and contribute to conflict.

MNEs are increasingly going to be expected to step into the gaps associated with institutional voids and this will require a different approach to doing business and their choice of approach will have a direct bearing on social outcomes in host countries.

The authors reveal two models of MNE engagement in these areas of limited statehood, namely an embedded vs autonomous model and examine their implications.

This paper aims to investigate whether multinational enterprises (MNEs) are more or less likely than local firms to violate their employees’ human rights in emerging economies, whether regional institutional pressures influence the likelihood of violating employee human rights and whether the density of MNEs in a region affects the likelihood of employees’ human rights violation by local firms.

Building on neo-institutional theory, this paper hypothesizes that, in an emerging economy, MNEs violate their employees’ human rights significantly less than local firms do. Moreover, it is hypothesized that the quality of regional institutions only influences the social behavior of local firms toward their employees. In addition, it is hypothesized that the density of MNEs in a region has a positive effect on local firms’ attitudes toward employee human rights. These hypotheses are examined using a sample of 1,211,638 respondent–year observations in 32 Mexican regions between 2005 and 2014.

This paper shows that MNEs are less likely to violate their employees’ human rights than local firms are. It also provides evidence that regional institutions do not influence MNE behavior toward employee human rights violation, but affect local firms. Furthermore, contrary to what was hypothesized, the density of MNEs in a region has a negative rather than positive influence on local firms’ respect of employee human rights.

This paper advances understanding of the behavior of MNEs in an emerging economy setting and contributes to the ongoing debate in the literature on their social impact.

The purpose of the study is to develop an understanding of the interplay between multinational enterprises (MNEs) and informal institutions on a firm–industry level. “Interplay” here means how responses to institutions develop in a particular context and how this development is interrelated with stakeholders’ reactions and activities. To study this interplay between MNEs and informal institutions, the authors draw on literature on institutional complexity, as well as on a co-evolutionary perspective. Two case vignettes are presented on MNEs’ post-entry strategies and behaviors in their new host markets, with a view to understanding how and under what conditions informal institutions in the host market may compel MNEs to alter their initial strategies and behaviors in the market and, on the other hand, how and under what conditions MNEs’ strategies and behaviors may act as catalysts of change in these informal institutions.

Wars, and violent conflicts generally, can generate significant institutional dynamics and new legitimacy pressures for multinational enterprises (MNEs). The purpose of this paper is to understand the nature or source of institutional pressures facing MNEs in war and to examine how MNEs respond and navigate these institutional pressures.

This is a conceptual paper.

Through the theoretical lens of institutional theory and drawing on insights from the devastating Russian–Ukrainian war in Europe, the study provides a framework that explains the nature of institutional pressures impacting MNEs in a major war conflict and how MNEs respond to these pressures. Central to the framework is the impact of formal and informal institutions on MNEs during war. As a result of regulatory and social pressures, MNEs have to make important strategic decisions either to protect their legitimacy or to defend their economic objectives against institutional demands.

As the paper situates the pressures of war for MNEs in a formal and informal institutional context, this offers a new approach to understanding the costs and pressures of war on MNEs.

This paper aims to study whether the adoption of an entry mode that fits the social trust level contributes to the improvement of foreign subsidiary performance.

The authors used the Probit model, linear regression, strategic fit approach and instrumental variable regression. The sample was made up of 11,095 observations of Chinese multinational enterprises' foreign subsidiaries in 54 countries from 2005 to 2020.

The results suggest that a host country with a high level of social trust results in fewer difficulties for enterprises in gaining legitimacy, thus foreign subsidiaries are more likely to select the wholly owned entry mode. The results also show that the effect is contingent on the formal institutions of host countries. The results of the mechanism test suggest that social trust influences subsidiaries' entry mode choice by reducing information asymmetry, costs and uncertainty risks. This study further finds that selecting a fit entry mode based on social trust level substantially increases foreign subsidiary performance and this effect is more significant when multinational enterprises (MNEs) are state-owned enterprises (SOEs).

The main limitation of this paper is its only focus on foreign subsidiaries of Chinese MNEs, which may limit the generalizability of research findings.

This paper responds to the call for conducting more research on informal institutions. Findings highlight the critical role of informal institutions in helping foreign subsidiaries in gaining legitimacy in host countries and the essentialness of selecting a fit entry mode based on the informal institutions of host countries for the development of foreign subsidiaries.

The purpose of this chapter is to examine the relationship between multi-national firms (MNEs), institutions and innovation.

We empirically examine the link between corruption and innovation within the environment of Russia. The use of data on foreign direct investment (FDI) from both emerging and developed markets provides us an opportunity to test whether the impact on innovation of different types of MNEs varies.

We find that, in the environments with high political risk, corruption may act as a hedge against such risks, boosting the scope and scale of innovation. We, however, find no support for the assumption that the experience at home of emerging country MNEs would offer them the advantage over the developed country MNEs in environments with weak institutions.

One of the major implications of this study is that, in as geographically large country as Russia, it is critical to consider the factors affecting innovation output at sub-national level.

The study is novel as it is the first to examine how innovation is affected by institutions in general and corruption in particular. But in our approach, we use the measure of the actual rather than perceived corruption. Previous studies have largely focused on developed country MNEs; in this study, we examine the impact on innovation of investors from developed as well as emerging economies.

Multinational enterprises (MNEs) attempting to create social value in base of the pyramid (BoP) economies are encumbered by unique market and institutional barriers. To overcome these challenges, BoP scholars have advocated the strategy of using embeddedness as a replacement for inefficient formal institutions. Reliance on informal social ties for coordinating market exchange, however, leads to costly investments, exposure to opportunism and the creation of nontransferable capabilities. This paper aims to investigate these issues.

The authors argue that embeddedness should be used as an intermediate step toward developing more enduring formal institutions rather than as a replacement for them.

The authors put forward the notion of proto-institutions as a useful concept for exploring how MNEs can engage in co-designing efficient and inclusive institutional forms aimed at engendering long-term social value creation.

The authors identify three institutional fields wherein MNEs can leverage social embeddedness to develop proto-institutions that are potentially transferable to become formal institutions. First, MNEs can build governance institutions that can enhance coordination among local actors. Second, MNEs can experiment with small-scale change and adaptation of market institutions that reduce transaction costs and facilitate market exchanges. For example, improved institutional practices in value chain governance can boost business performance while also improving the livelihoods of supply chain partners. Finally, the authors discuss the potential for developing favorable socio-cultural institutions by introducing new principles of organizing or educational practices.

The purpose of this paper is to examine the strategic responses of multinational enterprise (MNE) subsidiaries in China toward a unique institutional characteristic – the structural discrimination against rural migrant workers.

Based on surveys of 181 firms and 669 rural migrant workers, as well as a case study of eight firms in Jiangsu and Shanghai, the authors examined and compared the human resource management (HRM) policies of MNE subsidiaries and domestic Chinese firms toward rural Chinese migrant workers.

This study found that MNE subsidiaries are more likely to accept local discriminatory HRM practices when managing migrant workers. In response to the institutional environments of host countries, MNE subsidiaries tend to share similar behavioral characteristics with local firms and are reluctant to show leadership in initiating institutional change in host countries.

This study is important since it enables investigation of some prevailing assumptions in the literature. Contrary to common wisdom that MNEs are change agents that proactively engage in institutional entrepreneurship in host countries, this study found that MNEs’ responses to the institutional environment of host countries are shaped by their entry modes and the institutional environment in their home countries. MNEs are as diverse as their home countries and far from forming a unified organizational field with similar behavioral characteristics.