7 research outputs found
Corporate Social Performance, Legitimacy, and the Choice of Foreign Partners by StateāControlled Entities in the Global Extractive Industries
Partner selection in IJVs is an important but understudied phenomenon, especially when
viewed from
the perspective of the host country partner involved (Nippa and Reuer, 2019; Sun et al., 2021a). Contrary
to the existing researchās assumption that international strategy decisions reflect the interests of MNEs,
other organizationsā interests may be equally salient (Nippa and Reuer, 2019). Understanding the
perspective of the host partner, the focus of this paper, is critical because, often, it is this local actor that
initiates the search for foreign partners (Shi et al., 2014), or it can domi nate the partnership due to
location specific advantages (Erramilli et al., 1997). Also, the value of nonmarket strategies, including
managing CSP, aimed to give MNEs a foothold in the country (Sun et al., 2021b) hinges on the local
partnersā perceptions.
The host country partner perspective is especially salient when the local state is that partner and when
one considers SCEsā significant involvement in partnerships with MNEs (Sun et al., 2021a). SCEs often
dominate their focal industries, exhibit unique i nstitutional logics, and play a mixed role as regulators,
commercial enterprises, and social contributors. Importantly, they are unique in how their sociopolitical legitimacy is formed. This uniqueness stems mostly from the social contract between the stat
e and the
local society and from the stateās distinct salient sociopolitical stakeholders.
The sociopolitical legitimacy of the state and its actors has significant implications for the success of
the stateās economic exchanges with foreign MNEs. We draw on neo institutional theory (Kostova and
Zaheer, 1999) and argue that in selecting an IJV partner, in addition to using other important task or
partner related selection criteria, an SCE will evaluate partner characteristics that help enhance its
legitima cy, that of the IJV, and ultimately that of the state in the eyes of salient stakeholders. One such
characteristic is, as we posit, a candidate foreign partnerās CSP. We consider the legitimation
mechanisms bolstered by CSP and explain how particular insti tutional factors in the foreign country, the
host country, and supranationally interact with them, influencing CSPās importance as a selection
criterion.
The context of our study is the global extractive industries. They are a crucial wealth
creating instr ument
for resource rich countries, which often rely on foreign partners to exploit resources. Because of the
often disruptive effects of these industriesā activities on communities and the natural environment and
local and international sociopolitical stak eholdersā scrutiny, the foreign partnerās CSP, the legitimacy of
the IJV, and ultimately that of the SCE and the state may determine partnership success. We test our
hypotheses using a sample of IJVs between SCEs from 48 countries and 203 foreign partners from 22
countries between 2000 2015.
Our findings suggest that an MNEās CSP can be an attractive selection criterion for an SCE because of
its legitimacy effects. The SCEās evaluation of CSP as legitimacy enhancing is influenced by the level
of corruption in the MNEās home country, the legiti macy of the host state, and the number of neighboring
countries participating in international multi stakeholder initiatives. Our examination represents the
first, to our knowledge, attempt to study the host stateās perspective in forming partnerships with foreign
MNEs, considering MNEsā CSP as a selection criterion, and showing how nonmarket strategy interacts
with institutional elements at the host, home, and supranational levels
Corporate Social Performance, Legitimacy, and the Choice of Foreign Partners by State-Controlled Entities in the Global Extractive Industries
We study the outcome of the decision of a state-controlled entity (SCE) to form an international joint venture (IJV) with a foreign partner in the SCE's country. Focusing on the perspective of the host SCE, we propose that in its search for a partner, the SCE will evaluate the sociopolitical legitimacy effect of a candidate partner's corporate social performance (CSP). Thereby, the SCE will consider CSP an important selection criterion because of its legitimacy effect on the selection decision, the SCE, the IJV, and the host state in the eyes of salient local and international stakeholders. Moreover, the legitimacy effect of a candidate partner's CSP will further influence the decision outcome through its interaction with the level of corruption in the candidate partner's home country, the extant sociopolitical legitimacy of the host state, and the number of neighbouring countries of the host country participating in international multi-stakeholder initiatives. We find support for our hypotheses using a novel sample of extractive industries IJVs between SCEs from 48 countries and 203 foreign partners from 22 countries for the period 2000ā15
Corporate Social Performance, Legitimacy, and the Choice of Foreign Partners by StateāControlled Entities in the Global Extractive Industries
We study the outcome of the decision of a state-controlled entity (SCE) to form an international joint venture
(IJV) with a foreign partner in the SCEās country. Focusing on the perspective of the host SCE, we propose that
in its search for a partner, the SCE will evaluate the sociopolitical legitimacy effect of a candidate partnerās
corporate social performance (CSP). Thereby, the SCE will consider CSP an important selection criterion because
of its legitimacy effect on the selection decision, the SCE, the IJV, and the host state in the eyes of salient local
and international stakeholders. Moreover, the legitimacy effect of a candidate partnerās CSP will further
influence the decision outcome through its interaction with the level of corruption in the candidate partnerās
home country, the extant sociopolitical legitimacy of the host state, and the number of neighboring countries of
the host country participating in international multi-stakeholder initiatives. We find support for our hypotheses
using a novel sample of extractive industries IJVs between SCEs from 48 countries and 203 foreign partners
from 22 countries for the period 2000-2015
Environmental Management Systems and Environmental Product Innovation: The Role of Stakeholder Engagement
Downsizing and Stakeholder Orientation Among the Fortune 500: Does Family Ownership Matter?
While downsizing has been widely studied, its connection to firm ownership status and the reasons behind it are missing from extant research. We explore the relationship between downsizing and family ownership status among Fortune 500 firms. WeĆ¢\x90Ā£propose that family firms downsize less than non-family firms, irrespective of performance, because their relationship with employees is based on normative commitments rather than financial performance alone. We suggest that their actions are related to employee- and community-friendly policies. We find that family businesses do downsize less irrespective of financial performance considerations. However, their actions are not related to their employee- or community-friendly practices. The results raise issues related to the motivations of large multinationals toĆ¢\x90Ā£downsize and the drivers of their stakeholder management practices. Copyright Springer Science+Business Media, Inc. 2007downsizing, family business, performance, stakeholder orientation,