Non-market Strategies in International Business

The Academy of International Business (UK and Ireland Chapter)

Published in association with the UK and Ireland Chapter of the Academy of International Business.

This book provides theoretical and empirical insights into non-market political and social strategies that firms use when conducting international business. Political strategies include activities such as lobbying, campaign contributions, and using political ties and connections as a means of influencing policy making. Likewise, firms also engage in various social responsibility activities to maintain a good image in society and to improve their legitimacy and reputation when operating globally. Multinational enterprises (MNEs) face various challenges in implementing non-market strategies due to institutional differences between their home and host contexts. Presenting fresh perspectives from a cast of international contributors, this book offers academics, students, and practitioners a greater understanding ofhow non-market strategies can be effective in international business.

Vikrant Shirodkar is Senior Lecturer in International Business at the University of Sussex Business School, UK. His research has appeared in leading journals, such as the British Journal of Management, International Business Review, Management International Review, Journal of International Management, and Journal of Business Ethics. Vikrant is a Fellow of the Higher Education Academy and an Executive Committee Member of the Academy of International Business UK and Ireland (AIB UK&I) chapter.

Steven McGuire is the Dean Professor of Business and Public Policy at the University of Sussex Business School, UK. He taught at Aberystwyth University, the University of Bath, and has been a Visiting Professor at the College of Europe. Professor McGuire is currently researching the impact of the European Union's trade agreements as part of a major Horizon 2020 project, RESPECT.

Roger Strange is a Professor of International Business at the University of Sussex Business School, UK, having previously been a Professor of International Business at King's College London. His research has appeared in leading journals, such as the Journal of International Business Studies, Journal of World Business, International Business Review, Management International Review, and Journal of Management Studies.

Auteur

Vikrant Shirodkar is Senior Lecturer in International Business at the University of Sussex Business School, UK. His research has appeared in leading journals, such as the British Journal of Management, International Business Review, Management International Review, Journal of International Management, and Journal of Business Ethics. Vikrant is a Fellow of the Higher Education Academy and an Executive Committee Member of the Academy of International Business UK and Ireland (AIB UK&I) chapter.

Steven McGuire is the Dean Professor of Business and Public Policy at the University of Sussex Business School, UK. He taught at Aberystwyth University, the University of Bath, and has been a Visiting Professor at the College of Europe. Professor McGuire is currently researching the impact of the European Union's trade agreements as part of a major Horizon 2020 project, RESPECT.

Roger Strange is a Professor of International Business at the University of Sussex Business School, UK, having previously been a Professor of International Business at King's College London. His research has appeared in leading journals, such as the Journal of International Business Studies, Journal of World Business, International Business Review, Management International Review, and Journal of Management Studies.

Contenu

Introduction (by Vikrant Shirodkar, Steven McGuire and Roger Strange)

Part A: Political Risk and Political Strategies in International Business

Chapter 1: Political strategy building within conflicting pressures the case of western multinationals in a post-socialist context

Author: Dorottya Sallai, University of Greenwich, UK

The chapter investigates how multinational subsidiaries develop their political strategies within the conflicting pressures of the host country's institutional context and the MNE's parent strategies within a high risk, emerging market host country context. The chapter links the literatures on institutional duality and corporate political activity (CPA) and makes three distinct theoretical contributions. First, it transfers the analysis of nonmarket strategies from the institutional to the firm level, by opening the black box of how subsidiaries develop host country strategies. Second, by focusing on the process of how subsidiaries turn external and internal resources into political capabilities, it argues that institutional duality should be viewed as an endogenous aspect of the institutional framework, which equips firms with political capabilities, rather than an exogenous factor that constraints companies and disadvantage them in the host environment. Third the chapter contributes to the theory of MNE parent-subsidiary management literature by extending our knowledge on how parent strategies affect the development of subsidiary's political strategies.

Chapter 2: Political strategies of multinational companies in managing uncertainty: Lessons from Brexit

Author: Dzulfian Syafrian, Durham University, UK

This chapter examines the role of corporate power in shaping a company's nonmarket political strategies under situations of uncertainty. Four types of political strategies derived from prior literature on how companies adopt them to cope with uncertainty, namely: passive, collective-defence, supportive, and individual-defence, are discussed. These strategies are argued to depend on two factors: the level of corporate bargaining power and the potential impact of uncertainty on the company. Using the case study of Nissan in the context of Brexit, this chapter argues that corporate political strategy under uncertainty depends on its relative bargaining power which determines how a company exercises the power to manage uncertain environments and its relationship with stakeholders. This includes, in particular, business-government relationship and some benefits from the 'blessing in disguise' situation.

Chapter 3: Organizational political ideology, Host country institutions, and Impact on Employee outcomes

Authors: Dawn Yi Lin Chow (Singapore University of Social Sciences, Singapore), Xiwen Chan (RMIT University, Australia), and Evelyn Micelotta (University of New Mexico)

The chapter draws on an institutional perspective to suggest that (mis) alignment between characteristics of the acquiring organization (i.e., the acquirer's organizational political ideology) and the institutional environment of the host country (i.e. employment regulations, in particular) have an effect on employee outcomes as a consequence of the M&A process. Prior research on cross-border mergers and acquisitions (M&As) tends to adopt an overtly economic, or cultural, approach, to explain the outcomes of cross-border M&As. Research in corporate governance and other cognate fields, however, shows the fruitfulness of a multi-level processual lens to understand the impact of these deals on organizations. This conceptual chapter aims to extend this body of work by drawing on the role theory perspective to theorize how employees may be affected by cross-border M&As and illuminates the consequences of this mismatch at different levels of the organization.

Chapter 4: Balancing to Utopia: Multinationals in Oligarchies

Authors: Camilla Jensen (Roskilde University (RUC), Denmark, and Peter Zamborsky (University of Auckland, New Zealand)

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