This study examines the role of multinational enterprise (MNE) subsidiaries in facilitating environmental upgrading in value chains, with a specific focus on the salmon aquaculture sector. Addressing the critical challenge of Scope 3 emissions, this research investigates the dynamics between a French food MNE’s UK subsidiary (Company X) in UK, acting as a Tier 1 supplier, and its lower-tier suppliers in Scotland and Norway. We explore how do multinational enterprise subsidiaries act as bridging mechanisms to mediate sustainability mandates and local institutional contexts, driving environmental upgrading and addressing Scope 3 emissions in the context of salmon value chains. Through qualitative analysis of interviews and secondary data, the findings highlight the subsidiary’s bridging role in reconciling global corporate mandates with local institutional pressures. Institutional context plays a defining role in shaping subsidiary’s bridging strategy with divergent implications for Scottish and Norwegian suppliers environmental upgrading.
Empirical research suggests that the fast fashion (FF) industry is a major contributor to global climate change. Fast-fashion supply chains (FFSCs) are inherently complex due to the multiplicity of processes, locations, and stakeholders involved. This research explores the key climate change risks, response strategies, and application of emerging technologies in the comparative context of developing and developed countries. Institutional theory was used as a theoretical lens, and the research data were collected by using expert interviews from industry experts in Pakistan and the UK. The analysis shows numerous climate change risks posed by FFSC at multiple tiers, ranging from raw materials to the retailing of products. The FF industry in Pakistan is more focused on meeting the needs of UK fashion brands by adopting global frameworks to reduce their greenhouse gas emissions, including using sustainable materials and adopting changes according to the environmental standards and renewable energy due to coercive, normative, and mimetic pressures. In contrast, coercive and mimetic pressures forcing UK fashion companies to address regulatory and economic challenges and deal with persistent organisational and cultural issues including fast-changing customer requirements. To mitigate climate change risks, companies in both contexts are adopting emerging technologies such as AI-based analytics, internet of things, automation, blockchain and digital traceability-based solutions, and 3D printing. However, they face challenges such as high initial costs, human capital gaps, and data integration issues. To mitigate these challenges, companies in both contexts are adopting strategies such as technology–business alignment, collaboration with technology partners and multiple stakeholders, pilot testing of new technologies, cultural transformation, and structural changes.
Earlier research has suggested that perception gaps may exist in MNEs, but a particular type of perception gap has not been identified nor have its consequences been investigated. To fill this void, we first postulate that the perception gap between headquarters (HQ) and subsidiaries may emerge due to distributive fairness. Second, we contend that such a perception gap will have an inverse U-shaped association with subsidiary initiative. Last, we suggest that the degree to which a subsidiary is embedded in the host country will moderate the proposed curvilinear effect of the perception gap. Results based on a sample of MNEs based in Taiwan support our arguments. Our findings suggest that perception gaps regarding rewards allocation may undermine MNEs’ competitive advantage by diminishing subsidiary initiative, and that the effect can be greater for subsidiaries highly embedded in their host countries.
While political connections are commonly linked to positive effects on firm performance, much less is known about the contingencies that shape these benefits. This study examines the simultaneous differential effects of political connections on domestic and international performance, and how political instability and regulatory deficiencies moderate these effects. Drawing on resource dependence and institutional theories, we argue that while political connections will be beneficial for performance in domestic markets, they will hinder firms’ international performance. Moreover, we postulate that these direct effects will be weakened by political instability and strengthened by regulatory deficiencies, respectively. We test these hypotheses using data from the World Bank’s Enterprise Surveys on more than 1300 firms from Egypt, a context marked by a high prevalence of political connections, persistent political instability, and severe regulatory deficiencies. Our empirical results yield important insights for managers in emerging economies who seek to balance the benefits of political connections with their strategic risks.
This study examines how family ownership affects a firm’s climate performance and how this effect is shaped by multinational enterprises’ (MNEs’) exposure to international institutional environments. Drawing on agency theory and the socioemotional wealth (SEW) perspective, we analyze Korean family-owned MNEs, which operate in a domestic context of institutional voids but interact with diverse global regulatory regimes. Using firm-level data on greenhouse gas emissions and foreign exchange-based measures of regional dependency, we find that concentrated family ownership is associated with weaker climate engagement. However, this relationship is context-dependent: internationalization mitigates the adverse effect of family ownership, especially when firms are exposed to environmentally stringent host countries. In contrast, exposure to institutionally lax environments reinforces or fails to offset this negative influence. No significant effects are found for intermediate levels of regulation. These findings show that family firms’ climate behavior is shaped not only by ownership structure but also by transnational institutional pressures. International exposure thus emerges as a potential substitute for weak home-country governance in emerging markets.
