Sustainable International Business practices by MNEs in Emerging Markets

Guest Editors:

Geoffrey Wood, The University of Essex (UK)

Vijay Pereira, Khalifa University, Abu Dhabi (UAE)

Yama Temouri, The University of Wollongong in Dubai (UAE)

and Aston University (UK)

Adrian Wilkinson, Griffith University (Australia)

There has been an increasing emphasis on sustainability, given growing concerns around an over-emphasis on shareholder value, environmental concerns, and increasing macro-economic volatility (Wilkinson et al., 2001; Durand and Jacqueminet, 2015). Multinational enterprises (MNEs) cross national boundaries, and hence, are likely to face a range of different sustainability issues, according to their country of domicile. The international business (IB) literature has made significant contributions to uncovering what might constitute sustainable activities by MNEs. Further, MNEs may contribute to national development through the dissemination of superior technology and knowledge resources and assets, management practices as well as sustainable practices and corporate social responsibility (CSR). For example, the IB literature has shown evidence of how MNEs can bridge institutional weaknesses and voids (Khanna and Palepu, 2004) by providing infrastructure, education or healthcare services, and/or better environmental and labor practices, that allows the MNE to make profits, be law-abiding, ethical, but also, directly and indirectly, providing wider benefits to others in the host region (see review by Kolk, 2016). However, they may also evangelize short-termism, and engage in environmentally, politically, socially, and/or economically destructive practices.

Another strand of the IB literature has shed light on the ways in which CSR can be part of an MNE’s overall strategy in reducing its inherent ‘liability of foreignness’ challenge. Apart from increased attention on institutions, there have been several links between CSR, sustainable development, and other IB debates such as absorptive capacity, resource dependency, reverse knowledge transfer, global value chains, and production networks. Crucially, it is the combined responsibility and efforts of all stakeholders, such host governments, civil society, NGOs, supranational organizations, and the capabilities of MNEs that will allow for a longer-lasting positive impact in the societies in which MNEs operate.

In this context, sustainable development and innovative solutions have often been framed in terms of developed countries setting an example for developing countries. However, the recent environmental record of the mature liberal markets has been poor, whilst the developing world led by the BRICS countries have made progress. Since South Africa joined in 2010, the BRICS have made significant progress in a number of areas, including the joint establishment of the New Development Bank, endowed with $100 billion for sustainable development projects in the region. Whilst China has recently strongly promoted renewable energy, the official policy of the mature liberal markets of the US, UK, and Australia has recently returned to the promotion of hydrocarbons. Whilst not mechanically articulated, such policy variations have implications for national and domiciled MNEs.

There has been also an increasing focus on how MNEs operate their global value chains and the ethical implications as to what goes on at their furthest reaches. There are many examples of gross misconduct, from the Rana Plaza scandal to the flood of cheap tropical hardwood products in the West. Hart and Christensen (2002) highlight how MNEs make usage of brokers, which distances, yet, does not absolve them from what goes on at the base of production. Yet, other strands of the IB literature, highlight how sustainable supply chain management in the food industry can help MNEs to achieve their sustainability goals when poor communities are involved in the production process (Gold, Hahn & Seurig, 2013). Similarly, Ansari, Munir & Gregg (2012) show how MNEs can use the bottom of the pyramid (BoP) approach to reduce poverty by transferring social capital to those communities. Sinkovics, Sinkovics, and Yamin (2014) take a slightly different approach and describe how MNEs may learn to create social value creation by observing BoP business models in the rural Indian context. Locke and Romis (2007) show how MNEs are able to assist their suppliers from developing countries to become more responsible for improving their working conditions.

While MNE activity is seen as important for sustainable development, the empirical literature is still limited and sometimes offers conflicting findings (see review by Kolk, 2016). Understanding how MNEs handle and overcome the unique political, religious, cultural, and commercial environments present in emerging markets becomes critical for the global success of MNEs. Combined with the efforts of EMNEs to increasingly engage in outward investments offers a rich contextual testbed for theorizing and analyzing the strategic role that emerging markets can play in the global business community with regards to sustainability.

Accordingly, further research is needed to advance the integration of how sustainable business practices are achieved by MNEs from and/or domiciled in emerging markets and how these not only impact host countries but also shape the “mind-set” of the MNE. How does the challenging context of emerging countries drive MNEs to be unique in their efforts to achieve their CSR and sustainability goals? Do these new practices have the ability to become global best practices? Can current emerging market experiences lead MNEs to learn and become more agile and adaptive to future foreign markets that present different contexts and challenges?

These questions provide compelling areas in which existing IB theories can and should be complemented with other social science theories in order to better test and decipher complex interactions between various stakeholders at multiple levels. Following the arguments put forward by Buckley et al. (2017), “grand challenges” such as the United Nation’s Sustainable Development Goals may have significant implications for IB theory and in turn could offer new insights for how MNEs structure themselves at different levels which can only be explained by theories from different social science backgrounds (Pereira, 2017). Recent developments and extensions of the institutional theory have highlighted the relationship between variations in national sustainability, institutions, and the wider political economy (Demirbag et al., 2017), and, indeed, unfolding political events.

Therefore, the focus of this Special Issue is to offer new insights into the role that MNEs can play in sustainable international business practices in emerging markets. We welcome conceptual and empirical papers using a diverse range of methods that address areas such as the indicative themes outlined below:

• What are the unique challenges and opportunities for sustainable business practices by MNEs when entering emerging markets?

• How do MNEs formulate optimal sustainable strategies when investing in emerging markets?

• Contextual effects on sustainability: country of origin and domicile pressures in emerging markets.

• What are the sustainable international business practices of MNEs in emerging markets?

• How do MNEs cope with the challenges when entering and operating sustainably in emerging markets in terms of its unique political, religious, cultural, and commercial environments?

• How does the adoption of global best practices, in terms of sustainability, impact on the internalization activities of MNEs?

• What are the effects of sustainable business practices by MNEs on host countries?

• Developed vs Emerging MNEs (DMNEs vs EMNEs): Identifying and exploring the varieties of sustainability.

Submission Information:

• All papers will be subject to double-blind peer review.

• Authors should follow the IBR guidelines: https://www.journals.elsevier.com/international-business-review/.

• All submissions should be submitted electronically to https://www.journals.elsevier.com/international-business-review/choosing SI: Sustainable International Business practices by MNEs in Emerging Markets as the article type.

• Submission deadline: 30th November 2019.

• Questions about the Special Issue can be directed to the guest editors: Vijay Pereira (vijay.pereira@port.ac.uk), Geoffrey Wood (gtwood@essex.ac.uk)Yama Temouri (Y.TEMOURI1@aston.ac.uk) and Adrian Wilkinson (adrian.wilkinson@griffith.edu.au)

References

Ansari, S., Munir, K., & Gregg, T. (2012). Impact at the ‘bottom of the pyramid’: The role of social capital in capability development and community empowerment, Journal of Management Studies, 49(4): 813–842.

Buckley, P. J, Doh, J. P., & Benischke, M. H. (2017). Towards a renaissance in international business research? Big questions, grand challenges, and the future of IB scholarship, Journal of International Business Studies, 48: 1045–1064.

Demirbag, M., Wood, G., Makhmadshoev, D. and Rymkevich, O. 2017 “Varieties of CSR: Institutions and Socially Responsible Behaviour”, International Business Review, 26 (6): 1064-1074.

Durand, R., and Jacqueminet, A., 2015. Peer conformity, attention, and heterogeneous implementation of practices in MNEs. Journal of International Business Studies, 46(8), pp.917-937.

Gold, S., Hahn, R., & Seurig, S. (2013). Sustainable supply chain management in “Base of the Pyramid” food projects—A path to triple bottom line approaches for multinationals? International Business Review, 22(5): 784-799.

Hart, S. L., & Christensen, C. M. (2002). The great leap: Driving innovation from the base of the pyramid. MIT Sloan management review, 44(1), 51.

Khanna, T., & Palepu, K. G. (2004). Globalization and convergence in corporate governance: evidence from Infosys and the Indian software industry, Journal of International Business Studies, 35(6): 484-507.

Kolk, A. (2016). The social responsibility of international business: From ethics and the environment to CSR and sustainable development, Journal of World Business, 51, 23-34.

Locke, R., & Romis, M. (2007). Improving work conditions in a global supply chain. MIT Sloan Management Review, 48: 54–62.

Pereira, V. (2017). Journal Editors as Philosopher Kings: the duties and responsibilities of academics in a changing world. Journal of South Asian History and Culture. 8(3), 360-364.

Sinkovics, N., Sinkovics, R., & Yamin, M. (2014). The role of social value creation in the business model formulation at the bottom of the pyramid – Implications for MNEs? International Business Review, 23(4): 692-707.

Wilkinson A, Hill M, and P.Gollan (2001) International Journal of Operations and Productions Management, 21(2): 1492-1502.

Geoffrey Wood is Professor of International Business and Dean of Essex Business School, UK. Previously he was Professor of International Business at Warwick Business School, University of Warwick and Associate Dean of WBS, Professor in HRM, in the School of Management at the University of Sheffield, and Associate Dean of the School, and before that, he was Professor and Director of Research at Middlesex University Business School, and taught at Rhodes University, South Africa (where he attained the rank of Associate Professor) and Coventry University, Coventry, UK (where he attained the rank of Reader). He has also held visiting fellowships at Cranfield University, Victoria University of Wellington (New Zealand), and Cornell University. He has authored/co-authored/edited twelve books and published over hundred and twenty articles in peer-reviewed journals such as Organization Studies, Human Relations, British Journal of Management, Human Resource Management (US), Human Resource Management Journal (UK), Journal of World Business, British Journal of Industrial Relations, Corporate Governance: An International Review, International Journal of Management Reviews, International Journal of Human Resource Management, and others. He has extensive editorial experience. Prof. Wood is an Editor-in-Chief of the British Journal of Management and Associate Editor of Academy of Management Perspectives. He has served as a guest editor for numerous special issues, including Journal of World Business, International Business Review, Journal of Business Research, Human Resource Management (US), Human Relations, Human Resource Management Journal (UK), International Journal of Human Resource Management, Economy and Society, Industrial Relations - A Journal of Economy and Society, and others.

Vijay Pereira, (Ph.D.), is an Associate Professor of Strategic and International HRM at Khalifa University, UAE. He is the Associate Editor (Strategic Management and Organization Behavior), Journal of Business Research. Dr. Pereira is a visiting scholar at Manchester and Portsmouth Universities, UK. He has experience and expertise in consulting, industry, and academia, globally. Dr. Pereira has a track record of attracting funding and has published widely, in over 100 outlets, including in leading international journals such as the HRM US, Journal of World Business, International Journal of HRM, Journal of Business Research, HRM Review, Journal of International Management, and International Journal of Production Research, among others. He is currently on the editorial and advisory board for the journals Production and Operations Management (Listed in Financial Times), International Journal of HRM, Asia Pacific Journal of Management, Asian Business & Management Journal, and South Asian History and Culture.

Yama Temouri is an Associate Professor of International Business at the University of Wollongong in Dubai, UAE. Prior to joining UOWD in 2016, Dr. Temouri was an Associate Professor at Aston Business School in the United Kingdom. He is an Associate Editor for the Business Research Quarterly(Elsevier Publishers) and his research interests are mainly in the economics of multinational enterprises and their impact on host and home economies. He is currently working on the link between institutional quality, foreign direct investment, and firm performance as well as analyzing the locational choices of foreign direct investment in tax havens. Dr. Temouri has published in top tier journals such as Journal of World Business, Journal of International Management; Journal of Business Research, and Corporate Governance: An International Review. He also has extensive consultancy experience, including projects for the OECD, European Commission, and several UK Government Departments, including the United Kingdom Trade and Investment (UKTI) Department; the Department for Business, Innovation, and Services (BIS) and the Innovation foundation NESTA.

Adrian Wilkinson is Professor and Director of the Centre for Work, Organisation and Wellbeing at Griffith University, Australia. He holds Visiting Professorships at Loughborough University and Sheffield University and is an Academic Fellow at the Centre for International Human Resource Management at the Judge Institute, University of Cambridge. Adrian has authored/co-authored/edited thirty books and over one hundred and fifty articles in academic journals. He is currently the editor for Human Resource Management Journal and was previously the editor for the International Journal of Management Reviews. He has edited special issues for many journals including Human Relations, Human Resource Management, International Journal of Human Resource Management, and Group and Organization Management.