British Journal of Management

Publisher:: Wiley
Publication date:: 2021-02-01

ISBN:: 1045-3172

Issue Number

No. 34-4, October 2023

Latest documents

Understanding the De‐internationalization of Entrepreneurial SMEs in a Volatile Context: A Reconnoitre on the Unique Compositions of Internal and External Factors
In recent years, the global business environment has witnessed a wave of de‐internationalization not only among multinationals but also among small‐ and medium‐sized enterprises (SMEs). This disengagement of cross‐border activities is deemed to be driven by various firm‐specific factors, as well as by external factors. Building on the premise of the non‐linear internationalization debate and focusing on the dynamic capabilities view and institutional theory, this paper aims to disentangle the extent to which internal factors (IFs) and external factors (EFs) drive SMEs towards de‐internationalization. To do this, we take advantage of a hybrid multilayer decision‐making mathematical modelling approach to explore SME de‐internationalization at two levels. Our findings at the exhaustive level contribute to the de‐internationalization literature by proposing distinct frameworks that highlight the interrelationship amongst IFs and EFs. And our results at the subordinate level constitute the identification of four unique compositions leading to different de‐internationalization modes. In this vein, we define two categories of factors, namely reducing and terminating factors, which drive SMEs into respectively partial and full de‐internationalization.
Universities as Internationalization Catalysts: Reversing Roles in University–Industry Collaboration
University–industry (U‐I) collaboration is vital to the development of society. However, this important interaction has become something of a caricature whereby a sequential and unidirectional relationship exists, with universities creating knowledge and industries commercializing it. We address this issue by using the triple helix (TH) perspective and the network‐revised Uppsala model of internationalization to demonstrate how this relationship can be reversed. We present an embedded longitudinal case study of a UK–China innovation programme, run by a UK university with the aim of supporting the development of 62 collaborative innovation projects between 58 UK small and medium enterprises and Chinese organizations. The results reveal a pressing need to revisit universities’ third mission: the transfer of academic knowledge to industry. The findings demonstrate universities’ role as internationalization catalysts for firms engaged in U‐I collaboration. This signals an important and underexplored component of the TH perspective. The knowledge exchange type in U‐I relationships shows a possible reversal in firm and university roles, where knowledge and technology are contributed by firms, and access to markets is orchestrated by universities, which become internationalization platforms.
Climate Risk, Corporate Social Responsibility, and Firm Performance
We examine the impact of climate risk on firm performance with a focus on the moderating role of corporate social responsibility (CSR). Further, we explore how the interaction between climate risk and CSR changes with national culture and religion. Our findings show that firms in countries with greater climate risks are associated with higher levels of CSR activities, possibly suggesting that firms respond to climate risks by engaging in more CSR activities. We then provide robust evidence that higher CSR significantly mitigates the performance‐reducing impact of climate risk. Importantly, the moderating effect of CSR is more pronounced in countries characterized by low individualism and high religiosity. Overall, our findings provide an alternative perspective on the risk‐management benefits of CSR, suggesting that CSR can be considered as a response to climate‐change related risks for corporations.
CEO Marital Status and Insider Trading
We investigate the association between chief executive officers’ (CEOs’) marital status and their tendency to profit from insider trading. We argue that marriage can constrain CEOs’ opportunistic behaviour, which could increase litigation risk, and show that married CEOs earn lower insider trading returns compared to unmarried CEOs. Insider trades can be identified as either routine or opportunistic. We also find that married CEOs are less likely to engage in opportunistic trades, and they earn lower insider trading returns in firms with weaker corporate governance and higher information asymmetry. Our empirical results remain robust after accounting for several endogeneity tests.
Do Board Gender Quotas Generate Horizontal Spillovers?
Using a panel of unlisted Italian banks over the period 2006–2018, we examine the extent to which a law that mandatorily introduced female quotas in the boards of Italian listed companies in 2012 had spillover effects on the boards of unlisted banks, which were not required to comply with the quota. Our results show that both the probability of having at least one woman on the board and the proportion of women on the boards of unlisted banks have been rising significantly after the passing of the law. These findings, which are robust to estimating different specifications and to using different estimation techniques, suggest that the quota law contributed to generating a fairer attitude towards women and, more in general, a change in social norms on gender equality. This may have, in turn, generated isomorphic pressures on unlisted banks, inducing them to mimic the board composition of their listed counterparts.
Contract Types, Institutional Distance and Operational Performance: Evidence from Global Trade Flows in the LNG Industry
In this study, we examine the relationship between contract types, institutional distance and operational performance in the context of cross‐border trade in the liquefied natural gas (LNG) industry. Drawing on the buyer–supplier long‐term relationships literature, we argue for a negative link between short‐term contractual agreements and operational performance. Further, drawing insights from institutional theory, we contend that a high level of formal and informal institutional distance between the origin (i.e. supplier) and destination (i.e. buyer) countries reduces operational performance. We also argue that formal and informal institutional distance mitigates the negative effect of short‐term contracts on operational performance. Finally, we draw on the role of ‘asymmetry in distance’ by examining the direct and moderating effect of both the relevance and direction of formal institutional distance. We test our assumptions using LNG global trade flows from 39 source countries to 44 destination countries over the 2008–2017 period (a total of 17,447 shipments). Our study extends our knowledge on the operational performance implications of buyer–supplier relationships and stresses the important role formal and informal institutional distance plays as a direct and moderating effect on this relationship.
Precautionary versus Signalling Motive of Share Repurchases: Evidence from Policy Uncertainty and the COVID‐19 Crisis
Using policy‐related uncertainty as a shock to firms’ internal and external financing frictions, we find significantly lower repurchase likelihoods, short‐term market reactions, and post‐announcement completion rates of open market share repurchases during periods of high policy uncertainty. Firms are more likely to switch from a high‐ to a low‐commitment repurchase technique when policy uncertainty is high. In contrast, for firms that are significantly undervalued ex ante, higher policy uncertainty leads to more repurchase activities. In addition, we show that the COVID‐19 crisis is associated with a lower repurchase likelihood for financially constrained firms or those with high cash flow volatility, while undervalued firms repurchased more shares during the pandemic period. Our results are robust after controlling for potential sources of endogeneity and conducting a battery of robustness tests. Collectively, our evidence suggests that the relationship between uncertainty and share repurchases is conditional on institutional contexts. Firms’ level of financial flexibility, their demand for signalling, and the credibility and magnitude of repurchase signals all significantly affect their precautionary and signalling motives.
Competitive Categorization and Networks: Cognitive Strategic Groups
Technological advancement compounds the complexity of competitor identification, making it increasingly multi‐front and multi‐dimensional. Strategic groups are an important unit for competition analysis, typically delineated by firms’ characteristic similarities or cognitive maps. Both have inadequacies – the former produces methodological artefacts, and the latter is subject to scale limitations, replicability and managers’ cognitive blind spots. Hence, the need for alternatives supplementing the existing approaches. We propose a novel grouping methodology based on news co‐mentions, reflecting factual corporate events, executives’ and journalists’ views, and environmental changes. It yields three advantages. First, news depicts interorganizational relationships, alleviating the concern that strategic groups are statistical artefacts. Second, the approach supplements managers’ cognition with that of journalists. Third, the public availability of data offers replicability. The proposed methodology is applied to a sample collected from the US high‐tech sector. We document commonalities between the co‐mention‐based groups and the conventionally used characteristic‐based approach. However, the similarity and groups yielded from news co‐mentions go beyond characteristic similarities in explaining competitive inclination, suggesting that the co‐mention‐based approach offers a robust alternative to identifying competitors and strategic groups. Overall, by developing a novel methodology based on a strong theoretical foundation, this study sheds new light on strategic group research.
Walking the Talk? A Corporate Governance Perspective on Corporate Social Responsibility Decoupling
Information asymmetry and the pressure to conform to stakeholders’ expectations cause firms to engage in corporate social responsibility (CSR) decoupling – a practice that has severe socioeconomic consequences for firms. Adopting a corporate governance perspective, this paper answers a novel question: whether board gender diversity (BGD) curbs CSR decoupling. Using a battery of sophisticated analyses and robustness tests on 9276 firm‐year observations for the period 2002–2017, our results confirm that BGD is negatively associated with CSR decoupling. Analysis of the composition of gender‐diverse boards further reveals that this effect is stronger for balanced boards than for skewed and tilted boards. Furthermore, we note that independent female directors are more effective monitors of decoupling than executive female directors. We also document that the relationship between BGD and CSR decoupling is stronger when the overall governance is weak. This implies that gender‐diverse boards could act as a substitute mechanism for corporate governance that would otherwise be weak. Our study offers important theoretical and policy implications for the field of corporate governance and CSR.
Self‐Assessment versus Self‐Improvement Motives: How Does Social Reference Group Selection Influence Organizational Responses to Performance Feedback?
The performance feedback theory (PFT) proposes that organizations compare their performance to other organizations (i.e. their social reference group) and initiate responses based on this comparison. While social comparison represents a core element of the PFT, it is not well understood how organizations select social reference groups and how this selection may affect organizational responses (e.g. risk‐taking, change, innovation). We propose that the motives that organizations use to select their social reference groups impact their responses to performance feedback. Our meta‐analysis of 99 empirical PFT studies focuses on two motives underlying the selection of social reference groups for performance feedback: self‐assessment and self‐improvement. While self‐assessment through comparison requires the selection of a relevant set of referent organizations, self‐improvement relies on the selection of the highest performing referent organizations. Our results show that organizational responses to performance feedback differ depending on which motive‐based reference group is selected for comparison. These differences are more evident when performance is above aspirations. This finding has important implications for PFT researchers to predict organizational responses more precisely.