Dear friends and colleagues,
We are delighted to share the fourth issue of Global Strategy Journal for 2025. It is available at
https://sms.onlinelibrary.wiley.com/toc/20425805/current.
This issue contains papers accepted through the regular process and grouped around the topic of Foreign ownership and global challenges.
Pooja Thakur-Wernz and Olga Bruyaka examine how foreign ownership influences corporate social responsibility (CSR) overspending in emerging markets, challenging the assumption that foreign firms are more generous CSR spenders. Dennis Wajda, Fengdian Yang, Wei Shi and Ruth V. Aguilera study the impact of foreign takeover protection on firms' CSR following the enactment of investment screening laws worldwide, suggesting that such protection encourages protected firms to improve CSR by expanding managerial investment horizons and increasing the motivation for long-term investments. You-Xiang Song elucidates why foreign IPOs suffer from the liability of foreignness in capital markets and how they overcome this liability. The article by Jung-Hyun Suh and Shige Makino closes the issue. It uses unpublished survey data on Japanese MNCs to examine how a subsidiary's host-country experience affects how MNCs' subsidiary termination decisions are geared toward subsidiary-level social performance comparisons.
The papers are open access, and you can get them by clicking on their titles.
If you are interested in reading forthcoming papers accepted but not yet published in an issue, you can find them at onlinelibrary.wiley.com/toc/20425805/0/0.
We look forward to receiving your best work for consideration for publication.
Best wishes,
Gabriel R. G. Benito, Stewart Miller and Grazia Santangelo
Co-editors of Global Strategy Journal
Not so generous after all? Foreign ownership and CSR overspending in emerging markets
Pooja Thakur-Wernz and Olga Bruyaka
Is foreignness a liability or an asset when firms decide on CSR spending? We examine how foreign ownership influences CSR overspending, defined as spending that exceeds legally mandated thresholds, in emerging markets. Using data from 320 publicly listed firms in India (2015–2023), we find that higher foreign ownership is associated with lower CSR overspending, challenging the assumption that foreign firms are more generous CSR spenders. This relationship is moderated by the ESG reputation of the foreign owner; owners recognized for "doing good" tend to reduce overspending, while those linked to controversies increase it. Our contingency-based perspective suggests that whether foreignness acts as a liability or an asset depends on firm-specific characteristics, complementing research that emphasizes institutional-level explanations for foreign firm behavior in emerging markets.
Foreign takeover protection and corporate social responsibility
Dennis Wajda, Fengdian Yang, Wei Shi and Ruth V. Aguilera
This study examines the impact of foreign takeover protection on firms' corporate social responsibility (CSR) following the enactment of investment screening laws worldwide. Drawing on research on intertemporal trade-offs in managerial investment decisions, we argue that foreign takeover protection encourages protected firms to improve CSR by expanding managerial investment horizons and increasing the motivation for long-term investments. This effect is stronger in countries with long-term-oriented national cultures and among firms with higher levels of long-term institutional ownership. Using a sample of 5353 firms across 72 countries from 2001 to 2018, we find support for our arguments. Our study provides a behavioral account of foreign takeover protection's impact and highlights its positive implications for firm CSR.
Legitimacy in flux: A moderated mediation model of the liability of foreignness in global IPO markets
You-Xiang Song
Foreign initial public offerings (IPOs) play a significant role in global stock markets. This paper aims to elucidate why foreign IPOs suffer from the liability of foreignness in capital markets (CMLOF) and how they overcome this liability. Building on international business research and the legitimacy perspective, I develop a moderated mediation model demonstrating that (1) media sentiment variability mediates the effect of IPO firms' foreignness on the delisting hazard, and (2) the firm's geographic diversification moderates this mediated effect. This paper advances IPO research by addressing the crucial yet understudied area of foreign IPO firm survival and empirically examining the sources and remedies of the CMLOF in the context of foreign IPOs.
Subsidiary-level performance comparisons with external versus internal peers and subsidiary termination decisions: The role of host country experience
Jung-Hyun Suh and Shige Makino
We examine how a subsidiary's host country experience affects the way in which multinational corporations' (MNCs) subsidiary termination decisions are geared toward subsidiary-level social performance comparisons. For a subsidiary, social comparisons can be made against external peer subsidiaries (in the same industry and country but under different parents) and internal peer subsidiaries (in the same industry, country, and parent) whose performance levels constitute external social aspirations (ESA) and internal social aspirations (ISA), respectively. Using unpublished survey data on Japanese MNCs that offer subsidiary-level performance data, we found that a subsidiary's below-ESA performance is a stronger predictor of subsidiary termination than below-ISA performance. However, as a subsidiary's host country experience increases, the effect of below-ISA performance is amplified and even surpasses the effect of below-ESA performance.
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Grazia Santangelo
Professor
Copenhagen Business School
Copenhagen
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