Liabilities of origin and its influence on firm's corporate social performance? A study of emerging market multinational corporations

Abstract

This study draws upon the institutional‐based view to examine how home country institutional voids affect the corporate social performance (CSP) of emerging market multinational corporations (EMNCs). We propose that home country institutional voids of EMNCs are positively related to CSP. We also argue that EMNCs' internationalization and visibility will further augment the above relationships. We tested our hypotheses using a sample of 89 EMNCs from 10 countries from 2009 to 2018 and found support for our arguments. Our findings show that EMNCs use CSP to overcome the liabilities of origin due to their home‐country institutional voids. Internationalization and visibility increase the challenges of origin liabilities and EMNCs respond by enhancing their CSP. Our research adds to the existing knowledge base on institutional voids within the realm of international business.

ESG Practices and Financial Stability in Emerging Market Healthcare Companies: Insights Amidst the COVID‐19 Pandemic

“…These requirements vary by country and typically encompass a broad spectrum of ESG issues, such as climate change, labor practices, human rights, and anticorruption practices (Cui, Jo, and Na 2020;Krueger et al 2024). Further, a study by Venugopal et al (2023) shows that emerging market multinational corporations (EMNCs) enhance their corporate social performance to overcome home-country institutional voids. Internationalization and visibility further strengthen this effect.…”