Partner‐diversity effects on alliance termination in the early stage of green alliance formation: Empirical evidence from carbon‐emission reduction projects in Latin America

Abstract

Partner diversity is a key influencer in interorganizational alliances, and several empirical studies have shown that its outcomes are contingent on alliance‐specific factors. We extend this research as well as the growing literature on green alliances, in which partner diversity is uniquely high. Specifically, we examine partner‐diversity effects on alliance termination in the early stage of green alliance formation. We hypothesize that in this context, size disparity increases termination likelihood, whereas organizational variety and cultural separation have the opposite effect. To test our hypotheses, we use a sample of 366 alliance projects located in Latin America and submitted to the Kyoto Protocol's Clean Development Mechanism for evaluation, validation, and registration from 2004 to 2014. Our findings contribute to several research streams and provide practical guidance for successful formation of alliances focused on environmental protection.

A Literature Review of Inter-Organizational Sustainability Learning

“…Still, in comparison to firm-level outcomes, partnership-level outcomes have been studied even less. In the commercial inter-firm alliance context, partnership effectiveness or success has been frequently discussed [235][236][237] However, in the context of sustainability, only a few studies have focused on partnership terminations [186] and partnership success [171,207]. Future studies can further explore how inter-organizational learning and firm-level outcomes impact perceived partnership performance and study the impact of catalysts and inhibitors on this relationship.…”

“…Having prior relationships with a particular partner is identified as a factor that would help trust formation [152,186]. According to Vinke-de Kruijf, et al [187], "when actors interact with each other over a longer period of time, they gain additional information about other actors that are rooted in relational experiences."…”

“…The review shows the learning from a partnership depends on the cognition and institutional backgrounds of collaborating parties. While the differences are more substantial in the context of cross-sector partnerships, even in the context of inter-firm alliances, partners have varying degrees of corporate environmentalism or corporate sustainability, which means varying value frames about sustainability [186,188]. It is plausible to expect that there would be an optimal distance between the partners whereby they are different enough to learn from each other and, at the same time, close enough to be able to understand each other's language and work together, which would act as a catalyst to inter-organizational learning [11,189].…”

“…Partner opportunism can also be tackled with non-economic mechanisms, including trust and development of social capital [156]. Indeed, the expectation of partner opportunism increases in the existence of another inhibitor: power imbalance; meaning that partners who perceive themselves weak or inferior in the relationship dynamic would expect their partners to act opportunistically, and even engage in opportunism themselves, to shield themselves from potential opportunism and damage the relationship [186].…”

“…One study explicitly focuses on the role of institutional logics and resource dependencies on partnership success [171]. Others refer to 'partnership' or 'alliance' success; however, they do not explicitly measure the impact of various factors on partnership success [186]. Sanzo, Álvarez and Rey [207] proposed that "the existence of a process of learning within the non-profit will probably enhance the firm's perception (and also the non-profit's own appreciation) about the non-profit's capability to contribute to partnership success".…”