This paper highlights the evolution and contribution of the institutional theory perspective to the study of human resource management (HRM) transfers between advanced economies and less developed economies owing to institutional dissimilarities. The paper seeks to explore the institutional differences between advanced economies (home) and less developed economies (host) through the lens of institutional theory and how such institutional differences constrain or provide opportunities for the transfer of HRM practices. We develop a conceptual framework through the lens of institutional theory to provide useful and comprehensive insight of factors or conditions to consider when transferring HRM practices from advanced economies to less developed economies where there are institutional dissimilarities. The framework offers a broad perspective of the three dimensions of institutional theory to help multinational enterprises evaluate and explore how the differences in institutional settings between home and host countries may create opportunities or constraints in HRM practice transfers.Keywords: human resource management practices, institutional dissimilarities, institutional theory, international human resource management, multinational enterprises Key points 1 Our conceptual framework identifies those factors or conditions to consider when multinational enterprises transfer human resource management (HRM) practices from advanced economies to their subsidiaries in less developed economies. 2 The framework is based on institutional theory to evaluate and explore how the differences in institutional configurations between home and host countries may create opportunities or constraints in HRM practice transfers. 3 Institutional theory is significant for international HRM research in that it provides a strong foundation in hypothesizing at both home and host country levels with regards to institutional dissimilarities between developed and less developed countries. Newcastle) is a professor of HRM at the School of Management, Curtin University, Perth, Australia. His main research interests are HRM practices in multinational enterprises, work, technology and new employment arrangements, workplace partnerships and consultation and EEO and diversity management in the workplace.Kerry Brown (PhD, Griffith) was a professor of HRM at the School of Management, Curtin University, Perth; however, she is now at Edith Cowan University, Perth, Australia. 1 Her main fields of research are employment relations and public management.