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Research SummaryAlthough rising geopolitical tension is critically affecting multinational enterprises (MNEs), our understanding of geopolitics and its effects on corporate strategy is surprisingly limited. This study sheds light on this underexplored topic by examining the environmental, social, and governance (ESG) strategy of foreign MNEs amid tension between their home and host countries. We argue that the media plays a critical role in shaping host‐country public perceptions of such tension. As media‐reported tension increases, foreign MNEs enhance their subsidiaries' ESG performance to alleviate potential institutional pressure from the host‐country public. We further show that historical conflicts positively moderate this relationship, whereas ongoing conflicts serve as a scope condition that diminishes this relationship. This manifests that MNEs attempt to maximize ESG's insurance‐like benefits in coping with geopolitics.Managerial SummaryRising geopolitical tension leading to a less stable global business environment highlights the growing importance of geopolitics and strategic responses of firms. This study explores how host‐country media coverage of geopolitical tension affects foreign MNEs. If host‐country news media reports more tense interactions between MNE's home and host countries, the MNE ex ante is likely to experience heightened pressure from the host‐country public. Thus, we argue and show that MNEs subject to pressure from the host‐country public intensify their ESG efforts to enjoy the insurance‐like benefits of ESG's prosocial initiatives. Our study also shows that both past and ongoing conflicts between home and host countries differentially influence MNE's ESG efforts because the anticipated effectiveness of their strategy is heterogeneous.
Research SummaryAlthough rising geopolitical tension is critically affecting multinational enterprises (MNEs), our understanding of geopolitics and its effects on corporate strategy is surprisingly limited. This study sheds light on this underexplored topic by examining the environmental, social, and governance (ESG) strategy of foreign MNEs amid tension between their home and host countries. We argue that the media plays a critical role in shaping host‐country public perceptions of such tension. As media‐reported tension increases, foreign MNEs enhance their subsidiaries' ESG performance to alleviate potential institutional pressure from the host‐country public. We further show that historical conflicts positively moderate this relationship, whereas ongoing conflicts serve as a scope condition that diminishes this relationship. This manifests that MNEs attempt to maximize ESG's insurance‐like benefits in coping with geopolitics.Managerial SummaryRising geopolitical tension leading to a less stable global business environment highlights the growing importance of geopolitics and strategic responses of firms. This study explores how host‐country media coverage of geopolitical tension affects foreign MNEs. If host‐country news media reports more tense interactions between MNE's home and host countries, the MNE ex ante is likely to experience heightened pressure from the host‐country public. Thus, we argue and show that MNEs subject to pressure from the host‐country public intensify their ESG efforts to enjoy the insurance‐like benefits of ESG's prosocial initiatives. Our study also shows that both past and ongoing conflicts between home and host countries differentially influence MNE's ESG efforts because the anticipated effectiveness of their strategy is heterogeneous.
Purpose The purpose of this paper spans twofold. Firstly, to investigate Human Resource Management practices (HRMP) adopted by organisations during the pandemic. Secondly, to bundle similar HRMP into Human Resource Management (HRM) bundles that provided unhindered organisational support to employees during the crisis. Design/methodology/approach The authors conducted 39 in-depth interviews across industries using a semi-structured interview schedule. Thereafter, the authors transcribed the interviews verbatim and analysed them thematically using MAXQDA 2021. Findings The study identifies effective practices during times of uncertainty and how soft HRM practices helped organisations survive during a crisis. When bundled together, these practices enabled organisations to continue operations during the pandemic, keeping their employees engaged and motivated. Practical implications Based on the learnings from the COVID-19 pandemic, the study provides a toolkit of HRMP bundles that organisations can adopt for future crisis management, enhancing the organisations’ absorptive capacity. Originality/value The study investigates the practices incorporated during COVID-19, leading to the identification of soft HRM bundles. The study adds value to the existing domain of HRM by including a unique set of soft HRMP bundles that have not been discussed in earlier studies and could be of high utility to organisations during the crisis.
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