Although recent scholarship helps explain institutional decoupling among countries, there remains a theoretical black box as to the stakeholder processes driving this form of change. Based on a mix of qualitative evidence – interviews with 161 stakeholders (e.g., policymakers, think tank analysts, industry association representatives, and managers), a review of archival data, and case studies of two leading Chinese MNEs’ experiences in the US – we explore the recent history of institutional decoupling between the US government and Chinese stakeholders. We then develop a theoretical process model explaining this history by modifying stakeholder theories. Our model distinguishes the classic conceptualization of stakeholder salience, which we term “positive salience,” from a new type: what we call “negative salience.” We explain how negative salience evaluations arise and diffuse, and their consequences. Foreign governments that accumulate a tipping point of negative salience evaluations among positively salient stakeholders – via the expression, labeling, incongruence, and re-expression of interests – become targets of institutional decoupling by a perceiving home government, and these evaluations are transferable to MNEs. In addition, we show how our model more fully explains decoupling than liabilities of origin theory, and discuss the implications of our research for both MNE managers and policymakers.

Governments are increasingly using public procurement to promote financial and non–financial policy goals, including requiring adherence to sustainability standards to ensure sustainable procurement. Recent literature has highlighted supplier firms endeavouring to conduct CSR practices to indirectly signal their adherence and trustworthiness to governments, increasing their likelihood of winning an international government procurement contract. In this paper, we make the case for ESG performance and indicate its importance for supplier firms in signalling interorganizational trust to foreign governments. We develop the argument and highlight its importance for managers and policymakers, indicating the possibility of a global ESG criteria which functions at the state and firm levels.

Hillman and Hitt’s (1999) theoretical framework is used to explore the mechanisms through which non-market strategies (NMS) affect firm performance. Multiple studies investigating the benefits of NMS unfortunately continue to generate mixed results despite NMS becoming increasingly common (especially amongst multinational corporations) due to widespread agreement that collaboration between firms and governments is required to achieve smarter policies for sustainable economic growth. The UK Open Government Dataset is used to identify 480 corporations’ political encounters with the UK government between 2012 to 2019. The mean of political encounters (3.04) is operationalised to construct a dummy variable (FPA) to categorise firms’ political approach as relational or transactional and General Least Square – Random Effect (GLS – RE) is utilised to conduct regression models. The results demonstrate that only the transactional approach yields an increase in firms’ fortunes. The research focuses mainly on agency theory and Resource-based View perspectives to reveal a clear underlying mechanism explaining how firms’ performance is impacted when conducting NMS.

Intergovernmental organizations (IGOs) promote stability, development, and security for member states and their citizens via supranational institutional influences. However, their impact on individuals has been questioned due to political, social, and economic uncertainties. We study how IGOs influence entrepreneurial decision-making. Using a robust sample of 68 countries, their entrepreneurial environment, and their connection to IGOs, we find that IGOs cultivate a positive environment for entrepreneurship. Moreover, IGOs encourage different strategic decisions - encouraging formal entrepreneurship while discouraging informal entrepreneurship. We combine insights from international relations, institutional theory, and strategic entrepreneurship to highlight how institutions at different levels influence entrepreneurial decision-making.