TY - JOUR
T1 - Host-country climate risk and the expansion of emerging market firms
T2 - a strategic tripod application
AU - Wu, Sihong
AU - Fan, Di
AU - Soo, Christine
PY - 2024
Y1 - 2024
N2 - Climate risk is a pressing global concern that affects multinational enterprises in manifold ways. Yet this has received less attention in international management literature. To address the gap, this study examines the impact of climate risk on the expansion and performance of emerging multinational enterprises (EMNEs) and tests the moderating effects of industry and institutional factors on the relationships. Using a dataset comprising the international acquisitions initiated by MNEs from emerging markets in 1998–2018, we find that host-country climate risk negatively affects the firms’ expansionary entries and is detrimental to firm performance. In addition, we find that firms from high-polluting industries are likely to show greater environmental awareness and increase their commitment to climate-risk countries. At the country level, our results show that home-host country political ties reduce the negative impact of climate risk on firms’ expansion and performance. The findings contribute to the literature on environmental management in an international business context and offer important practical implications for managers and government agencies.
AB - Climate risk is a pressing global concern that affects multinational enterprises in manifold ways. Yet this has received less attention in international management literature. To address the gap, this study examines the impact of climate risk on the expansion and performance of emerging multinational enterprises (EMNEs) and tests the moderating effects of industry and institutional factors on the relationships. Using a dataset comprising the international acquisitions initiated by MNEs from emerging markets in 1998–2018, we find that host-country climate risk negatively affects the firms’ expansionary entries and is detrimental to firm performance. In addition, we find that firms from high-polluting industries are likely to show greater environmental awareness and increase their commitment to climate-risk countries. At the country level, our results show that home-host country political ties reduce the negative impact of climate risk on firms’ expansion and performance. The findings contribute to the literature on environmental management in an international business context and offer important practical implications for managers and government agencies.
KW - Climate risk
KW - high-polluting firms
KW - international expansion
KW - performance
KW - political partnership
UR - http://www.scopus.com/inward/record.url?scp=85192752156&partnerID=8YFLogxK
U2 - 10.1080/14486563.2024.2336965
DO - 10.1080/14486563.2024.2336965
M3 - Article
AN - SCOPUS:85192752156
SN - 1448-6563
VL - 31
SP - 204
EP - 237
JO - Australasian Journal of Environmental Management
JF - Australasian Journal of Environmental Management
IS - 2
ER -