Managing institutional distance: Examining how firm-specific advantages impact foreign subsidiary CEO staffing

UNCG Author/Contributor (non-UNCG co-authors, if there are any, appear on document)
Marketa Rickley, Assistant Professor (Creator)
The University of North Carolina at Greensboro (UNCG )
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Abstract: Based on the insight that superior access to knowledge can help foreign firms overcome liabilities of foreignness, we examine whether possession of firm-specific advantages shifts foreign firms’ CEO staffing strategies from local managers, who provide host-market insight, toward expatriates, who possess knowledge transfer and coordination capabilities. We find that, as institutional distance increases, firm-specific advantages from multinationality, regional agglomeration, and host-country experience substitute for the host-market insight of local CEOs. Foreign firms with such advantages instead staff the CEO role with expatriates. Our results are practically relevant to MNCs seeking to allocate a limited talent pool across different institutional contexts.

Additional Information

Journal of World Business, 53(5), 740-751.
Language: English
Date: 2018
CEO selection, multinational companies (MNCs), institutional distance, liabilities of foreignness, executive staffing

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