This paper contributes to recent discussions of corporate tax avoidance and global wealth chains. Drawing on multiple case studies, we outline the key strategies adopted by Finnish mining companies ...as they seek to lower their tax burden. After screening the accounts of the companies mining metallic ores in Finland, we provide an in-depth analysis of the tax avoidance arrangements at three of these mines. The mines were operated by two Canadian enterprises that utilized seven different tax avoidance arrangements. The multiple case study approach adopted in this paper is helpful in developing both quantitative and qualitative tax avoidance research, since our findings highlight major deficiencies of datasets commonly used in the dominant quantitative tax avoidance research. Our qualitative approach helps tackle some of the limitations imposed on tax researchers as a result of the considerable secrecy surrounding tax matters. In particular, we argue that the existing tax avoidance research has focused too much on statutory corporate income tax rates even though today, tax minimization relies mostly on specific tax incentives and other loopholes in tax laws. We argue that the arrangements we describe mirror a wider phenomenon where multinational enterprises exert societal power commonly associated with sovereign states. Crossing the disciplinary boundaries of accounting, political economy and tax law, we also contribute to the emerging research agenda on global wealth chains. We call for more attention to the intersections between accounting and tax law for understanding how enterprises can separate their value chains from the intra-firm flows of wealth.
This paper investigates the reverse green innovation spillovers of outward foreign direct investment (OFDI) in Chinese multinational companies and how environmental regulation stringency in host ...countries moderates the relationship between OFDI and green innovation. The empirical analysis is based on an integrated dataset of publicly listed firms from 2008 to 2018. The findings demonstrate a significantly positive relationship between OFDI and the green innovation performance of multinational companies. It is also shown that environmental regulation stringency in host countries positively moderates the relationship between OFDI and green innovation. Further analysis reveals the variation of the findings across multinational companies in host countries at different development stages, with different ownership and in industries with different pollution intensities. The observations in this paper imply that the institutional environment of investment destinations matters for reverse technology spillovers, particularly reverse green technology spillovers from OFDI.
•Positive relationship between OFDI and green innovation of Chinese MNEs.•Environmental regulation stringency in host countries could moderate the relationship between OFDI and green innovation.•Heterogeneity across countries at different development stages.•Heterogeneity across firms with different ownership and pollution intensities.
Purpose
This paper aims to investigate the relationship between the level of subsidiaries’ internal and external relational embeddedness and the degree of subsidiaries’ knowledge transfer. More ...specifically, the aim is to explore dual embeddedness of subsidiaries involved in the knowledge transfer process within multinational corporations’ (MNCs) network.
Design/methodology/approach
The authors empirically analyse 165 European subsidiaries to demonstrate the crucial role of dual relational embeddedness in the transfer of knowledge within MNCs. Data were collected via a close-ended questionnaire and processed through an ordinary least squares regression model.
Findings
Results show that internal embeddedness directly and positively influences the degree of subsidiaries’ knowledge transfer, whereas external embeddedness does not. Notwithstanding, a higher level of both types of embeddedness – known as dual embeddedness – generates multiplicative and positive effects on the degree of subsidiaries’ knowledge transfer.
Practical implications
Best practices and relevant knowledge follow a reverse transfer of knowledge from the subsidiaries to the internal MNC network that is facilitated by the relational embeddedness of subsidiaries. This has resulted in developing a dual embeddedness, which introduces new routines and scripts, as well as more relational links.
Originality/value
The research emphasises the relevance of the knowledge transfer process in multiple directions, evoking the central role of dual-embedded subsidiaries.
Under the conditions of the contemporary economy, the intensification of foreign trade is a fundamental requirement of economic growth, of business internationalization and, implicitly, of economic ...globalization. On the other hand, business development in the international environment, regardless of the size of the economic entities or their field of activity, tends to become a prerequisite of organizational existence. For this reason, the business strategies must be synchronized with the requirements and demands of the economic globalization. In this context, the authors of the present paper aimed to identify and briefly present the main effects of the globalization on the business internationalization and the management of the multinational companies.
Talent Management (TM) has attracted increasing attention from academics and practitioners in recent years, but there are many gaps and omissions left for further theoretical and empirical ...development. One line of debate has been whether TM is merely a re-packaging of what already exists, not being distinct from traditional HRM practices or disciplines. The paper has three main components: (i) a review of how ‘Talent’ and TM has been conceptualised in the literature and the outline of a framework we have derived therefrom which identifies four main perspectives on TM: exclusive-people; exclusive-position; inclusive-people; social capital; (ii) the presentation and analysis of our research findings relating to TM perspectives and practices in seven multinational corporations (MNCs) in Beijing; (iii) a concluding discussion which compares and contrasts our findings with the extant literature and our framework. Six of the companies had adopted ‘exclusive’ perspectives, seeing TM as ‘integrated, selective’ HRM. For some, this involved an ‘exclusive-people’ focus on certain groups of ‘high-performing’ or ‘high-potential’ people, whilst for others it meant an ‘exclusive-position’ focus on certain ‘key’ positions in the organization. Just one organization had adopted an ‘inclusive-people’ approach. Two of the companies emphasized ‘organizationally focussed competence development’, concentrating upon smooth talent flows and development, and moving towards a ‘social capital’ perspective which took cognizance of networks, contexts and relationships as well as human capital. The implications of our findings for research and practice are outlined.
Gender (in)equality varies strongly across countries. However, research has not sufficiently addressed how subsidiaries of multinational companies respond to differences in gender equality between ...home and host countries. Based on interviews with 34 managers, our study explores how subsidiaries experience gender-related challenges in their home and host countries, what kinds of practices they implement to increase gender equality, and which role the headquarters play in the implementation of these practices. We do so by examining the cases of German subsidiaries in Japan and Japanese subsidiaries in Germany, two countries that differ greatly in gender equality. Building on our analysis, we systematically compare how subsidiaries respond to the institutional pressures from their home and host countries and develop a theoretical model that illustrates how gender diversity management in a subsidiary is contingent on the interaction of (1) global integration pressure from the headquarters and (2) the level of gender equality in the home country relative to the host country, linked via different types of collaboration and practice transfer from the headquarters. Theoretical and practical implications of our findings are discussed.
This interdisciplinary study examines why and how corporate leaders operationalize sustainability in organizational strategy, systems and activities. Through interviews with sustainability ...professionals using a cross-industry sample of multinational organizations recognized as top performers by multiple sources (Dow Jones Sustainability Index, Newsweek Green Rankings, GRI, and KLD), the research identified drivers, enablers, evaluation methods and change management practices for corporate social, environmental and financial initiatives. Using multiple coders, and an analysis of responses to structured interview questions, we determine how sustainability professionals influence the alignment of sustainability goals, mission and values at leading organizations. Scholarly contributions include insight into how top performing companies manage change involving social and environmental responsibility. Insights come from primary research with the individuals who anchor those corporate sustainability initiatives providing a foundation for further theory development and testing of propositions. The key findings include integration as a systems-based approach to sustainability, change management, innovation, and corporate strategy. Integration takes place through the alignment of performance metrics within and across business units and functions with a call for Integrated Bottom Line performance measurement throughout organizations and value chains to inform management decision-making, transparency, and external reporting. Predictions are that integration and change management are critical success factor for the advancement of strategic sustainability initiatives.
Purpose: This paper aims to explore and describe how companies manage the level of standardisation of improvement practices in a multisite context. It seeks to explain the managerial strategies ...applied to change the standardisation level in manufacturing companies with multiple production sites worldwide.Design/methodology/approach: This paper collects data through interviews, observations and company documents from a large multinational producing company and, specifically, from of the largest production sites in the company. The research design resembles a grounded theory approach by being reflexive and open to emerging themes. The standardisation strategy was analysed at a company that strived to increase the standardisation of problem-solving practices within about 20 production sites as part of their corporate lean programme.Findings: Several managerial tools were applied at the corporate level to increase the standardisation level of problem-solving practices, such as developing standards and a company-specific toolbox aligned with an in-house maturity model. In addition, deploying change leaders and global implementation targets enabled audits and progress. However, consequences at the production-site level became minor adaptations of standards, the design of training models as a "roll-out", and a resource-demanding implementation process.Originality/Value: This paper empirically demonstrates strategic tools that corporate management teams apply to influence the company's standardisation level of practices. The study describes the purpose and consequences of the design of the toolbox, maturity model, training model, and implementation targets, which aims to simplify the complex task of managing standardisation in a corporate group. By applying a knowledge-based view, four processes (i.e. adaptation, integration, upskilling, and learning) were identified to improve the management strategies in multisite contexts.
We investigate whether U.S. multinational companies use income shifting to facilitate and hide corruption activities by examining whether income shifting responds to corruption pressures. We use ...enforcement actions under the Foreign Corrupt Practices Act (FCPA) as shocks to the costs of direct corruption and find that firms appear to respond to increased costs of direct corruption by shifting income abroad. This corruption-motivated income shifting is more common in industries with greater corruption exposure and among firms with more effective internal controls. We also find evidence that corruption-motivated income shifting acts differently from income shifting for tax avoidance purposes and is difficult for corporate monitors to combat. Overall, our results are consistent with companies using income shifting as an opaque tool for corruption when FCPA enforcement actions curtail more direct forms of corruption.
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