Institutional dysmorphia: when the institutions become ill

Abstract

Purpose The purpose of this paper is to discuss the influence of SOEs on institutions. The authors argue that in some cases there are differences in institutional shape between the shape that is actually demanded by an institution’s institutional environment and the shape that the institution itself believes is demanded of its institutional framework. The authors observed a behavior specific to institutions that change their institutional shape in response to demands, irrespective of whether these demands are legitimate, and this behavior was primarily in response to demands from governments and SOEs. The authors call this situation institutional dysmorphia and contrast it with institutional isomorphism. Design/methodology/approach This study is characterized by the qualitative approach and descriptive form. It is also a documentary study employing the systematic review technique and critical appreciation in a research group. The case of the Brazilian National Development Bank (BNDES) is analyzed to examine the different relationships between Brazilian SOEs and BNDES. It used secondary data provided by reports, papers and relevant magazines. The authors compare them with the conceptual purpose originated in the Medicine field. Findings The study is illustrated by the case of the BNDES and the various different relationships between Brazilian SOEs and BNDES are examined. This is a qualitative and descriptive documentary study, employing the systematic review technique. Specific behavior is observed in institutions that change their institutional shape in response to demands, irrespective of whether these demands are legitimate, and these demands mainly come from the government and from SOEs. Research limitations/implications The authors use of secondary data from only one country that was used to present these arguments. The focus was restricted to the institutional framework comprising one institution and SOEs. Private firms were not considered in this institutional framework, but they must be included in a macro-environment. Institutional pressures are dynamic and asymmetric. The dynamism of institutional change was not evaluated, and neither was the evolution of the relationships between government, SOEs and institutions. Finally, researchers need to understand not only top-down models of institutional effects but also the institutional process that incorporates both institutional influence and firm responses. Originality/value The term institutional dysmorphia is proposed through the contrast with concepts such institutional isomorphism, with reference to the institutional logics and institutional complexity of these institutions’ and SOEs’ environment. The situation described institutional dysmorphia happening in emerging countries context and might open new avenues for research.

Corporate social responsibility of Islamic and conventional banks

“…Formal institutions relate to the functioning of regulatory institutions such as constitutions, laws, property rights and governmental regulations (Mair et al , 2012). Formal institutions may guide institutional mimetic isomorphism (DiMaggio and Powell, 1983) or a firms’ emulation of another firm’s best-practice as a means to increase legitimacy (Monticelli et al , 2018). Therefore, isomorphism may lead to convergent CSR behavior from companies sharing the same business context, whether they are conventional or Islamic organizations.…”

A neo-institutional view of the transaction cost drivers of construction supply chain risk management

“…The findings showed that despite the introduction of new rules-based policies for SCRM, traditional relational and embedded networks shape CSC's institutional environment via distinct but interlinked neo-institutional pressures for risk analysis, identification, and treatment in state and private CSC. More so, the study advances a theoretical framework for the different neo-institutional cycles of SCRM that give rise to institutional dysmorphia between state-owned and private firms, as described by Monticelli et al (2018).…”

“…In addition to the institutional pressures that characterize actors' risk behaviors in an organizational field, governments' elite interests also contribute to institutional isomorphism (DiMaggio and Powell, 1983). In this regard, Monticelli et al (2018) found that firms in volatile or transition economies display a form of institutional dysmorphia by selecting markedly different management strategies from their counterparts in stable and regulated economies. China's expanding hegemony in the global construction sector provides an exciting context to explore the impact of neoinstitutionalism on the SCRM strategies used in global construction projects (Morck et al, 2008;Olson and Wu, 2011).…”

“…Instead, specific contractual clauses that cover procurement risks are included in the fixed unit price or lump sum price contracts predominant in China's CSC (Wang and Fang, 2018). As illustrated in this example, customary institutions remain central to China's SCRM strategies in CSC, despite ongoing regulatory reforms (Peng, 2000;Peng, 2003;Monticelli et al, 2018). Furthermore, to deliver successful construction projects, local, international, and Sino-foreign CSC actors require common regulatory and procedural goals under conditions of uncertainty and task interdependence (Lavikka et al, 2015;Peng, 2000).…”

Institutional drivers, historical determinism, and economic development in Mozambique

“…From an international business perspective, for example, institutions in emerging markets have been shown to affect foreign direct investment (Barnard & Luiz, 2018;Buckley, Chen, Clegg, & Voss, 2018;Gaur, Ma, & Ding, 2018;Iammarino, 2018;Mahembe & Odhiambo, 2016;Wang & Li, 2018), corruption (Luiz & Stewart, 2014;Puffer, McCarthy, & Jaeger, 2016;Rabbiosi & Santangelo, 2018;Sartor & Beamish, 2018), the execution of business models (Urban & Hwindingwi, 2016), the nature and management of political risk (Giambona, Graham, & Harvey, 2017), innovation (Newburry, McIntyre, & Xavier, 2016;Peng, Ahlstrom, Carraher, & Shi, 2017); and the behavior of firms more generally within an international business context (Doh, Rodrigues, Saka-Helmhout, & Makhija, 2017;Luiz & Ruplal, 2013;Luiz, Stringfellow, & Jefthas, 2017;Meyer & Peng, 2016), amongst other impacts. It is therefore important for us to fully grasp the long-run, potentially deterministic, consequences of good or bad institutions, (Jackson & Deeg, 2019;Monticelli et al, 2018) on developing and emerging markets because vast parts of the world are going to be experiencing significant transitions (both political and economic) in the foreseeable future.…”