Performance implications of nonmarket strategy in China

Abstract

Nonmarket strategy may have positive influences on a firm’s performance. How does nonmarket strategy influence a firm’s performance? This article addresses this important question by introducing two mediators: corporate social performance and adaptive capability. The empirical results based on a survey of 438 usable questionnaires from China indicate that “buffering” and “bridging,” being two kinds of nonmarket strategies, have a positive impact on a firm’s economic performance through enhancing its social performance and adaptive capability. The article not only documents the positive effect of nonmarket strategy on firm performance in emerging economies such as China, but also explains the indirect relationship between nonmarket strategy and economic performance, which generates both theoretical and practical implications. Copyright Springer Science+Business Media, LLC 2007Nonmarket strategy, Buffering, Bridging, Economic performance, Corporate social performance, Adaptive capability,

Environmental risks, localization and the overseas subsidiary performance of MNEs from an emerging economy

“…Similar to previous studies (He, Tian & Chen, 2007;Lu et al, 2010;Woodcock, Beamish & Makino, 1994), this study adopted the same perceptual measure for the subsidiary performance of Chinese MNEs. This self-evaluation approach was appropriate because (1) firms were either unwilling or unable to provide sensitive accounting data (e.g.…”

“…Although difficulties such as self-enhancement and objectivity might be encountered, self-evaluated surveys have been proved to possess strong internal consistency and reliability (Cooper & Artz, 1995;Ketokivi & Schroeder, 2004) and have been widely used in previous studies (Andersson, Forsgren & Holm, 2002;Birkinshaw, Hood & Young;He et al, 2007;Lu et al, 2010).…”

The influence of firm, industry and network on the corporate social performance of Japanese firms

“…He, Tian, & Chen, 2007;Roman, Hayibor, & Agle, 1999;Waddock & Graves, 1997) and the sustainability of above average profitability (Roberts & Dowling, 2002). This result is, however, equivocal.…”

Expatriates, subsidiary autonomy and the overseas subsidiary performance of MNEs from an emerging economy

“…The detailed information on subsidiary locations is presented in Table 1. & Xu, 2002;He, Tian, & Chen, 2007;Lu, et al, 2010), a perceptual measure was used to proxy the performance of overseas subsidiaries of Chinese MNEs. Some researchers (He, Tian, & Chen, 2007;Woodcock, Beamish, & Makino, 1994) indicated that perceptual measures are appropriate when (1) companies are either unwilling or unable to provide sensitive accounting data; (2) variations in accounting approaches across countries is likely to hinder the reconciliation of differences; and/or (3) there are fluctuations in exchange rates between home and host countries.…”

“…& Xu, 2002;He, Tian, & Chen, 2007;Lu, et al, 2010), a perceptual measure was used to proxy the performance of overseas subsidiaries of Chinese MNEs. Some researchers (He, Tian, & Chen, 2007;Woodcock, Beamish, & Makino, 1994) indicated that perceptual measures are appropriate when (1) companies are either unwilling or unable to provide sensitive accounting data; (2) variations in accounting approaches across countries is likely to hinder the reconciliation of differences; and/or (3) there are fluctuations in exchange rates between home and host countries. As a widely used construct in previous studies (Andersson, Forsgren, & Holm, 2002;Birkinshaw, Hood, & Young, 2005;He, Tian, & Chen, 2007;Lu, et al, 2010), perceptual measures of performance have been proved to possess strong internal consistency and reliability (Cooper & Artz, 1995;Ketokivi & Schroeder, 2004).…”