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Differentiated effects of formal and informal institutional distance between countries 2 on the environmental performance of multinational enterprises

Aguilera-Caracuel, J., Hurtado-Torres, N.E., Aragón-Correa, J.A. and Rugman, A. (2013) Differentiated effects of formal and informal institutional distance between countries 2 on the environmental performance of multinational enterprises. Journal of Business Research, 66 (12). pp. 2657-2665. ISSN 0148-2963

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To link to this item DOI: 10.1016/j.jbusres.2013.04.002

Abstract/Summary

This research examines the influence of environmental institutional distance between home and host countries on the standardization of environmental performance among multinational enterprises using ordinary least-squares (OLS) regression techniques and a sample of 128 multinationals from high-polluting industries. The paper examines the environmental institutional distance of countries using the concepts of formal and informal institutional distances. The results show that whereas a high formal environmental distance between home and host countries leads multinational enterprises to achieve a different level of environmental performance according to each country's legal requirements, a high informal environmental distance encourages these firms to unify their environmental performance independently of the countries in which their units are based. The study also discusses the implications for academia, managers, and policy makers.

Item Type:Article
Refereed:Yes
Divisions:Henley Business School > International Business and Strategy
ID Code:32186
Uncontrolled Keywords:Multinational enterprises; Environmental performance; Formal and informal environmental distance between countries; Country and firm-specific advantages
Publisher:Elsevier

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