Are Reshoring Decisions Influenced by External Stakeholders and Country-Level Environmental Regulation?

Sena, Vania and Kanungo, Rama and Ozdemir, Sena and Yannopoulou, Natalia and Patel, Parth (2022) Are Reshoring Decisions Influenced by External Stakeholders and Country-Level Environmental Regulation? British Journal of Management. ISSN 1467-8551

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Abstract

The rationale behind reshoring activities remains unclear. Multinationals reshore their subsidiaries when regulations in the host country become too costly or difficult to manage. However, it is unclear whether the positive association between the propensity for reshoring subsidiaries and the host country’s regulations applies to all types of subsidiaries (i.e. majority- or minority-owned) and whether it is moderated by other factors. We suggest that external stakeholders play a crucial role in strengthening the relationship between the decision to reshore and the host country’s regulations. Within the context of international business, we examine the reshoring decision of a panel of subsidiaries controlled by UK multinationals located in 39 countries and focus on a specific set of environmental and corporate governance regulations. Our findings suggest that reshoring among minority-owned subsidiaries is more likely to happen in countries with weak protection of shareholders and mandatory environmental disclosure. Such a relationship is also strengthened by the presence of external stakeholders, namely foreign directors sitting on subsidiaries’ boards. We contribute to the reshoring literature by showing the role of external stakeholders and the impact of institutions and regulatory requirements on reshoring decisions.

Item Type:
Journal Article
Journal or Publication Title:
British Journal of Management
Additional Information:
This is the peer reviewed version of the following article: Sena, V., Kanungo, R.P., Ozdemir, S., Yannopoulou, N. and Patel, P. (2022), Are Reshoring Decisions Influenced by External Stakeholders and Country-Level Environmental Regulation?. Br. J. Manag.. https://doi.org/10.1111/1467-8551.12680 which has been published in final form at https://onlinelibrary.wiley.com/doi/10.1111/1467-8551.12680 This article may be used for non-commercial purposes in accordance With Wiley Terms and Conditions for self-archiving.
Uncontrolled Keywords:
/dk/atira/pure/subjectarea/asjc/1400/1405
Subjects:
ID Code:
177512
Deposited By:
Deposited On:
14 Oct 2022 10:50
Refereed?:
Yes
Published?:
Published
Last Modified:
28 Nov 2022 09:50