The Dynamic between Firms' Environmental Strategies and Institutional Constraints in Emerging Economies: Evidence from China and Taiwan

31 Pages Posted: 14 Jan 2005

See all articles by John Child

John Child

University of Plymouth - Plymouth Business School

Terence Tsai

The Chinese University of Hong Kong (CUHK) - Department of Management

Abstract

This paper combines institutional and political perspectives to develop a framework for analysing firms' strategies in relation to demands for environmental protection in emerging economies. The main subjects for an examination of the framework and the issues it raises are three large-scale diversified multinational corporations (MNCs) in the chemicals sector, each with manufacturing in both China (PRC) and Taiwan. They are contrasted with four local firms in the same sector. An accommodation between MNCs' strategies and institutional constraints is achieved through a system of dynamic relationships in which both firms and institutional agents have a stake. Institutions are found to be more pervious to corporate strategic action than has been assumed by recent institutional theory, and with consequences that are not necessarily inimical to local community interests. The study offers new insights into (1) the processes that lead to conformity in corporate environmental practices (isomorphism), (2) the need to extend the normal purview of institutional theory, and (3) the contribution of a political perspective that allows for MNC proactivity.

Suggested Citation

Child, John and Tsai, Soo Hung Terence, The Dynamic between Firms' Environmental Strategies and Institutional Constraints in Emerging Economies: Evidence from China and Taiwan. Journal of Management Studies, Vol. 42, No. 1, pp. 95-125, January 2005, Available at SSRN: https://ssrn.com/abstract=648745

John Child (Contact Author)

University of Plymouth - Plymouth Business School ( email )

Mast House
Plymouth, Devon PL4 8AA
United Kingdom

Soo Hung Terence Tsai

The Chinese University of Hong Kong (CUHK) - Department of Management ( email )

Shatin, N.T.
Hong Kong

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