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Entrepreneurial leadership and MNE subsidiary performance: The moderating role of subsidiary context

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Abstract

Managers of international subsidiaries, especially subsidiary CEOs, operate at critical interfaces within multinational enterprises (MNEs) and hold strategic responsibility for the operations in their country. Yet, their impact on subsidiary performance has received scant research attention. Building on the subsidiary entrepreneurship and strategic leadership literatures, we develop a model of how subsidiary CEOs' entrepreneurial leadership affects subsidiary performance, and how this relationship is moderated by the subsidiary context that determines managerial discretion. We combine survey data of 291 international subsidiaries in South Korea with archival data to test our hypotheses. Our results show that subsidiary CEOs' entrepreneurial leadership enhances subsidiary performance and that this relationship is strengthened by managerial discretion. Our study highlights the pivotal role of subsidiary CEOs within MNEs and contributes to a microfoundational understanding of international subsidiary management.

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[Sarabi, Almasa] Univ Erlangen Nurnberg, Nurnberg, Germany

[Froese, Fabian J.] Univ Goettingen, Gottingen, Germany

[Chng, Daniel H. M.] China Europe Int Business Sch, Shanghai, Peoples R China

[Meyer, Klaus E.] Western Univ, Ivey Business Sch, London, ON, Canada


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Source

International Business Review

ISSN:0969-5931

Year:2020

Issue:3

Volume:29

ESI Discipline:ECONOMICS & BUSINESS;

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