AbstractMultinational enterprises (MNEs) face increasing institutional complexity as they expand internationally, which has a significant effect on their corporate social responsibility (CSR) strategy. In this study, we investigate an under‐explored difference between MNEs' employee and environmental CSR disclosure quality concerning the extent to which CSR reports are indicative of substantive activities. We propose that as international diversification increases institutional complexity, MNEs lower the disclosure quality of environmental CSR yet improve the disclosure quality of employee CSR due to their different institutional implications. In addition, we examine the effect of MNEs' home country cultural differences regarding uncertainty avoidance on the relationship between international diversification and employee and environmental disclosure quality. Based on a sample of 335 global MNEs from 31 countries, we found general support for our hypotheses.
Purpose The purpose of this paper is to identify some of the major issues relating to the conceptualization and operationalization of industry globalization.
Findings Globalized industries have four important characteristics: cross-border product flows, cross-border capital flows, dispersal of global value chains and global competition. However, lack of availability of data limits our ability to develop an operationalization that encompasses all these four aspects of globalization.
Practical implications The authors identify some of the most important factors driving industry globalization as well as the major impediments to globalization.
Originality/value Although the term "globalization" has attained a nearly "taken for granted" status, its meaning is rather vaguely specified and is often context dependent. This paper delineates the domain of the construct and identifies many of the practical issues in operationalizing the construct.
PurposeThere is considerable variation in the extent of globalization across industries. The authors attempt to identify the structural conditions of the industry that lead to these variations.Design/methodology/approachBased on a sample of 33 manufacturing industries over the nine-year period from 2007 to 2016, the authors test for antecedents of industry globalization.FindingsThe authors find that industry globalization is positively affected by medium levels of barriers to entry, industry competition, industry assistance, low and mediums levels of capital intensity, industry concentration and industry regulation and negatively affected by low levels of technological change and industry assistance. In addition, the life cycle stage of the industry has an impact on the level of globalization with the growth stage having the highest level of globalization.Research limitations/implicationsFirst, the major limitation of the paper is that the authors rely entirely on trade data to measure the level of industry globalization. The authors did not have a choice because foreign direct investment (FDI) data are available only at the country level. Second, given that globalization can occur at the country, industry and firm levels, the focus on industry-level structural characteristics alone may be seen as a limitation.Practical implicationsThe results of the study can provide guidance to practicing managers to apply industry analysis for predicting the potential for and direction of globalization of their industries. This will enable them to formulate appropriate strategies to cope with global competition.Social implicationsThe study has important public policy implications. National governments have many levers at their command that can be used to influence the structural characteristics of industries, such as industry regulation, industry assistance and industry concentration. They can selectively use these levers to either facilitate or impede globalization.Originality/valueMuch of the empirical focus of prior research on globalization has been on countries, rather than industries, as the unit of analysis. There is clearly variation in the extent of globalization across industries with some industries highly integrated while others remain primarily local or regional. Based on a novel approach to measure the extent of globalization at the industry level, the authors identify its antecedents. The value of the paper lies in the fact that the analysis of 33 manufacturing industries over a ten-year period shows that the structural characteristics of the industries drive their extent of globalization.
