Taking a stand while abroad? Towards a theory of MNCs’ sociopolitical activism in host countries

Abstract

With multinational corporations (MNCs) increasingly taking public stances on sociopolitical issues such as immigration, LGBTQ+ rights, and racism, it is imperative that international business (IB) research keeps pace with normative societal debates. In this paper, we introduce the concept of corporate sociopolitical activism (SPA) to the IB literature and develop a theory on why MNCs consistently or inconsistently engage in SPA in response to the same issue in their home country and a host country. We theorize that institutional complexity at three levels of analysis – within a host country, between home and host countries, and beyond the home and host countries – shapes MNCs’ decisions. This paper contributes to the IB literature by situating SPA as a new area within international nonmarket strategy research. In addition, we extend IB research on institutional complexity by theorizing how heterogeneity within a host country influences MNCs’ behaviors. We also expand the focus of the literature on corporate SPA from domestic firms to MNCs. Overall, this paper represents a call to action for IB researchers to examine MNCs’ responses to sociopolitical issues in an increasingly polarized world.