Factors Affecting the Corporate Sustainability Actions Undertaken by Foreign Subsidiaries of Taiwanese Businesses in the Manufacturing Industry: Is the Tail Wagging the Dog Common?
Author
Abstract
This study investigates subsidiary companies located in host countries (hereafter referred to as “host country subsidiaries”) and the factors determining whether foreign subsidiaries of Taiwanese businesses actively or passively take corporate sustainability actions. The multiple-case design method is used to collect data from 10 foreign subsidiaries of Taiwanese businesses, and an integrated framework is developed for the factors prompting foreign subsidiaries to take corporate sustainability actions. The results demonstrate that host country subsidiaries both actively and passively take corporate sustainability actions, and that some host country subsidiaries take more corporate sustainability actions than do parent companies. This study asserts that when taking corporate sustainability actions, host country subsidiaries that gain more competitive advantages from such actions or possess stronger mandate roles in creating such advantages are more inclined to actively take corporate sustainability actions and that their parent companies are more inclined to support their subsidiaries. This finding, which is supported by entrusted management theories and corporate sustainability theories, differs from conventional business theories and supplements the current theories associated with corporate sustainability in host country subsidiaries.
