AIB 2012 Conference Proceedings - Academy of International ...

MONDAY
This paper examines the relationship between board structure and risk taking behavior of emerging market
firms by looking at firms' growth strategies. I investigate two types of growth strategies – growth through
international expansion, and growth through new domestic ventures. More specifically, I study the individual
and joint effects of board structure, network centrality through board interlocks and ownership structure on
firm's growth strategies. Using longitudinal data on 2152 publicly listed Indian firms from 2002 to 2009, I find
that boards that are structured keeping in view the resource dependence role are more helpful in pursuing
growth strategies. (For more information, please contact: Deeksha A. Singh, Temple University, USA:
deeksha@temple.edu)
The Shareholder Value Creation Effects of Corporate Governance on the Internationalisation of Emerging Market
Firms
Lutao Ning, Durham University
Roger Strange, University of Sussex
Jing-Ming Kou, Durham University
The rapid international expansion of firms from emerging economies has caught media attention worldwide and
attracted considerable academic interests over the last decade. Previous research has emphasised emerging
market firms' motivations and strategies for internationalisation. Understanding of whether their
internationalisation through cross-border mergers and acquisitions (CM&As) has created value for shareholders
is still relatively limited. There is also little empirical evidence on the value implications of good corporate
governance for emerging market CM&As. Using a unique and manually collected firm-level dataset, this paper
examines the stock returns upon CM&A announcements made by Chinese multinationals listed in the Hong
Kong Stock Exchange from 1991 to 2011, where firms are subjected to stricter international reporting rules and
accounting standards. The empirical findings support our hypotheses that CM&As by EMNEs create shareholder
value. We also found that the magnitude of created value is positively associated with the effectiveness of
corporate governance, which mainly stems from moderation of principal-principal rather than principal-agent
conflicts as perceived by international investors. (For more information, please contact: Lutao Ning, Durham
University, United Kingdom: lutao.ning@durham.ac.uk)
Returnee Managers and Internationalization of Emerging Economy Firms: The Moderating Role of Corporate
Govenance
Lin Cui, Australian National University
Yi Li, Australian National University
Zijie Li, University of International Business and Economics
Emerging economy (EE) firms recruit returnee managers with international experience to support their growth
into the global market. This study investigates the effect of returnee managers on EE firms' foreign direct
investment (FDI) decisions. Drawing on upper-echelon perspective and the principal-principal conflict
perspective in the corporate governance of EE firms, we argue that the returnee managers have a positive
effect on EE firms' FDI propensity, while this effect is moderated in opposite manners by shareholders who have
conflicts in interests, in particular, the dominant state owner and the influential foreign owner. Our empirical
results from an event history analysis of 164 Chinese listed firms over an 8-year period supported the
hypothesized main effect, and the negative moderating role of foreign ownership. (For more information, please
contact: Lin Cui, Australian National University, Australia: lin.cui@anu.edu.au)
AIB 2012 Conference Proceedings
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