How to create trust in multinational corporations? Cross-cultural contingencies in fair strategy process
Peeters, Carine Tackx, Koen
Peeters, Carine
Tackx, Koen
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Conference Proceeding
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2016
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Abstract
This paper proposes a conceptual framework and empirical validation to explain how a culturally differentiated application of the procedural justice theory may enhance the functioning of a multinational corporation (MNC). Using original survey data on 103 managers of international corporations who are strongly involved in headquarter-subsidiary relationships, we study how power distance and individualism-collectivism dimensions of culture moderate the relation between the constituents of procedural justice and the trust subsidiaries have in their headquarters. The analysis suggests that for managers originating from a ‘low power distance’ culture, the perception of changeability in the strategy process has much more impact than for managers stemming from a ‘high power distance’ culture. Also, towards managers with a more ‘collectivist’ background, ensuring that expectations and decisions are clear enhances trust more than for managers with a more ‘individualist’ background.
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Strategy, Cross-Cultural Contingency