Cultural Entrepreneurship in Corporate Governance Practice Diffusion: Framing of “Independent Directors” by U.S.-Listed Chinese Companies
研究美国上市中国公司如何通过框架构建，向投资者强调独立董事的监督角色而非资源提供角色，以获取合法性，并分析董事会海外教育背景、外资持股等资源的影响。
Although the diversity of cultural expectations for different corporate governance practices has been acknowledged, our understanding of how companies use cultural differences to legitimize their governance practice choice and facilitate their resource acquisition remains limited. Building on the literature on cultural entrepreneurship, we theorize how foreign-listed firms engage in global framing in tailoring the description of their new governance practice to the host country investors. Our empirical study examines the relative emphasis of monitoring over resource-providing roles by the U.S.-listed Chinese companies’ independent directors when their roles are understood differently in the home and host countries. Our study finds that exposure to the alternative cultural repertoire of a host country via overseas education of board members and foreign institutional ownership enhance a firm’s organizational resources available to engage in global framing. The likelihood of global framing, however, is constrained by the home country’s institutional environment, which is characterized by local business history and connections to strong local resource providers such as the state. We also find that the effectiveness of global framing to obtain investor recognition in the host country is restricted when the company lacks the capacity to implement the declared role of independent director-as-monitor in its home country.