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Can proactive environmental strategy improve Multilatinas' level of internationalization? The moderating role of board independence

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  • Eduardo Duque‐Grisales
  • Javier Aguilera‐Caracuel
  • Jaime Guerrero‐Villegas
  • Encarnación García‐Sánchez

Abstract

This paper explores the relationships between proactive environmental strategy (PES) and internationalization in emerging markets multinationals from Latin America (Multilatinas). Drawing on the resource‐based view and institutional theory and using a sample of 86 listed firms during the period 2013–2017, we find that Multilatinas with higher tiers of PES are associated with higher degrees of geographic international diversification. Because adopting PES is directly conditioned by institutional pressures to comply with stakeholders' regulations and expectations, Multilatinas that implement advanced PES will be able to achieve a higher level of international presence in foreign markets. Our results also reveal that board independence positively moderates the relationship between PES and geographic international diversification. Specifically, board independence provides Multilatinas with the opportunity to integrate valuable knowledge and expertise and thus to take advantage of implementing advanced PES to achieve even greater levels of internationalization. This study expands understanding of how environmental strategies influence internationalization of firms in the Latin American business context.

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  • Eduardo Duque‐Grisales & Javier Aguilera‐Caracuel & Jaime Guerrero‐Villegas & Encarnación García‐Sánchez, 2020. "Can proactive environmental strategy improve Multilatinas' level of internationalization? The moderating role of board independence," Business Strategy and the Environment, Wiley Blackwell, vol. 29(1), pages 291-305, January.
    • Handle: RePEc:bla:bstrat:v:29:y:2020:i:1:p:291-305
    DOI: 10.1002/bse.2377
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    Cited by:

    1. Sibele Recco Rosso Comim, 2020. "Relationship between Chinese firms’ Internationalization and Environmental performance: An empirical evidence," International Journal of Science and Business, IJSAB International, vol. 4(11), pages 111-118.
    2. Kravchenko Grygorii, 2021. "International Experts’ Influence on Company Internationalization," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 29(4), pages 57-90, December.
    3. Ricky Y. K. Chan & Jennifer W. M. Lai & Namwoon Kim, 2022. "Strategic motives and performance implications of proactive versus reactive environmental strategies in corporate sustainable development," Business Strategy and the Environment, Wiley Blackwell, vol. 31(5), pages 2127-2142, July.
    4. Eduardo Duque‐Grisales & Javier Aguilera‐Caracuel & Jaime Guerrero‐Villegas & Encarnación García‐Sánchez, 2020. "Does green innovation affect the financial performance of Multilatinas? The moderating role of ISO 14001 and R&D investment," Business Strategy and the Environment, Wiley Blackwell, vol. 29(8), pages 3286-3302, December.
    5. Simona Galletta & Sebastiano Mazzù & Valeria Naciti, 2021. "Banks' business strategy and environmental effectiveness: The monitoring role of the board of directors and the managerial incentives," Business Strategy and the Environment, Wiley Blackwell, vol. 30(5), pages 2656-2670, July.
    6. Md. Aftab Uddin & Shetu Ranjan Biswas & Swadip Bhattacharjee & Mouri Dey & Monowar Mahmood, 2021. "Inspiring employees' ecological behaviors: The roles of corporate environmental strategy, biospheric values, and eco‐centric leadership," Business Strategy and the Environment, Wiley Blackwell, vol. 30(5), pages 2367-2381, July.

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