IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v69y2024ipbs1544612324012765.html

Internationalization speed and corporate long-term performance: Exploring the inverted U-shaped relationship

Author

Listed:
  • Xiong, Zeyuanfeng
  • Sun, Chunxu
  • Zhao, Meihui

Abstract

Using data from China's A-share listed companies spanning 2002 – 2022, our research uncovers an intriguing inverted U-shaped dynamic between the velocity of firms' internationalization and their long-term performance. It reveals that while an initial acceleration in internationalization bolsters performance, an overly rapid pace can subsequently lead to a deterioration. Critically, the proportion of independent directors acts as a moderating factor, as a higher concentration of these directors facilitates a balance between the speed and risks associated with internationalization, ultimately optimizing long-term corporate performance. These findings offer vital insights for companies navigating their internationalization strategies and emphasize the importance of robust corporate governance.

Suggested Citation

  • Xiong, Zeyuanfeng & Sun, Chunxu & Zhao, Meihui, 2024. "Internationalization speed and corporate long-term performance: Exploring the inverted U-shaped relationship," Finance Research Letters, Elsevier, vol. 69(PB).
    • Handle: RePEc:eee:finlet:v:69:y:2024:i:pb:s1544612324012765
    DOI: 10.1016/j.frl.2024.106247
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612324012765
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2024.106247?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Zahoor, Nadia & Al-Tabbaa, Omar, 2021. "Post-entry internationalization speed of SMEs: The role of relational mechanisms and foreign market knowledge," International Business Review, Elsevier, vol. 30(1).
    2. Jiang, Guohua & Kotabe, Masaaki & Zhang, Feng & Hao, Andy W. & Paul, Justin & Wang, Cheng Lu, 2020. "The determinants and performance of early internationalizing firms: A literature review and research agenda," International Business Review, Elsevier, vol. 29(4).
    3. Zhang, Wenting & He, Xie & Hamori, Shigeyuki, 2023. "The impact of the COVID-19 pandemic and Russia-Ukraine war on multiscale spillovers in green finance markets: Evidence from lower and higher order moments," International Review of Financial Analysis, Elsevier, vol. 89(C).
    4. Gyimah, Daniel & Kwansa, Nana Abena & Kyiu, Anthony K. & Sikochi, Anywhere (Siko), 2021. "Multinationality and capital structure dynamics: A corporate governance explanation," International Review of Financial Analysis, Elsevier, vol. 76(C).
    5. Freixanet, Joan & Renart, Gemma, 2020. "A capabilities perspective on the joint effects of internationalization time, speed, geographic scope and managers’ competencies on SME survival," Journal of World Business, Elsevier, vol. 55(6).
    6. Au Yong, Hue Hwa & Laing, Elaine, 2021. "Stock market reaction to COVID-19: Evidence from U.S. Firms’ International exposure," International Review of Financial Analysis, Elsevier, vol. 76(C).
    7. Yu, Honglan & Fletcher, Margaret & Buck, Trevor, 2022. "Managing digital transformation during re-internationalization: Trajectories and implications for performance," Journal of International Management, Elsevier, vol. 28(4).
    8. Popli, Manish & Ahsan, Faisal M. & Mukherjee, Debmalya, 2022. "Upper echelons and firm internationalization: A critical review and future directions," Journal of Business Research, Elsevier, vol. 152(C), pages 505-521.
    9. Sadeghi, Arash & Aliasghar, Omid & Bouguerra, Abderaouf, 2023. "Unpacking the relationship between post-entry speed of internationalization and export performance of SMEs: A capability-building perspective," Journal of International Management, Elsevier, vol. 29(1).
    10. Oliveira, Luis & Johanson, Martin, 2021. "Trust and firm internationalization: Dark-side effects on internationalization speed and how to alleviate them," Journal of Business Research, Elsevier, vol. 133(C), pages 1-12.
    11. Acedo, Francisco J. & Coviello, Nicole & Agustí, María, 2021. "Caution ahead! The long-term effects of initial export intensity and geographic dispersion on INV development," Journal of World Business, Elsevier, vol. 56(6).
    12. Demir, Robert & Campopiano, Giovanna & Kruckenhauser, Christian & Bauer, Florian, 2021. "Strategic agility, internationalisation speed and international success — The role of coordination mechanisms and growth modes," Journal of International Management, Elsevier, vol. 27(1).
    13. Petrou, Andreas P. & Hadjielias, Elias & Thanos, Ioannis C. & Dimitratos, Pavlos, 2020. "Strategic decision-making processes, international environmental munificence and the accelerated internationalization of SMEs," International Business Review, Elsevier, vol. 29(5).
    14. Fletcher, Margaret & Harris, Simon & Richey, Robert Glenn, 2021. "Retrospective and prospective learning: Accelerating the internationalization process," Journal of World Business, Elsevier, vol. 56(3).
    15. Lin, Boqiang & Wang, Siquan, 2023. "The performance of specialized and oriented diversified firms: A comparative analysis from the targeted expansion of renewable energy business of listed companies," International Review of Financial Analysis, Elsevier, vol. 89(C).
    16. Xin, Yongrong & Khan, Rizwan Ullah & Dagar, Vishal & Qian, Fang, 2023. "Do international resources configure SMEs' sustainable performance in the digital era? Evidence from Pakistan," Resources Policy, Elsevier, vol. 80(C).
    17. Cheng, Cong & Zhong, Huihui & Cao, Liebing, 2020. "Facilitating speed of internationalization: The roles of business intelligence and organizational agility," Journal of Business Research, Elsevier, vol. 110(C), pages 95-103.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xu, Jiamin, 2025. "Does managerial myopia impede corporate internationalization?," International Review of Economics & Finance, Elsevier, vol. 103(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jiang, Yiyun & Wang, Xiufeng, 2024. "Digital transformation, innovation capability and speed of internationalization," Finance Research Letters, Elsevier, vol. 67(PA).
    2. Jose C. Casillas & Ana M. Moreno-Menéndez & Francisco J. Acedo & Encarnación Ramos-Hidalgo, 2025. "Speed of the internationalisation process. The role of objective vs. subjective perceptions of time," Journal of International Entrepreneurship, Springer, vol. 23(1), pages 166-195, March.
    3. Gyensare, Michael Asiedu & Miri, Domnan & Zahoor, Nadia & Alajaty, Mahmoud, 2024. "Aspiring to go abroad: How and when international entrepreneurial aspiration fuel emerging markets entrepreneurial ventures’ internationalisation speed," Journal of International Management, Elsevier, vol. 30(2).
    4. Gripsrud, Geir & Hunneman, Auke & Solberg, Carl Arthur, 2023. "Speed of internationalization of new ventures and survival in export markets," International Business Review, Elsevier, vol. 32(4).
    5. Purkayastha, Anish & Karna, Amit & Sharma, Sunil & Bhadra, Dhiman, 2024. "Role of resource investment management and strategic resource deployment capabilities in internationalization-performance relationship," Journal of International Management, Elsevier, vol. 30(2).
    6. Telma Mendes & Miguel González-Loureiro & Vítor Braga & Carina Silva, 2026. "Move fast and break things: Mapping the intellectual structure of the speed of the internationalization process to develop a research agenda for further inquiry," International Entrepreneurship and Management Journal, Springer, vol. 22(1), pages 1-40, March.
    7. Oleksiuk Adam & Pleśniak Agnieszka, 2022. "Environment Characteristics and Internationalization of SMEs: Insights from a Polish and Finnish Sample," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 30(3), pages 175-194, September.
    8. Appiah, Emmanuel Kusi & Gabrielsson, Peter & Rialp Criado, Alex, 2025. "The role of digitalization in early internationalization Research: A systematic literature review and future research directions," Journal of Business Research, Elsevier, vol. 186(C).
    9. Różański Jerzy & Lopez-Morales Jose Satsumi & Bogołębska Justyna, 2025. "Internationalisation and the Financial Performance of Companies," Folia Oeconomica Stetinensia, Sciendo, vol. 25(1), pages 259-274.
    10. Freixanet, Joan & Federo, Ryan, 2025. "A configurational analysis of internationalization, absorptive capacity, and resource-based factors explaining firms’ innovation performance," International Business Review, Elsevier, vol. 34(4).
    11. Jafari-Sadeghi, Vahid & Amoozad Mahdiraji, Hannan & Busso, Donatella & Yahiaoui, Dorra, 2022. "Towards agility in international high-tech SMEs: Exploring key drivers and main outcomes of dynamic capabilities," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    12. Fariborzi, Hadi & Osiyevskyy, Oleksiy & DaSilva, Carlos, 2022. "The effect of geographic scope on growth and growth variability of SMEs," Journal of World Business, Elsevier, vol. 57(5).
    13. Han, Xiaomin & Goxe, François & Freeman, Susan, 2024. "Internationalization through social networks: A systematic review and future research agenda," International Business Review, Elsevier, vol. 33(4).
    14. Yang, Hongyi & Stoian, Maria-Cristina, 2025. "Post-entry internationalization of born globals: The role of dynamic capabilities in accelerating growth," International Business Review, Elsevier, vol. 34(2).
    15. Deng, Ziliang & Zhu, Ziyan & Johanson, Martin & Hilmersson, Mikael, 2022. "Rapid internationalization and exit of exporters: The role of digital platforms," International Business Review, Elsevier, vol. 31(1).
    16. Pham Quang Huy & Vu Kien Phuc, 2024. "Contribution to accelerated internationalization with digital forensic accounting and metaverse circular business model innovation for Vietnam-based SMEs," Journal of Innovation and Entrepreneurship, Springer, vol. 13(1), pages 1-28, December.
    17. Vuorio, Anna & Torkkeli, Lasse, 2023. "Dynamic managerial capability portfolios in early internationalising firms," International Business Review, Elsevier, vol. 32(1).
    18. María Agustí & Olli Kuivalainen & Encarnación Ramos-Hidalgo & Francisco J. Acedo, 2023. "Maturing international new ventures: Short- and medium-term Insights," Journal of International Entrepreneurship, Springer, vol. 21(3), pages 329-353, September.
    19. Dura Codruta Cornelia & Ghicajanu Mihaela, 2025. "Overcoming Barriers To Sme Internationalization And Globalization: Insights From A Systematic Literature Review," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 5, pages 164-175, October.
    20. Demir, Robert & Campopiano, Giovanna & Kruckenhauser, Christian & Bauer, Florian, 2021. "Strategic agility, internationalisation speed and international success — The role of coordination mechanisms and growth modes," Journal of International Management, Elsevier, vol. 27(1).

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:69:y:2024:i:pb:s1544612324012765. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.