120: De-Coupling, Divesting, De-Internationalization: The Role of Sanctions and Stakeholder Pressure (19258)

Friday, August 9, 2024

12:00 – 13:30 CT (GMT-5/UTC-5)

Location: Hyatt: Columbian

Session Number: 120
PDW (workshop)
Orientation: Practice,International,Research
Shareable link: https://cdmcd.co/JQJpyK

Organizer(s)

AS

Alexander Settles

U. of Florida, United States

Session Chair(s)

AG

Ajai Singh Gaur

Rutgers U., United States

Panelist(s)

LD

Luis Alfonso Dau

Northeastern U., United States

Discussant(s)

JV

Juha Väätänen

LUT U., School of Business and Management, Finland

Panelist(s)

YT

Yannick Thams

Florida Atlantic U., United States

Participant(s)

CH

Christopher Hartwell

ZHAW School of Management and Law

Panelist(s)

AJ

Andreja Jaklic

U. of Ljubljana
TM

Tymofiy Mylovanov

Kyiv School of Economics
NS

Nataliia Shapoval

Kyiv School of Economics

International pressure on states that divert from the established world order has increasingly been used to reshape state, firm, and individual behavior. The reaction of MNEs to government and stakeholder pressure to divest or de-internationalize is a phenomenon that has received limited attention in the IB literature (Meyer & Thein, 2014, Soule, et. al. 2014). Using sanctions, political pressure, and stakeholder pressure to modify state decisions and behavior has a long history of use in international relations and trade. There have been over 1300 identified sanctions imposed by governments (Syropoulos et al., 2023) since 1950. The effectiveness of sanctions in negatively affecting sanctioned firms is questionable (Gaur et al., 2023). However, firms have responded to these sanctioning actions by reorganizing their supply chains and restructuring their international holdings and ownership structures. Stakeholders have also pressured multinational firms to exit from states violating the international order. MNEs and their CEOs have recognized the pressure that stakeholders have played in applying pressure to exit Russia (Katsos et al., 2022), and there is evidence that the decision to exit Russia is connected to the political affiliations of the CEO (Thams & Dau, 2023). This PDW panel discussion aims to discuss the types of pressure placed on MNEs, including how sanctions and stakeholder pressure work to disrupt international business ties, how firms respond to these actions, and to review current research on this phenomenon. In so doing, the panel responds to the call for reexamining MNEs' role in the political response to international conflict.