Looking on the bright side! The role of socio-environmental incidents in positively shaping international businesses and industries

Abstract

Purpose: The number of socio-ecological incidents involving multinational enterprises (MNEs) is increasing. While there is growing research attention on the role of MNEs in being corporately responsible actors, less is known about how the aftermath of negative socio-ecological incidents can help shape (more) sustainable futures for such businesses and the industries that they exist within. This study aims to address the positive strategic implications for MNEs in the aftermath of well-known social and environmental incidents. Design/methodology/approach: Using institutional theory and drawing from three real-life case vignettes, the paper elaborates on the types and role of institutions for (re)gaining legitimacy in MNEs and industries implicated in socio-ecological incidents through the development of a conceptual model that elaborates on common features of institutional change. Findings: A new type of institutional pressure, social isomorphism, is revealed, which both strengthens and helps explain the more formalised coercive and normative institutional pressures as positive forces for change in the MNEs and industries implicated in negative socio-ecological incidents such as those described. Practical implications: The paper offers clear strategic advice for managers in MNEs implicated in negative socio-ecological incidents. Originality/value: The paper puts forward a conceptual model that presents some common features of institutional change (types, pathways and relationships) for the international business context in the aftermath of negative socio-ecological incidents. Its theoretical contribution regards putting forward the concept of social isomorphism for neo-institutional theory in international fields.