Open AccessBalancing social and political strategies in emerging markets: Evidence from India
Author(s) -
RaoNicholson Rekha,
Khan Zaheer,
Marinova Svetla
Publication year - 2019
Publication title -
business ethics: a european review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.343
H-Index - 35
eISSN - 1467-8608
pISSN - 0962-8770
DOI - 10.1111/beer.12206
Subject(s) - polity , politics , context (archaeology) , emerging markets , business , economics , industrial organization , economic system , market economy , public economics , political science , finance , paleontology , biology , law
This article explores the substitution and complementary effects between political and social strategies on firm performance in the context of an emerging market (EM). Using in‐depth, historical case‐study approach, the article investigates how companies integrate political and social resources in this market. Corporate performance includes traditional measures, such as accounting performance and nonfinancial measures like the ease of doing business. The study finds that social strategies are stronger enablers of firm long‐term performance than political strategies. The latter have a short‐term impact on performance, but their success over time is limited. The main drawback of reliance on political resources in EMs is the lack of political stability, fragmented polity, and weak political coalitions. We identify rather limited evidence of firms using these two strategies as complements. Thus, we suggest that firms should employ both these strategies in the EM.