How financing and information drive international corporate entrepreneurs’ innovations

Journal of International Entrepreneurship - This research combines the literature on social entrepreneurship and international corporate entrepreneurship to determine the relevance financial...     

Independent directors’ human and social capital,firm internationalization and performance implications: An integrated agency-resource dependence view

Despite the importance of internationalization for many firms and the substantial roles of independent directors as monitors and resource providers in corporate strategic orientation, few, if any, studies have investigated how independent directors with human and social capital contribute to firm internationalization. Drawing upon agency and resource dependence theories, this study argues that independent directors with human and social capital provide firms with strategic advice and adequate resources for internationalization, thereby increasing firm willingness to internationalize. Using 173 Taiwanese electronics firms and a weighted linear fixed-effects regression approach, the results indicate that independent directors’ industry-specific experience, international experience and interlocking directorate ties are positively associated with internationalization and that an inverted-U relationship exists between independent directors’ tenure overlap and internationalization. One implication is that international firms may consider appointing independent directors with human and social capital to the board because they will provide firms with resources necessary for successful internationalization.     

Beyond ‘know-what’ and ‘know-how’ to ‘know-who’: enhancing human capital with social capital in an Australian start-up accelerator

Abstract

This study investigates the enhancement of human capital with social capital in a start-up accelerator and how this integration affects the entrepreneurial learning experience. In particular, it examines the relative importance of the three components ‘know-what’, ‘know-how’ and ‘know-who’. The study involved thematic analysis of semi-structured interviews with participants in an Australian start-up accelerator that is delivered using ideas such as Design Thinking, the Business Model Canvas and Lean Start-up methodology. We find that although the programme emphasised ‘know-what’ and ‘know-how’, ‘know-who’ was most significant for participant learning. The results indicate that mentors and experts were especially helpful in shaping learning and in developing entrepreneurial networks. Moreover, our results show that the processes of ‘know-what’, ‘know-how’ and ‘know-who’ are interrelated – by knowing ‘who’, participants learnt ‘what’ and ‘how to’ through social learning. The research contributes to entrepreneurial learning theory and application particularly in the Asia Pacific context, by providing evidence that ‘know-who’ closes the learning loop for ‘know-what’ and ‘know-how’ as ‘know-who’ can actually provide entrepreneurs with the means to enhance their entrepreneurial self-efficacy.     

The significance of human capital and social capital: professional–client relationships in the Asia Pacific

Professionals working in professional service firms rely on their human capital and social capital to deliver value in their service provision and delivery to clients. However, research to-date is limited regarding investigations into the relationship between human capital and social capital at the level of professional–client relationships, particularly in the context of the Asia Pacific where changes in business environment, professional jurisdiction and ways of working have been commonplace for many firms operating in this region. In this study of Australian corporate law firms and client organizations, our results reveal significant evidence of relationships between social capital and human capital in the form of knowledge acquisition, where social capital facilitates professionals’ capacity to acquire knowledge from clients and increases the overall amount of knowledge acquired. More research on social capital and knowledge acquisition has the potential to advance our understanding of the influence of professional–client relationships on human capital development in the Asia Pacific.     

Globalization,technical change and the skill premium: magnification effects from human – capital investments

This paper shows that endogenous adjustments in the composition of labour supplies magnify the effects of changes in commodity prices on the measured skill premium under quite plausible conditions. These composition effects arise from decisions of individuals with heterogeneous inherent abilities about acquiring human capital. They reinforce the well-known Stolper?–?Samuelson effect on the measured skill premium in countries with a sufficiently high relative supply of skilled labour, but compensate them otherwise. As a result, the model can account for the observation of a worldwide increase in the skill premium during the last two decades.     

The effect of human capital, social capital, and perceptual values on nascent entrepreneurs�� export intentions

This study investigates the influence of human capital, social capital, and cognition on nascent entrepreneurs' export intentions. The results indicate that while human capital and social capital influence the level of intended export, cognitive characteristics, such as self-efficacy and risk aversion, do not seem to influence entrepreneurs' intended level of export. The study makes three original contributions to international entrepreneurship research. The first one is the focus on “Real” Born Globals, i.e. entrepreneurs who express export intentions in the prefounding phase. The second is the focus on the individual-level factors rather than firm-level factors that explain export. Finally, the effect of experience is investigated from a path-dependency perspective rather than a “the-more-the-better” perspective. Our study suggests that it may be productive for researchers to look further into the concept of intention, as entrepreneurs' decision to internationalize presupposes a conscious intention of carrying out the action. Thus, the factors influencing the decision to internationalize may have been present prior to the founding of the venture.     

Unfolding China’s state-owned corporate empires and mitigating agency hazards: Effects of foreign investments and innovativeness

Integrating agency and institutional perspectives, we describe how China’s socio-political institutions create state-owned corporate empires with unique agency conflicts. We develop a framework demonstrating how economically unjustified firm expansion, i.e. empire building, mediates the relationship between state ownership and performance. We uncover the instrument in empire building and appropriate corporate governance and strategic management remedies. An empirical study on 29,638 Chinese firms evidences that (1) increased state ownership drives higher management expenses and lower firm profitability though empire building; (2) long-term debt is used to finance empire building; and (3) foreign capital investments and innovativeness can mitigate these agency conflicts.     

Sustainability assurance and cost of capital: Does assurance impact on credibility of corporate social responsibility information?

This paper aims to examine the credibility value of sustainability assurance and the type of assurance provider on cost of capital. A large sample of international companies from the period 2007–2014 was used to develop our models of analysis. We find a greater decrease in cost of capital for companies that publish and assure their social and environmental reports. Thus, voluntary sustainability disclosures decrease the cost of capital. However, companies also have the opportunity to reinforce this decrease by providing an assurance statement, so increasing the credibility of corporate social responsibility information. In addition, the decrease in the cost of capital is significantly higher when such assurance is provided by a top‐tier accountancy firm instead of by engineering or consultancy firms; this result supports also the reputational capital of accountancy firms.     

Founders’ human capital and the performance of UK new technology based firms

This paper investigates the role of entrepreneurs?? general and specific human capital on the performance of UK new technology based firms using a resource based approach to the entrepreneurship theory. The effect of entrepreneurial human capital on the performance of NTBFs is investigated using data derived from a survey of 412 firms operating in both high-tech manufacturing and the services sectors. According to the resource based theory it is found that specific human capital is more important for the performance of NTBFs in relation to general. More specifically individual entrepreneurs or entrepreneurial teams with high levels of formal business education, commercial, managerial or same sector experience are found to have created better performing NTBFs. Finally it is found that the performance of a NTBF can improve through the combination of heterogeneous but complementary skills, including, for example, technical education and commercial experience or managerial technical and managerial commercial experience.     

What determines success? examining the human,financial, and social capital of jamaican microentrepreneurs

This research examines the performance of 215 informal microenterprises in Jamaica, studying the influence of human capital, social capital, and financial capital of the owners on their business profitability. Understanding the importance of particular relationships that result in successful micro-businesses is important for a number of reasons. First, among many developing countries, the growth of microenterprise provides the most visibly vibrant and growing economic activity. Although considerable effort and resources are being directed toward microenterprise promotion schemes, empirical research on the subject is quite limited. Second, economies in developing countries mirror many of the social and institutional problems existent in urban economically disadvantaged areas of the United States and other developed countries. For these areas, microenterprise may be an essential component of urban renewal and community development. This study helps in identifying important characteristics of social and individual attributes that may be relevant to those attempting to strengthen this subsector. Finally, this study seeks to provide insight into a dimension of microbusiness research for which there are limited data, specifically, the role that social capital plays among practicing entrepreneurs and owners.This research found that different structural environments, even within a singular and small economy, may considerably alter the rates of return to human, social, and financial capital. As a result, the analysis of enterprises includes segmentation according to both the usage, or not, of employees, and the sophistication of the technologies used.Several factors were determined to enhance the profitability of the businesses in all categories. Vocational training, for example, demonstrated consistently strong and positive effects. Mother’s high occupational status (a proxy for socioeconomic status) and years of experience in the business were also consistently positive and strongly associated with increasing profits.Although additional starting capital played an important role for both the businesses with and without employees, increasing amounts failed to differentiate the success of those firms that were already operating in the higher technological tier. Obtaining a small business loan acted in a similar manner, enhancing the profitability of all firms, except those segmented into a high technological tier. One interpretation of this finding is that the role of technological choice is extremely important, and appears to dwarf that of varying amounts of starting capital.Social capital, as operationalized by frequent church attendance and marital status of the owner, was found generally to increase the profitability of the business. The data demonstrate that social networks play an important role in the success of these businesses, and that conditions in the highest tier utilize social capital in a somewhat unique manner.     

How and why auditors’ social exchange relationships influence their attitudes and behaviors: Implications for audit quality

External auditors regularly interact with various parties at work, such as their accounting firms, engagement team members, and clients. These interactions can help shape the nature of auditors’ social exchange relationships with these entities, which in turn may influence their behavior toward these targets. This installment of Accounting Matters draws from recently published research by Herda and colleagues to (1) explain how constructive auditor-target connections can develop and lead to beneficial outcomes like reduced auditor burnout and turnover intentions, as well as more citizenship behavior, and (2) discuss how these upshots might ultimately affect audit quality. This topic is important because audit quality translates into improved financial reporting, which helps stakeholders who rely on audited financial statements to make informed business decisions. Specifically, we underscore the key role auditors’ perceptions of fair treatment from a relationship partner play in fostering a strong psychological bond with the target via perceived support. We further consider how auditors’ consequent commitment to the target can result in favorable organizational outcomes, including enhanced audit and financial reporting quality. We also discuss practical implications for accounting firms.     

Disruptive innovation and the creation of social capital in Indonesia’s urban communities

Abstract

Existing research on social capital has primarily focused on examining the outcomes of social capital, whether these are about individual, organizational or even societal outcomes. However, much research is still needed in terms of examining how social capital is created. We contribute to filling this gap by examining the ways in which social capital is created in urban communities in an emerging economy. Social capital, in this study, is viewed as being created as a consequence of an organization’s disruptive innovation. We analyse the context of Go-Jek, a rather newly established service firm in Indonesia, and examine how the disruptive innovation of Go-Jek’s service provision influences the creation of social capital in terms of social connectedness, trust, and shared understanding, in Indonesia’s urban communities.     

Advancing transcendent development: An in-depth review of developmental corporate social responsibility’s value proposition,inhibitions, and inclusive sustainable development prospects

This article offers a methodologically innovative Representative Literature Review of 260 Development-Oriented Corporate Social Responsibility publications explicating why the nascent domain’s early momentum has seemingly stagnated. Using mixed-methodological citation network analysis informed by Applied Thematic Analysis research design principles, this in-depth literature review unearths a causal set of Impediments, leading to Inhibitors restraining Developmental Corporate Social Responsibility’s inclusive sustainable developmental potential. The Seven Impediments and their Seven Inhibitors are ultimately meta-thematically synthesized into the following Three Inhibitions presently stifling the field: “(I) Ignorance,” “(II) Isomorphism,” and “(III) Inharmony.” Resultantly, this article offers three contributions for addressing these Inhibitions. First, academic scholarship is offered knowledge of how “(I) Ignorance” may be curbed by producing research that retains and builds upon knowledge cumulatively, instead of losing it to fragmentary dissipation born of scholarly incoherence. Second, institutional policymakers are offered pathways for transcending superficial “(II) Isomorphism” by enforcing regulation that engenders ethical business conduct by filling critical institutional voids in developing context jurisdictions. Finally, this review outlines how the Inhibition of “(III) Inharmony” may be pragmatically transcended by harmonizing unconscious ontological dissonance through self-awareness and reflexive virtue development by synergistically enacting individual Moral Courage, Moral Tact, and Moral Imagination tempered by African Vhuthu/Ubuntu.     

The entrepreneur’s mode of entry: the effect of social and financial capital

This article uses a French database of firms set up in 1998 to investigate the determinants of takeovers versus startups as a mode of entry. It focuses on two determinants that previous research has not fully analyzed: social capital and financial capital. Our findings suggest social capital affects the mode of entry. They show that entrepreneurs with social capital are more likely to create new firms from scratch than to take over existing firms. We confirm the effect of financial capital on the mode of entry. Bank loans are more often associated with takeovers than with startups and low initial wealth is more often associated with startups than with takeovers. These results show that finance affects the mode of entry.     

Consumers’ forgiveness after brand transgression: the effect of the firm’s corporate social responsibility and response

Abstract

In this article we examine the interplay between the severity of a brand transgression, consumers’ prior awareness of the firm’s corporate social responsibility (CSR) initiatives, and the firm’s response (apology vs. apologia) on the rates of forgiveness among consumers. Results of two experiments show that consumers’ prior awareness of the firm’s CSR initiatives significantly differentiates apologia from apology, with the effect of apology on consumer forgiveness being more apparent when brand transgression severity is mild. Results also show that consumer forgiveness mediates the effect of brand transgression severity, firm response, and consumer awareness on repurchase intentions. In this way, the study enables managers to determine whether or not an apology or apologia will be sufficient to solicit consumer forgiveness, using information about the levels of awareness of CSR among consumers.     

Web 2.0, social capital and work performance in service companies: the employees’ view

Web 2.0 networks have provoked a revolution in the last years due to their capacity to modify human relationships, particularly in business contexts. Social capital, as a crucial intangible asset embedded in Web 2.0 networks, can be extremely helpful to build and optimize personal and organizational power or resources. This exploratory study empirically analyzes the use of Web 2.0 networks for work-related purposes under a new perspective: the perception of Spanish service companies’ employees. Results show a reasonable employee use of Web 2.0 applications with work-related purposes, and identify the main benefits from them and relevant differences in their use.     

How ‘social’ are social media? A cross-cultural comparison of online and offline purchase decision influences

Traditional word of mouth (WOM) involves personal communications among family, friends, and others. Today, social media sites like Facebook offer the possibility of electronic word of mouth (eWOM), a mediated form of WOM. Little is known about the best way for marketers to use social media. Even less is known about international differences in consumer usage of social media and how eWOM influences consumer decision-making. This study helps address that research gap and uses cultural dimensions to compare the use of social media and other information sources for consumer decision-making across 50 countries. The results indicate that the use of information sources that influence online purchase decisions strongly varies by culture. For example, relationship-oriented collectivists rely to a greater extent than individualists on social media, which are an alternative for interpersonal WOM communication. Interestingly culture affects the influence of social media on purchases differently than the influence of traditional WOM through family or friends. Furthermore, there are major differences in online complaint behavior by country, due to cultural variations.     

Consumers’ implicit attitudes toward corporate social responsibility and corporate abilities: Examining the influence of bank governance using the implicit association test

In studying corporate association valence for two dimensions: corporate social responsibility (CSR) and corporate abilities (CA), this paper aims to investigate how corporate governance may contribute to brand equity. Using an experimental design, this research measures implicit consumers attitudes with two implicit association tests (IAT) to assess the potential moderating effect of banks governance. In study 1, we manipulated solidarity vs. non-solidarity concept (major meaning associated with CSR) by mobilizing 116 respondents. In study 2, we manipulated performance vs. non-performance concept (major meaning associated with CA) by mobilizing 96 respondents. Results reveal that the CSR association is more positive for member-owned banks than for investor-owned banks. Conversely, the CA association is more positive for investor-owned banks than for member-owned banks. These results emphasize the role of governance in building brand equity through its impact on the valence of the brand associations.     

How can leaders of multinational organizations be ethical by contributing to corporate social responsibility initiatives? Guidelines and pitfalls for leaders trying to do good

Corporate social responsibility (CSR) is a laudable goal for multinational enterprises (MNEs) because of the significant positive impact they can bring to the society and environment around the world. However, there are significant challenges to the practice of CSR in MNEs. This article discusses two major barriers to CSR that are especially significant for MNEs: leaders’ attitudes and cultural variance. We then apply insights from Rest’s ethical decision-making and cross-cultural research to offer guidance to leaders of MNEs to implement CSR in their organizations. We present a multistep process by which leaders first reflect on and clarify what goals they want to accomplish in the realm of CSR and then how to build consensus for those goals and modify them to incorporate the values and beliefs of local constituents.