Dear friends and colleagues,
The GSJ special issue on Ownership and Global Strategy, co-edited by Alvaro Cuervo-Cazurra, Anna Grosman, Michael Mol, and Geoffrey Wood, is out (see https://onlinelibrary.wiley.com/toc/20425805/2025/15/1). The guest editors’ introduction outlines the field, discussing the diversity in owners and their non-financial objectives and explaining the contributions of the papers.
Each paper provides an insightful analysis of a dimension of this relationship. Harald Kollmann, Jakob Müllner, and Jonas Puck explain how venture capital firms expand abroad. Dennis Wajda, Juan Bu, and Wei Shi study the role of foreign institutional investors in cross-border acquisitions. Philip Steinberg, Jan Hennig, Jana Oehmichen, and Judith Heigermoser examine the impact of institutional investors on global competition. Cheng Li and Klaus Meyer investigate the role of state ownership in cross-border acquisitions. Thomas Lindner, Jakob Müllner, and Harald Puhr discuss the impact of ownership and debt structure on cross-border acquisitions. Finally, Douglas Cumming and Ahmed Sewaid study how foreign investors’ culture affects the crowdfunding of entrepreneurs.
Many of the papers are open access, allowing you to retrieve them by clicking on their titles.
We hope that you find this collection useful for your research!
Warm wishes,
Alvaro, Anna, Geoff, and Michael
The impact of ownership on global strategy: Owner diversity and non-financial objectives
Alvaro Cuervo-Cazurra, Anna Grosman, Michael J. Mol, Geoffrey Wood
In this special issue introduction, we analyze how a firm's ownership affects its global strategy. We reinterpret the literature by grouping dominant owners into four categories: (1) individuals (entrepreneurs and families), (2) labor (managers and employees), (3) state (national and subnational governments), and (4) institutions (pension funds, mutual funds, hedge funds, private equity, venture capital, and impact investors). We argue that although all seek financial returns from their investments, they differ markedly in their non-financial objectives, resulting in differences in strategies for expanding abroad. We also propose that the home country context modifies the impact of ownership on global strategy, directly by influencing the prevalence of owner types, and indirectly by affecting owners' incentives and constraints in their pursuit of non-financial objectives.
Pioneering excellence or fleeing mediocracy? Why venture capital firms internationalize
Harald Kollmann, Jakob Müllner, Jonas Puck
Theories and empirical evidence on the competitive motives for VC internationalization are unclear and contradictory. In our study, we adopt a performance feedback perspective to explain VC firms' motives to venture abroad. We leverage unique peer-performance data on 295 VC funds and 2954 VC investments and find support for our hypotheses that performance below (a) peer, (b) historical, or (c) market aspiration levels drives VCs exodus to (a) foreign and (b) more distant markets. Our study complements theories on internationalization with an organization ecology perspective that acknowledges internationalization as an attempt at adaptation triggered by poor performance.
Foreign institutional investors and equity share decisions in cross-border mergers and acquisitions
Dennis Wajda, Juan Bu, Wei Shi
This study examines the role of foreign institutional investors in shaping acquiring firms' equity share decisions in cross-border mergers and acquisitions (M&As). We argue that foreign institutional ownership (FIO) from a given country is positively associated with the share of equity sought in the target firm in this country because foreign institutional investors can help reduce information asymmetry between the acquiring and target firms. Moreover, this positive relationship is stronger if target firms are in countries with weaker institutional development because acquiring firms suffer from higher information asymmetry and thus are more inclined to rely on foreign institutional investors for information. Findings from a sample of 4166 cross-border M&As by US firms lend support to our arguments.
Common ownership and competitive dissimilarity: A global perspective on competition and institutional ownership
Philip J. Steinberg, Jan C. Hennig, Jana Oehmichen, Judith Heigermoser
Research highlights that common institutional ownership (an investor owning publicly traded shares in two rival firms) can reduce rivals' incentives to compete. So far, this literature focused on domestic market competition. However, competition also arises in global markets, and common owners invest outside their home countries. We integrate the perspectives of global market competition and cross-national distance into a model of shared principals with rival agents and argue for a positive effect of common ownership on rivals' competitive dissimilarity in global markets. Moreover, we argue that the competitive intensity in joint regions amplifies, and the cross-national distance between common owners and their firms mitigates this effect. We find support for our theorizing using a multi-industry dataset with 1574 of the largest firms worldwide.
All politics starts local: Liability of stateness and subnational labor markets
Cheng Li, Klaus Meyer
State-controlled acquirers face a liability of stateness (LoS) because host country stakeholders consider them less legitimate and as representatives of foreign political power. We argue that due to LoS, state-owned enterprises (SOEs) face more regulatory scrutiny in cross-border acquisitions than comparable private-owned enterprises (POEs). Applying a voting behavior perspective, we further posit this increased regulatory scrutiny is reduced when acquisitions occur via intermediaries, and in host communities less averse to state ownership due to local labor conditions. Using a sample of cross-border acquisitions with acquirers from 44 economies and targets in 50 US states, we find that SOEs are 9% more likely to attract additional regulatory scrutiny than POEs. However, this likelihood decreases with indirect acquisitions and in host regions with high unemployment.
Ownership, institutions, and the agency of M&A completion
Thomas Lindner, Jakob Müllner, Harald Puhr
In this paper, we study how variations in debt and equity ownership and the institutions that govern interactions between different types of principals and agents affect the completion likelihood of acquisitions. Using a sample of 55,722 acquisitions, our study finds that risk-averse debtholders reduce the completion likelihood of acquisitions. When acquisitions cross borders, the acquiring capital providers become exposed to institutional environments that have evolved to prioritize different ideologies or principals because of the structure and customers of local capital markets. As a result, institutional duality in home and target countries reduces the completion likelihood of acquisitions. Our study integrates varieties of capitalism arguments and firm-level agency conflicts and highlights the theoretical importance of capital markets and their concentration.
Culture, international stakeholders, and crowdfunding
Douglas J. Cumming, Ahmed Sewaid
International crowdfunding platforms present a unique opportunity for foreign entrepreneurs to attract stakeholders, typically from either the entrepreneur's home-country or the platform's host-country. We argue that success in mobilizing these stakeholders is culturally dependent. Specifically, cultural distance from the platform's host country can impede the mobilizing of home-country stakeholders. Conversely, while attracting host-country stakeholders may appear advantageous, these benefits are uncertain and limited for culturally-proximal entrepreneurs. This is because their offerings are seen as less distinct compared to host-country local offerings while introducing additional information asymmetries. Given these dynamics, we theorize that culturally-distant entrepreneurs have better fundraising prospects when attracting host-country backers, while culturally-proximal entrepreneurs are more successful when mobilizing home-country backers. Our analysis of 55,266 foreign projects on Kickstarter supports these arguments.
Alvaro CUERVO-CAZURRA
CEM Chair of Global Sustainability and Professor of International Business and Strategy
Northeastern University, D’Amore-McKim School of Business, 360 Huntington Avenue, Boston MA 02115, USA
a.cuervocazurra@northeastern.edu
https://www.linkedin.com/in/alvarocuervocazurra/
www.cuervo-cazurra.com
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Alvaro CUERVO-CAZURRA
CEM Professor of Global Sustainability and Professor of International Business and Strategy
Northeastern University, D'Amore-McKim School of Business
360 Huntington Ave, Boston, MA, 02115, USA
a.cuervocazurra@northeastern.eduwww.cuervo-cazurra.com.------------------------------