Organizational Political Ideology, Host Country Institutions, and Impact on Employee Outcomes

Abstract

This chapters draws on the institutional perspective to suggest that in cross-border mergers and acquisitions (M&As), a (mis)alignment between the characteristics of the acquiring organization, (in particular, the acquirer-organization’s political ideology) and the institutional environment of the host country (employment regulations, in particular), has an effect on employee outcomes as a consequence of the M&A process. Prior research on cross-border M&As tends to adopt an overtly economic, or cultural, approach, to explain the outcomes of cross-border M&As. Research in corporate governance and other cognate fields, however, shows the fruitfulness of a multi-level processual lens to understand the impact of these deals on organizations. This conceptual chapter aims to extend this body of work by drawing on the role theory perspective to theorize how employees may be affected by cross-border M&As and illuminates the consequences of this mismatch at different levels of the organization.