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2025 AOM Annual Meeting

IM

Session: 25925: IM Division IU-Kelley School of Business Best Paper in Corporate Social Responsibility and Sustainability Award

15015: Geopolitical Risk and Subsidiary Social Engagement (session 25925)

Monday, July 28, 2025
08:30 - 10:00 CEST (GMT+2)
Location: Bella Center: Hall B- B3-m5
Session Type: Paper Session
Orientation: Practice,International,Research
Shareable link: https://cdmcd.co/nR6xz4

    Author(s)

  • YC

    Yishu CAI

    Department of Management, Business School, The Chinese U. of Hong Kong,HK, Hong Kong

  • YL

    Ya Lin

    Chinese U. of Hong Kong, Hong Kong

  • HY

    Haibin Yang

    Chinese U. of Hong Kong, Hong Kong

  • YS

    Yuan SHUI

    The Hong Kong University of Science and Technology, Hong Kong

We delved into the challenge faced by multinational corporations (MNCs) amidst heightened geopolitical tensions, particularly during the US-China Trade War. While US MNCs are required to comply with US policies in the trade war, such compliance aggravates these firms’ market standing in the host country—China. We theorize that US subsidiaries may effectively use CSR activities in China to hedge again the political risks, and this tendency will be stronger when these MNCs are embedded in Chinese politics or when these MNCs have the board experience of connecting with non-profits organizations. Analyses of US subsidiaries in China in the context of trade war support our theses. We contribute to the existing literature by underscoring an alternative approach beyond traditional economic and political strategies, illustrating that social involvement is an essential strategy for MNCs to tackle geopolitical risks and sustain strategic adaptability.

view paper (if available)