Abstract
This paper explores how acquiring firms from emerging markets can mitigate political-risk concerns from host countries in Cross-Border Mergers & Acquisitions (CBM&As) deals by leveraging their Environmental, Social, and Governance (ESG) practices. Utilizing data from Chinese CBM&As activities from 2010 to 2018, we find that while relative political risk concerns deter deal completion rate, higher ESG standards of acquirer firms reduce this deterrence effect. The results remain robust to considering ‘duration of deal completion’ as an alternative variable and when splitting the target sample countries into developed and emerging economies. The key conclusion is that emerging market multinational companies can effectively employ ESG as a strategic tool for internationalisation, enabling them to overcome some of the inherent ‘liabilities of origin’.
| Original language | English |
|---|---|
| Pages (from-to) | 146-155 |
| Number of pages | 10 |
| Journal | Economics and Business Letters |
| Volume | 14 |
| Issue number | 3 |
| Early online date | 23 Jun 2025 |
| DOIs | |
| Publication status | Published - Sept 2025 |
Bibliographical note
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Keywords
- Mergers & acquisitions; Deal completion; Political risk; ESG
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