How multinational enterprise (MNEs) develop and leverage managerial and firm capabilities in response to climate change

Abstract

Using the lens of dynamic green capability, the research explores how MNEs respond to climate change from a strategic and an operational perspective by investigating how firms and managers interpret the exogenous phenomena of climate change, identifying the resources and capabilities they view as critical for strategy implementation, gauging the ways in which they harness these resources and capabilities for strategy execution and enquiring about the ways they build capacity for the continual renewal of capabilities. The role of ethical mechanisms and global connectedness, in the execution of dynamic green capabilities, were investigated. Organisational flexibility is also explored as a component of dynamic green capability. A qualitative research method was adopted and in-depth interviews were conducted with 19 risk, strategy and sustainability managers and executives working in (or with) MNEs. Findings supported extant IB literature on the climate change issue and provided additional insights into the climate change context in an emerging market and real-world examples of theorised drivers, process and activities that are antecedents to dynamic green capability