Foreign divestments from Russia: An exploration of the mediating factors

• DOI: http://doi.org/10.1002/jsc.2208
• Published date: 01 July 2018
• Author: Tashauna Brown,Andrei Panibratov
• Date: 01 July 2018

RESEARCH ARTICLE

DOI: 10.1002/jsc.2208

Strategic Change. 2018;27(4):359–367. wileyonlinelibrary.com/journal/jsc © 2018 John Wiley & Sons, Ltd. 359

Abstract

orei]n diestment (D) decisions are not rurely based on the rroCtability o= a business but also

on a comranyĽs inesঞn] and diesঞn] ererience and the de]ree o= uncertainty in marhets. $he

D rrocedure is ]rounded by the leel o= uncertainty, ererience in diesঞn], and ererience in

inesঞn]. oth internal and eternal =actors are catalysts =or the CrmsĽ =orei]n diestments. $he

constructs o= real orঞons theory, rrosrect theory and the theory o= bounded raঞonality are three

hey moderators in the CrmsĽ D decisionŊmahin].

ƐՍ

|

Ս$!&$

In recent years because o= increased =orei]n direct inestment a[er

the Second World War, Foreign divestments (FD) has been gaining

momentum and becoming more widespread. Researchers over the

years have dedicated a lot o= ঞme and resources in a bid to underŊ

stand =oreign investment, however, FDs have received lile aenŊ

ঞon. FD occurs when a company: ceases to possess net compeঞঞve

advantage; no longer Cnds it proCtable to internalie its advantages;

and it is no longer proCtable to uঞlie its internalied net compeঞঞve

advantage abroad (oddewyn, 1983b). I= we go a step =urther and looh

at a CrmĽs FD decision it is apparent that very lile has been done to

provide insight into what inYuences the divestment types and modes,

which is just as important as the moঞves =or FD.

Researchers have argued that decisionŊmahing processes are

embedded in organiational contets and hence they are in=luŊ

enced not only by economic =actors but also by institutional speci=Ŋ

ics. As a result, the international business environment has become

more dynamic and many companies struggle in dealing with and

eecuting FD. It is against this bachdrop that we try to determine

the various theories that underlie and determine a =irmĽs FD deciŊ

sion and mode.

$here has been lile =ocus on divestment =rom emerging marhets

(Li & Liu, 2015; alih, 2003), especially =rom Russia; hence, this arঞcle

=ocuses on FD =rom Russia. Russia tends to be an etremely dynamic

and volaঞle marhet, with occasionally unpredictable outcomes =or

Cnancial insঞtuঞonsĽ development (ichailova, carthy, & u@er,

2013). With the recent poliঞcal ri[ between Russia and the West,

which only =urther eacerbates this volaঞlity o= the Russian marhet

and incenঞvies western companies to withdraw and divest =rom the

Russian marhet, studies set in this contet are even more compelling

and may provide valuable insights into this problem. Other studies that

=ocus on emerging marhets mostly use the more abundant evidence

=rom India and hina and are o[en thought o= as tuintessenঞal to the

study o= emerging marhets. We believe that this may not be the case,

and that all three o= the biggest emerging marhets (hina, India, and

Russia) have considerable contetual di@erences and any aempts to

generalie and analye phenomena in any o= them through the prism

o= the research results =rom the other two are dubious at best. $hereŊ

=ore, we aim to contribute to the understanding o= these disঞncঞons

by increasing the body o= hnowledge on the least researched contet

o= the threeŌthe Russian one. $he research is, there=ore, oriented to

clari=y which theories best eplain the =actors that mediate a FD deciŊ

sion and determine a type o= FD, and to what etent a combinaঞon o=

theories is use=ul.

Our contribuঞon to the literature is two=old. First, we address the

neglected area o= FD strategies and decisions, providing a theoreঞcal

basis =or the development o= a holisঞc theory. Second, we eplore the

driving =actors and pillars o= divestment decisions and CrmsĽ strateŊ

gies through the insight =rom management and organiaঞonal theoŊ

ries, substanঞated by pracঞcal illustraঞons o= =oreign mulঞnaঞonals

in emerging marhets, with the =ocus on the Russian marhet. $hird,

we Cll the eisঞng hnowledge gap in the =orces that condiঞon s

to divest =rom emerging economies and we provide the integrated

or;b]m 7b;stl;mts =rol !ssbaĹ Am ;rѴoraঞom

o= t_; l;7baঞm] =actorsŖ

Andrei PanibratovՊ|Պ$as_ana ron

raduate School o= anagement,

SaintŊetersburg State &niversity, Russia

orresrondence

Andrei anibratov, raduate School o=

anagement, SaintŊetersburg State

&niversity, (olhhovshy Lane 3, Saint

etersburg 199004, Russia

mail: panibratovŠgsom.pu.ru.

* J..L. lassiCcaঞon codes: F21, F23

Strategic Change. 2018;27(4):359–367. wileyonlinelibrary.com/journal/jsc © 2018 John Wiley & Sons, Ltd. 359