Entering the new century, foreign Fortune 500 companies in China and Russia joined a growing number of public crises of the various social and environmental issues. The public crisis refers to an unexpected, non-routine, and media event in which actors exposed concerned (eg, community members, employees, customers) allegation that a major threat to their interests. Although many of these crises involved the misdeeds of multinational corporations (MNCs), which … Read more »

Entering the new century, foreign Fortune 500 companies in China and Russia joined a growing number of public crises of the various social and environmental issues. The public crisis refers to an unexpected, non-routine, and media event in which actors exposed concerned (eg, community members, employees, customers) allegation that a major threat to their interests. Although many of these crises involved the misdeeds of multinational corporations (MNCs), the story is about him villains. Instead, there are contextual challenges in the social, political and market conditions of China and Russia, the roots irrespective of the occurrence of the crimes MNC go public crisis. Given the institutional change and stakeholder growth in these countries, it is increasingly important for multinational companies to understand and effectively deal with these challenges. This article provides insights into multinational companies and researchers in three ways. First, the article shows the pattern of MNC crises in the two countries from 2000 to 2011 and shows the differences between the two countries. Second, the article identifies four types of contextual challenges, including the global-national challenge, the challenge of social trust, the institutional-cavities challenge, and the normalized-crime challenge. Finally, the article discusses the impact of people management challenges and recommends addressing strategies.
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Meng Zhao
Source: Business Horizons
11 pages.
Release Date: 15, July 2013. Prod #: BH547-PDF-ENG
Beyond Cops and robbers: The contextual challenge driving the multinational public crisis in China and Russia HBR case solution

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