Making great minds think alike: Emerging market multinational firms’ leadership effects on targets’ employee psychological safety after cross-border mergers and acquisitions

Rao-Nicholson, Rekha; Khan, Zaheer; Stokes, Peter

Abstract

© 2015 Elsevier Ltd This paper examines the impact of leadership on targets’ employee psychological safety (EPS), characterized by employees’ expectation of job and remuneration stability, during the cross-border mergers and acquisitions (M&As) by emerging market multinational companies (EMNEs). The M&As by Indian and Chinese companies forms the empirical context of this study and the case survey method is used to examine the effect of leadership on EPS. The results show that the EMNEs’ leadership visibility during the M&A process has no impact on the EPS, whereas, the trust in the EMNEs’ leadership has positive effect on the EPS. The deal status has a moderating effect on the leadership visibility and positively affects the EPS. This research finds evidence of target country differences in terms of the effect of EMNEs’ leadership on EPS and limited evidence of such effect for acquirer nationality differences.

• Journal Article Type: Article
• Acceptance Date: Sep 21, 2015
• Publication Date: Feb 1, 2016
• Journal: International Business Review
• Print ISSN: 0969-5931
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 25
• Issue: 1
• Pages: 103-113
• DOI: https://doi.org/10.1016/j.ibusrev.2015.09.007
• Keywords: employee psychological safety, leadership, emerging market multinational firms, M&As, India, China
• Public URL: https://uwe-repository.worktribe.com/output/914164
• Publisher URL: http://dx.doi.org/10.1016/j.ibusrev.2015.09.007