Parent Subsidiary Relationship of EM MNCs: The Chinese Experience

This paper intends to fill the gap on researching parent subsidiary relationship of multinational corporations (MNCs) by applying the current literature to MNCs from emerging markets (EM MNCs). By deploying a qualitative approach and using data collected from a dozen fieldtrips during 2005 and 2010 in various countries, this paper demonstrates that EM MNCs are making considerable efforts to improve their parent subsidiary relationships, which has profound impact on their overseas success. It indicates that extant theory on parent subsidiary relations could be largely extended to EM MNCs, but some amendments are essential, including the mutual resource support between parent and subsidiaries and the more hierarchic organisational structure of EM MNCs. The paper’s originality and value lies in the fact that this is the first attempt to examine parent subsidiary links based on cases of EM MNCs. This is also the first attempt to examine Chinese MECs in an organisational and managerial perspective.