A Tale of Two MNEs: How Institutions Shape Two Pharma Firms' Interactions with Local Organizations

Many governments seek to attract high-quality inward foreign direct investment (iFDI) to promote firm capabilities, economic development and societal outcomes. Despite extensive research on the links between iFDI and socio-economic outcomes, there is only limited attention accorded to the quality of that investment; the research that does often adopts a quantitative, ‘large n’ approach, rather than assessing and comparing how individual MNEs contribute to the host country. Drawing on comparative institutionalism, we explore how the nature of two MNEs, one from Denmark and the other the UK, influences the quality of their FDI in one least-developed economy, Bangladesh. We assess how country-of-origin macro-level institutions influence not just the constitution of our focal firms and their organizational choices, but also 1) how MNEs interact with local organizations, and 2) what makes for ‘denser’ ties between firms and other players. The study highlights how a seemingly remote institutional plane (societal wide in the country of origin) influences and embeds practices at a micro level in a geographically distant host country.