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In CEOs we trust: When religion matters in cross-border acquisitions. The case of a multifaith country

Author

Listed:
  • Diana W. P. Kwok

    (Humanis - Hommes et management en société / Humans and management in society - UNISTRA - Université de Strasbourg)

  • Pierre-Xavier Meschi

    (CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon)

  • Olivier Bertrand

    (Brazilian School of Public and Business Administration [Rio de Janeiro])

Abstract

This paper examines the emergence of trust by multifaith target-firm personnel in foreign acquirer CEOs during early post-acquisition integration, a decisive period for acquisition success, yet considerably under-researched. Combining self-categorization and similarity-attraction theories, we argue that religious similarity with the foreign acquirer's CEO represents shared values to the personnel, from which trust in the CEO arises. Further, we scrutinize the moderating effects of the personnel's religiosity and prior alliance success between the acquirer and target firm. We test our model using field-experimental data from 411 multifaith Malaysian personnel. The findings show that personnel-leader trust occurs more readily with religious similarity than religious dissimilarity, and that the personnel's religiosity strengthens this relationship. However, a successful prior alliance does not weaken the religious similarity–trust relationship. Our research encourages acquisition managers to consider religion, a factor beyond the traditional acquisition playbook, as a trust antecedent during early post-acquisition integration.

Suggested Citation

  • Diana W. P. Kwok & Pierre-Xavier Meschi & Olivier Bertrand, 2020. "In CEOs we trust: When religion matters in cross-border acquisitions. The case of a multifaith country," Post-Print hal-02881679, HAL.
    • Handle: RePEc:hal:journl:hal-02881679
    DOI: 10.1016/j.ibusrev.2020.101705
    Note: View the original document on HAL open archive server: https://hal.science/hal-02881679
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    Cited by:

    1. Zilja, Flladina & Benito, Gabriel R.G. & Boustanifar, Hamid & Zhang, Dan, 2023. "CEO wealth and cross-border acquisitions by SMEs," International Business Review, Elsevier, vol. 32(6).
    2. Younis, Heba & Dimitratos, Pavlos & Elbanna, Said, 2022. "International entrepreneurial SMEs in the muslim world: The role of religion in the GCC countries," International Business Review, Elsevier, vol. 31(5).
    3. Wafa Tariq Waqar & Yan Ma, 2024. "Acquirers’ corporate governance ratings and the likelihood of deal completion: Do stakeholders care about the agency hazards of European cross-border acquirers?," Review of Managerial Science, Springer, vol. 18(10), pages 2815-2848, October.
    4. Tim Heubeck, 2024. "Untangling the Paradoxical Relationship Between Religion and Business: A Systematic Literature Review of Chief Executive Officer (CEO) Religiosity Research," Journal of Business Ethics, Springer, vol. 195(1), pages 191-214, November.
    5. Juan Bu & Yinuo Tang & Yadong Luo & Chengguang Li, 2023. "Learning from inbound foreign acquisitions for outbound expansion by emerging market MNEs," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 54(5), pages 852-886, July.

    More about this item

    Keywords

    Cross-border acquisitions; Interpersonal trust; Religion; Malaysia; Multifaith employee; Experimental methods;
    All these keywords.

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