Why do some multinational corporations relocate their headquarters overseas?
Article first published online: 23 MAY 2006
Copyright © 2006 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 27, Issue 7, pages 681–700, July 2006
How to Cite
Birkinshaw, J., Braunerhjelm, P., Holm, U. and Terjesen, S. (2006), Why do some multinational corporations relocate their headquarters overseas?. Strat. Mgmt. J., 27: 681–700. doi: 10.1002/smj.541
- Issue published online: 23 MAY 2006
- Article first published online: 23 MAY 2006
- Manuscript Revised: 22 DEC 2005
- Manuscript Received: 17 MAR 2003
- multinational corporation;
- corporate strategy;
This paper examines the decision by a multinational corporation (MNC) to relocate its business unit and/or corporate HQ overseas. We argue that business unit HQs move overseas in response to changes in the internal configuration of their unit's activities and the demands of the product markets in which they operate, whereas corporate HQs move overseas in response to the demands of external stakeholders, in particular global financial markets and shareholders. Using data on 125 business unit HQs and 35 corporate HQs, we test and find support for these arguments. The research highlights important differences between corporate- and business-level strategy, and it suggests ways in which the theory of the MNC needs to be reconsidered. Copyright © 2006 John Wiley & Sons, Ltd.