Private, State-Owned or Hybrid? State-Owned Multinationals as Strategic Form of Corporate Ownership

According to recent research in International Business state-owned multinationals represent some of the world’s most active cross-border investors. This phenomenon is specific to emerging markets where governments support the internationalization of state-owned enterprises. In this manuscript, we answer the research question: How does state ownership affect the strategies and performance of multinationals? To answer the research question, an analysis of the 20 largest Chinese state-owned multinationals listed in the Fortune Global 500 has been employed. We use quantitative research methods to conclude that state ownership plays a crucial role in the Chinese state-owned multinationals’ cross-border strategies, especially under the project Belt and Road Initiative. We have identified a correlation between the active internationalization of Chinese state-owned enterprises and the implementation of the grandiose project Belt and Road Initiative. We argue that state-owned multinationals represent hybrid enterprises and can be considered a strategic form of corporate ownership. We contribute to internationalization theory by arguing that state-owned enterprises differ from private firms in their foreign entry modes and state-owned multinationals represent strategic entities to enter foreign markets. This research paper presents implications for practitioners and policymakers who are concerned about the corporate governance of state-owned enterprises from countries with a high concentration of state ownership, like China in particular.