International Business at TSE

The current global events from environmental crisis, challenges of free trade, and digitalization to the Covid-19 pandemic, Russia’s invasion in Ukraine, and USA’s announced government support for green transition for domestic businesses have brought trade policy as one of the core themes in news and public discussion. Particularly the firstly mentioned longer-term developments have generated an emerging theme in international business studies, encouraging scholars to further explore the interconnections of international business and policymaking. This trend has been strengthened by the more disruptive and sudden events. For example, the leading journal in international business research, Journal of International Business Studies, has established a sister journal in 2018, Journal of International Business Policy, which aims to advance the contributions that international business research could make for policy development. Thus, extending this line of work, we have published an edited book titled Global Trade and Trade Governance During De-Globalization: Transforming Trade Policy for Not-So-United World. The book was written in international collaboration and edited as a part of a three-year KAPPAS project funded by TT-säätiö (www.utu.fi/kappas). Besides this contribution, the project (2020–2022) has advanced trade policy expertise in Finland particularly though public business-oriented seminars and the establishment of new trade policy education in Turku School of Economics at the University of Turku.

Based on this emerging call for understanding international business phenomena in relation to international and global geoeconomic and (trade) policy developments, our book takes a fresh and much needed perspective on the challenges of trade policy by exploring the past, present and possible futures for trade policy development. First, looking back in time, the book discusses how we got amidst the current challenges. Second, the book discusses the current global scale challenges on trade policy, and third, exploring the possible future developments of trade policy. Thus, this book goes beyond merely describing disruptions, but also builds images of the futures of trade policy. Furthermore, by taking the perspective of international business studies, the book does not only focus on the economic, policy or legislative perspectives, but views trade policy as a part of society and international business environment. Therefore, it constitutes an interesting read for international business researchers as well as businesses and policy makers.

The first part of the book provides the basis for understanding the prerequisites of open trade and multilateral agreements, allowing us to understand how those objectives were originally pursued and how the conditions gradually changed to support the emergence of protectionism. The widening scope of research in the intersection of trade policy and international business has been developing hand in hand with the values driving trade policy in our societies from enhancing free trade to defending human rights, sustainability change, and democracy. It is evident that the protectionist policies and free trade supporting policies emerge in different circumstances. The role of clear hegemonic power in global economic development is crucial, and changes in these power games challenge our prevailing global trade policy structures. Thus, the first part highlights the complexity of change in global governance structures and their interconnection to the developments of ways of doing business.

The second part of the book focuses on current challenges. These challenges include global level structural challenges of the WTO at the heart of the developments of global trade and international relations, the increase of multidimensional RTAs and their role in decreasing current lock-in situations as everything would not have to be widely and unanimously agreed, and the changes driven by GVCs requiring systemic redesign to meet the new global trade reality. Challenges at the regional and national levels include the increased tensions and economic power competition between the USA and China, the negotiations of Great Britain’s divorce from the EU bringing similar tensions within Europe, as well as the perspective from smaller economies that are increasingly forced to take sides and find their ways through crises in different ways.

The third part of our book explores the emerging new future of trade policy. While values and trade policy objectives may be increasingly diverging, one of the converting topics at global scale as well as regionally, is environmental protection, which is among the key issues the EU unitedly wants to push forward also at the global scale. The globally acknowledged climate crisis has provided some common ground for policy making and has created space for common goals, yet the ability to influence third party commitment to change via trade policy tools includes risks and uncertainties that vary by country and industry. Thus, from the perspective of international business and individual companies, these future policy uncertainties increase political risks of international operations. Policy makers are challenged with finding ways to promote economic growth together with other values, and this complexity and uncertainty call businesses to seek new measures for having an impact on trade policies in the future. This multipolarity and multivoicedness makes global trade policy development, let alone anticipation, highly challenging.

Although the world today is not so united in terms of values, agreements and governance frameworks, it will inevitably continue to be united in some ways and in some constellations. New kinds of institutions and emerging agreements will pave the way for hopefully brighter and more sustainable future. This opens an opportunity for international business research to increasingly internalize insight from international politics in order to develop theories as well as managerial and policy recommendations that correspond with the increasingly complex reality of international trade and business. By embracing this challenge, we as international business scholars will have increasingly solid grounds and wider insight for contributing to the emerging next chapter of our societies, economic structures and global business dynamics.

Book available for purchase through Springer: https://link.springer.com/book/10.1007/978-3-031-13757-0

Anna Karhu & Eini Haaja

Pan-European Institute

Pro gradu –tutkielmassani analysoin sitä, miten Suomi nähdään vierailla markkinoilla ja miten ihmiset maailmanlaajuisesti ymmärtävät Suomen elintarvikkeidensa alkuperämaana ja miten yritykset hyödyntävät maakuvaa markkinoinnissaan. Maakuva on mielenkiintoinen ja laajalti tutkittu ilmiö, mutta Suomen maakuvaa koskeva tutkimusta on vielä niukasti. Tutkimukseni keskittyi suomalaiseen elintarvikealaan, jolla voisi olla paljon saavutettavaa kansainvälisillä markkinoilla. Tällä hetkellä elintarvikealalla on haasteita kannattavuuden suhteen ja kotimarkkinasuuntautumisen sijaan kansainväliset markkinat voisivat tuoda ratkaisuja ongelmiin.

Tutkimusaineisto kerättiin haastattelemalla alan suomalaisia asiantuntijoita sekä valtiollisista organisaatioista, että yksityisistä vientiyrityksistä. Haastateltavat edustivat Suomen Ulkoasiainministeriötä, Food From Finland -ohjelmaa sekä marja-, liha- ja maitotuotteita valmistavia yrityksiä. Keskustelua käytiin Suomen markkinointivahvuuksista, jotka rakentuvat sekä faktojen että mielikuvien varaan.

Aineisto osoitti, miten Suomi nähdään maailmalla ja miten tämä vaikuttaa markkinointipyrkimyksiin kotimarkkinan ulkopuolella. Tulosten perusteella Suomi on vielä kansainvälisesti suhteellisen tuntematon ja yritysten tulisi ottaa tämä huomioon viennin markkinointia suunniteltaessa. Lisäksi haastatteluissa ilmeni haasteena se, että Suomen alkuperämaakuvan kehittäminen ei ole ”kenenkään vastuulla”, vaan sitä tehdään yhteistyössä useiden toimialojen kesken sekä julkisten ja yksityisten toimijoiden kesken.

Alhaisesta tunnettuudesta huolimatta Suomen maakuva on pääosin positiivinen. Siihen liitetään mm. luonto, Lappi, korkea koulutustaso sekä tiettyjä tunnettuja julkisuuden henkilöitä tai hahmoja, kuten joulupukki. Kansainvälisesti potentiaalisten asiakkaiden kokemukset suomalaisista elintarvikkeista ovat hyvin rajalliset, joten Suomen alkuperämaakuva muodostuu aiemmin mainituista Suomeen yleisesti liitettävistä seikoista. Tällaista alkuperämaakuvan muodostumistapaa kutsutaan halo-efektiksi. Suomen alkuperämaakuvan soveltuvuus elintarvikealalle on suotuisa ja sitä tulisi hyödyntää maakohtaisena voimavarana. Suomalaisia elintarvikkeita viedään usein raaka-aineena tai puolivalmisteena, jotka soveltuvat lopputuotteita heikommin alkuperämaakuvan kansainväliseen vahvistamiseen kuluttajien keskuudessa.

Maakuvaan pohjautuvaa markkinointia tulisikin voimakkaammin mukauttaa kohdemarkkinoille ja viestin tulisi olla selvä, sillä kohdeyleisö pystyy vastaanottamaan vain rajatun määrän informaatiota. Tehokkaimmat markkinointiviestit tulisi tunnistaa ja hyödyntää markkinoinnissa, vaikka ne saattaisivat tuntua liian arkisilta tai näyttäviltä. Tämän vuoksi kotimarkkinoiden kokemuksiin perustuva markkinointi ei välttämättä tuota parhaita ratkaisuja kansainvälisille markkinoille.

Pro gradu –tutkielmani osoittaa, että suomalainen elintarvikeala ja maakuva ovat kiinnostavia teemoja, joista kannattaisi tehdä enemmänkin tutkimusta. Olisi myös mielenkiintoista laajentaa Suomen maakuvan tutkimusta muille teollisuuden aloille, sitä kautta voisi saada arvokasta lisätietoa kansainvälisen liiketoiminnan johtamiseen käytännössä.

Juho Siikarla

Some people think that markets are efficient and governments should let enterprises act freely in the market. In reality, public actors often intervene in markets and it is practically impossible to find a market that would not be guided by governments to some level. Partly, this is due to negative (e.g., pollution or addiction) or positive (e.g., education and welfare) impact of market activities that require brake or boost from public actors on a daily basis. Partly, the intervention is justified during the time of a shock, such as COVID-19 that encouraged governments to guide market action worldwide. Despite the importance of public actors shaping markets, there has not studies to develop our understanding of how public actors can shape markets, if they wish to do so.  

We studied how public actors shaped three interesting markets, namely (1) the betting market in Finland, in which public actors retained the domestic monopoly: (2) the open district heating market in Sweden, in which public actors changed the competitive landscape; and (3) the peer-to-peer lending market in New Zealand, in which public actors actively set up new structures and symbolic systems to facilitate new patterns of activity. We identified twenty granular mechanisms of institutional work that public actors employed to shape markets. These mechanisms are all potentially employable in creating, maintaining, or disrupting markets. Moreover, the idea of market shaping public actors is not limited to these three unique contexts. https://www.emerald.com/insight/content/doi/10.1108/JSTP-08-2019-0176/full/html

A forthcoming special issue on renewable energy in international business initiates discussion on the theme, and consequently the role of governments in supporting (and sometimes hindering) the market development. Governments for instance create and discard incentive policies for solar energy production and consumption. While these measures can have great impact, multilateral agreements are often criticized for not leading to changes in the market to diminish the amount of greenhouse gases. https://www.emerald.com/insight/content/doi/10.1108/cpoib-08-2019-0062/full/html

In another ongoing project, we study the business implications of coronavirus. It is evident that public actors took again a large role from closing restaurants to banning exports of masks and ventilators. The crisis bought new interesting questions from ’what is essential service’ and how can public actors determine and create metrics for defining ’essential’ to the questions on what kind of legislation is needed to limit free trade and secure national interest in forthcoming crises without deteriorating international competitiveness between the crises.

By having a better understanding of how public actors shape markets, it is possible to first guide them in making more informed decisions about market shaping as well as help companies in utilizing public authorities in driving the preferred market agenda. While interventions may hurt some market actors, for others political decision-making can be beneficial. We just need to make sure that the politicians are aware of various market-shaping mechanisms, make informed decisions in employing them, and ensure that the benefits of the intervention overcome the cost in the long run.

Valtteri Kaartemo
Postdoctoral Researcher, International Business D.Sc. (Econ.)

Greetings from Yorkshire! I moved here in January, with the help of a Tutkijat maailmalle -grant from Liikesivistysrahasto, to work on a project on cross-cultural management. For an international business researcher in general and a cross-cultural researcher in particular, this experience has already been an eye-opener into the reality of crossing borders.

Beginning from renting an apartment, more things are different than you might first imagine. I got some good advice when I was running in open houses: touch the walls to see if the paint is wet (a big no-no in the land of the mould), check if the taps actually work (as water pressure on this island can be horrible), ask about heating costs (which are huge and not included in the rent) and city council tax (which allows you to use the bins), and so forth. Setting up electricity and water bills, finding home insurance, getting in touch with the building manager in case something goes wrong, you name it – it is more difficult, when you are not exactly sure whose responsibility everything is. Luckily my landlord is very helpful and has so far sorted out a leak and a broken oven in record time.

Everyone at the University has been very friendly. However, as people tend to live a bit further away, not many come to the office daily, which can make the place feel a bit lonely at times. Nevertheless, once a week we meet for an international business faculty coffee break to catch up on the latest on research and teaching. In addition, I have joined a paper development circuit, which is basically a series of mini seminars, as well as a qualitative research reading group, which is also basically a series of mini seminars, but explicitly focusing on qualitative studies. Cooperation with my hosts Professor Jeremy Clegg and Associate Professor Hanna Gajewska-DeMattos has been intense yet rewarding. The work is running smoothly, albeit coming up with a new theory of cross-cultural management is not the easiest thing I have attempted. I am lucky to have such innovative co-authors and mentors on my visit.

Of course, I was here for Brexit day. Despite raucous parties going on in London, Leeds remained no more pub-going than on any regular Friday. In central Leeds, according to voter maps, most voted against Brexit. However, Yorkshire as a whole is rather rural. The traditional business here is sheep farming. Thus, once outside the central city area, you are more than likely to run into brexiteers. Like my cab driver, who said he preferred a new British colonialism to a Fourth Reich. While I have never had any trouble with anyone, you can sense the country is deeply divided. The atmosphere reminds me of the first five minutes after a fight with a sibling, when you think you will never be friends again. I think it will take years for these wounds to heal.

Brexit has had so many dates now, that people really are fed up with it. The first time around, my Yorkshire friends were stalking up on toilet paper and food like there was going to be an immediate shortage. When Brexit eventually happened, I heard of no-one hoarding. It is like a never-ending story, which even now is in sort of limbo, as we cannot yet tell what the EU-UK relationship will look like in the future. And of course, we never know what might happen. The scariest scenarios are that healthcare runs out of medicine and workers – which, according to some projections, is not as far-fetched as it sounds. Nevertheless, there is much advice available to whomever needs it. For example, the University of Leeds hosts Brexit seminars often to give advice to foreign employees and students on how the changing situation will affect them. Luckily, I will move back to Finland before the transition period ends, so should be safe and sound.

There are two things I have learned since moving to Yorkshire. First, there are many, many more variations of not raining than you thought. There are the tiny droplets that fall rapidly but are so small that they do not make you wet. There are the huge droplets which fall so slowly they do not make you wet. There are the medium-sized droplets that fall at a medium speed, again not making you wet. Basically, anything short of soaking you through in five minutes flat is not considered rain. Second, I finally understand, why the call it a howling wind. My windows in Finland, no matter how much draft they tracked in, have never made such a sound. Think of a strong wind caught in a pipe. Double glazing here means a second window has been built in a bit inward from the original. The glazing layers are basically unconnected, leaving the air in between to do whatever it wills. And sometimes, it howls. Luckily there’s much tea and biscuits to be had to keep you warm. Betty’s of Harrogate, which you may know through their export brand Taylor’s of Harrogate, is apparently the place to go for afternoon tea around here. Their scones are definitely worth a try.

Dr. Riikka Harikkala-Laihinen
Postdoctoral Researcher, University of Turku
Visiting Researcher, Leeds University Business School

Our perspectives on International Business are constantly evolving and broadening as we accept that the world is more complex than what a narrow perspective on the ‘international success and failure of the firm’ can explain. The global business environment is composed of systemic force fields where events forming initial conditions can produce a multitude of new phenomena and outcomes in very short time.  It is the dynamic and complex interconnectedness, interdependencies and interactions of political, economic, social, technological and environmental systems, among others, that we call globalization, which has brought to us unprecedented wealth, but also new problems, and of course also potential solutions.

But, sitting in Finland looking out of the window, how skewed is our perception of the big wide world really? According to Hans Rosling’s (Rosling et al., 2018) book, Factfulness, we tend to believe that the world is poorer, less healthy and more dangerous than it really is and that the way we perceive global events through media biases our shared picture of the world. One current example is the recent novel Corona Virus outbreak in Wuhan, China. When following the news coverage and discussions in social media, this provides a very good case of globalized systems and how events very far away arrive, by plane or media, and affect the way we go about our daily lives, affecting stock markets and threatening the functioning of value chains. Or a speech of a Swedish teenager who requests to do something about a looming catastrophe is sending shock waves around the political and corporate establishment is another example of the interconnectedness and interdependencies.

However, there is an array of topics that usually are on a blind spot, at least where we are sitting and that should interest us as much as many other topics. We have started to discuss these under the label ‘the dark side’ of international business, some time ago. It consists of topics that seem very far from our perception and are nevertheless part of the systems we live in. For instance, having recently reviewed an article on Modern Slavery was a revelation. According to the International Labor Organization and the Walk Free Foundation (2017) for every 1000 people in the world 5.4 are considered victims of modern slavery, being exposed to the effects of another person having control over one, being in a relationship suffering structural power or physical violence with the objective of being economically exploited. Some of the global value chains that produce many of the products and services we might consume daily are using questionable practices. These require more attention.

Over the past years, our research interests have turned towards these less popular but hugely important issues. TSE has made business ethics and critical engagement key strategic organizational values that should partly define who we are as an organization. As a result, we have many researchers who have been investigating these kinds of topics. For instance, Salla Laasonen (doctoral defense 2012) has written about stakeholder dialogue as a tool for corporate responsibility and accountability. Frederick Ahen (doctoral defense 2015), critically examined the corporate social responsibility narrative in the context of global health urging to make responsibility a key strategic dimension rather than a public relations activity. Irfan Ameer (doctoral defense 2019) has been investigating the broader social context of institutionalized bribery in developing countries and he discussed corruption practices of Multinational firms. Emilia Isolauri (current doctoral student) investigates the sources, mechanisms and outcomes of international money laundry and Isabella Galvis (current doctoral student) researches the competing pressures under which social enterprises in different institutional contexts have to balance their goal attainments. These are just a few of many examples and we can see that critically engaged international business scholarship is an important movement, which is further taken up in numerous Masters theses and which is increasingly becoming a strong integrated part of our courses in the Bachelor and Masters programs.

The goal is to include other than mainstream topics in international business to form some of the important foundations when the next generations of graduates join the constituencies they choose to serve and eventually one day steer.

Dr. Peter Zettinig

University Research Fellow

Adjunct Professor in International Business