Article

Journal of International Business Studies (2008) 39, 151–166. doi:10.1057/palgrave.jibs.8400313

Human resource management in US subsidiaries in Europe and Australia: centralisation or autonomy?

Mark Fenton-O'Creevy1, Paul Gooderham2 and Odd Nordhaug2

  1. 1Open University Business School, Milton Keynes, UK
  2. 2Norwegian School of Economics and Business Administration, Bergen, Norway

Correspondence: M Fenton-O'Creevy, Open University, Walton Hall, Milton Keynes MK7 6AA, UK. Tel: +44 (0)1908 655804; Fax: +44 (0)1908 655898; E-mail: m.p.fenton-ocreevy@open.ac.uk

Received 12 July 2004; Revised 26 May 2006; Accepted 27 March 2007; Published online 30 August 2007.

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Abstract

We explore determinants of subsidiary autonomy in setting human resource management (HRM) practices within US-parented multinational enterprises (MNEs), in Europe and Australia. We examine both the effect of strategic context and the effect of the institutional location of the subsidiary. We find that US MNEs show greater centralisation of control over HRM where the subsidiary faces global markets, in coordinated market economies vs liberal market economies, and where union density is low.

Keywords:

international HRM, subsidiary management, neo-institutional theory, strategic context, centralised control, multinationals