This issue of MOR closes out volume 11, which has witnessed the transition of the journal's domain to attract and publish social science research underlying an across-the-board range of themes in management, organizations, strategy, and public policy in the context of China and all transforming economies. The challenge for MOR is to be open to indigenous theories of management, organization, entrepreneurship, innovation, and economic development. However, this is not about contradicting the accumulated body of extant management and international business scholarship. At its core the intellectual challenge is to recognize that history, stage of economic development, institutional configuration, cultural differences, and national ambitions have the potential to give rise to new forms of organization and management. The challenge for MOR is to encourage and publish such research that meets the state-of-the-art scholarship criteria of the social sciences.

This introduction traces the disappearance of Chinese family businesses from 1949 to 1978, their revival since then, and their future challenges. It then summarizes the three papers included in this Special Issue and proposes an agenda for family business studies in China. The article first focuses on the nonmarket social and political network strategies that these family-centered business organizations have had to adopt in order to overcome the difficulties they faced in accessing opportunities and resources as a result of Chinese culture's traditional low esteem for merchants and the government's continuing preference for a state-dominated economy. Family firms have so far been able to grow disproportionately rapidly in China's economy because, by leveraging the shared interests and dedication of immediate and extended family members, they have been able to achieve lower cost and higher efficiency, respond quickly to market changes, and expand social and political networks. These nonmarket strategies, however, also have a dark side. Furthermore, as the liberalization of China's economy deepens, competition must rely critically on market strategies such as innovation, alliances, and internationalization. The proposed research agenda addresses these future challenges as well as some research questions unique to Chinese family businesses.

Loan guarantees to related parties by affiliated subsidiaries within family controlled pyramids form a means by which the controlling family expropriates value from minority shareholders. The controlling family, however, will attempt to escape blame for the behavior. Using a sample of 1785 listed Chinese firms affiliated with family-controlled business groups, we explore how family governance structure affects the use of related party loan guarantees. As hypothesized, we find that affiliates with non-family chairmen, but with family directors or senior executives, issue larger volumes of loan guarantees to related parties, whereas affiliates with family chairmen and those with non-family interlocking chairmen do not. The behavior is moderated by regional institutional development.

Drawing on expectancy theory and the socioemotional wealth (SEW) perspective, we propose that family owners with intrafamily succession intention are more motivated to accumulate or preserve SEW. As corporate philanthropy is a critical way for family-controlled firms to accumulate or maintain SEW, family owners with intrafamily succession intention are more likely to engage in corporate philanthropic activities. Data on a nationally representative sample of family-controlled firms in China support our prediction. We also find that the relationship between intrafamily succession intention and corporate philanthropy is moderated by family owners’ social status and religiosity. The findings contribute to our understanding about family businesses, in general, and those in China, in particular, as well as the SEW perspective.

This study investigates the differential effects of internationalization on two dimensions of family firms’ performance: growth and profitability. Drawing on the contingency theory, we argue that the successful implementation of internationalization strategy requires an appropriate organization structure, which is usually absent in Chinese family firms. To the extent that such a structure is established, these firms can realize greater benefits from internationalization. From a sample of 225 family firms in China, our predictions receive empirical support. We find that internationalization has a positive impact on growth but a negative impact on profitability. The negative internationalization–firm profitability relationship highlights the challenges internationalizing Chinese family firms face. The positive moderating effect of corporate governance, a critical component of organization structure, underscores the need for appropriate corporate governance to support the implementation of strategy. The findings have important practical implications for the internationalization of Chinese family firms.

Extending La Porta, Lopez-de-Silanes, Shleifer, and Vishny (1999), we examine the effect of local government quality on firm performance, since regional and firm research provides a more fine-grained analysis especially in countries where local administration is an integral part of the bureaucratic apparatus. Using a dataset of 7,873 Chinese listed firm-years for 1994–2006, we find a positive relationship between the quality of provincial government and firm performance, controlling for location and firm-specific governance variables. Among various government quality variables, we find that having a special economic zone depicting low taxes and bureaucratic efficiency is the best predictor of firm performance, followed by the degree of marketization, efficient property registration, and environmental protection. Most intriguingly, political freedom has a significant impact on firm performance and productivity, even in a regime where democracy is not practiced. This has never been documented before at a microeconomic level and barely so at a macro level, vindicating Hayek's (1944) theory.

Choi, Jiang, and Shenkar (2015) offer an interesting and new perspective on the relationship between local governance and firm performance in China. This commentary focuses first on how we conceive of the nature of China's capitalism and then examines what that suggests about their metrics and findings.

In a transitional economy such as China's, when resources are unevenly distributed across different sectors, the disadvantaged sector may seek a growth path that bypasses resource constraints. We investigated this phenomenon in the context of the Chinese real estate industry. By comparing the post–merger and acquisition (M&A) performance of acquiring firms between state-owned enterprises (SOEs) and privately-owned enterprises (POEs), we attempted to show that POEs are better performers in the market should they be granted equitable resources, and the superior performance is strengthened by market-oriented institutional environment. We used M&A events data of publicly listed real estate firms in China from 2004 to 2012, in conjunction with firm characteristics and province-level market environment data. We found the results to be consistent with our hypotheses. In particular, compared to SOEs, privately-owned acquiring firms tend to have better post-M&A performance when both the regions of the acquirer and the target have high level of marketization. The results suggest that the private sector in China's transitional economy is potentially more efficient than the state-owned sector, as long as the market environment is favorable.

In this article, we propose that types of CEO paternalistic leadership will affect the effectiveness of top management team (TMT) decisions, and that team conflict will play a mediating role in the relationship between CEO paternalistic leadership and decision effectiveness in the Chinese context. Data collected from 108 TMTs in China suggest that dimensions of paternalistic leadership significantly affect decision effectiveness: benevolent and moral leadership positively affect TMT decision effectiveness, but authoritarian leadership has negative effects on TMT decision effectiveness. In addition, cognitive and affective team conflicts partially mediate the links between paternalistic leadership types and decision effectiveness. The results suggest that CEO paternalistic leadership approaches and conflict modes significantly determine TMT decision effectiveness.

This paper explores the relationship between poetry and leadership – in particular, how business leaders might leverage poetry in practice. Drawing on the theoretical lenses of logic of appropriateness and ambiguity, we suggest a conceptual model to understand the multilayered meaning of poetry, noting that poetry has four layers of meaning: the superficial meaning, the poet's evocative meaning, the reader's recasting into a modern situation, and the recipient's interpretation. Using the storytelling research method, we collected leadership narrative stories that indicate poetry as an effective communication tool in practicing leadership. From these data, we identify four approaches that leaders use to apply the multilayered meaning of poetry in contemporary business practice: drawing lessons from poets' experience through critical interpretation of the poem, inspiring leaders' heroic spirits, guiding leaders' rules of behavior, and adopting poetry as a tactic to influence others. Our study contributes to the argument of ambiguity as a source of intelligence and illuminates how poetry as an artistic form of story facilitates contemporary leadership practice in light of the logic of appropriateness framework.

This is a wide ranging call for papers addressing and extending Professor Kwok Leung's scholarship in cross-cultural research, psychology, and management (see below).

Questions about the special issue may be directed to any of the guest editors. Papers for the special issue should be submitted electronically through MOR's ScholarOne Manuscripts site at http://mc.manuscriptcentral.com/mor and identified as submission to the ‘Scholarship of Kwok Leung’ special issue. All submissions should follow the ‘MOR Author Guidelines’, available online at http://journals.cambridge.org/images/fileUpload/documents/MOR_ifc.pdf

We are excited to announce the Second Management Organization Review (MOR) Research Frontiers Conference. This interdisciplinary Research Frontiers Conference serves as MOR exploration dialectic for advancing and opening new research directions of phenomena in the social sciences underlying management and organizations, globalization, and economic growth through boundary-crossing dialog and discourse with a focus on all transforming economies.