This issue of MOR features a guest editorial by deputy editor Professor Klaus Meyer on the role of ‘Context in Management Research in Emerging Economies’ and a Perspective paper co-authored by Yadong Luo and John Child on ‘The Growth of Emerging Economy Enterprises: A Composition-Based View’, followed by two commentaries. The first, ‘Extraordinary Survival from Ordinary Resources – How So?’, is by Richard Burton and the second, ‘Reframing the Compositional Capability’ is by Henk Volberda and Emre Karali.

The challenge of integrating context when theorizing is not unique to research on management in emerging economies (MEE). Principally, all management scholars aspiring a theoretical contribution should be concerned about context, as emphasized by Whetten (1989: 492) in his oft-cited guidelines.

This article presents a composition-based view (CBV), which explicates the growth of enterprises that compete and develop without the benefit of resource advantages, core technology, or market power. The CBV emphasizes how ordinary firms with ordinary resources may generate extraordinary results through their creative use of open resources and unique integrating capabilities, resulting in an enhanced speed and a price-value ratio that are well suited to large numbers of mass market consumers. In addition to defining the CBV, this article explains the key elements of composition-based strategy and the distinctive processes of composition. Although CBV logic can apply to any firm endeavoring to catch up with better endowed competitors, it aligns well with the case of emerging economy enterprises (EEEs), and Chinese ones in particular. Nonetheless, the advantages of adopting composition-based strategy are temporary in nature and will decline over time, especially after the firm passes the imitative or catch-up stage. We also propose an agenda for future research.

This commentary targets the core ideas of the composition-based view (CBV). First, we argue that the deployment of compositional capabilities (CCs) to combine ordinary resources fits the resource-based view (RBV) and that there is therefore no need for a CBV. Second, we argue that the CCs should be presented as a specific type of dynamic capability (DC). We show that even where ordinary resources are being combined, superior combinatory capabilities are needed as competitive advantage cannot otherwise be achieved. Third, we argue that Luo and Child (2015) focused too much on the emerging economy enterprises (EEEs) as the conceptual setting. We conclude with a future research agenda to prepare the ground for research on compositional capabilities within the composition-based view of the firm.

As China shifts its development model from focusing on economic growth at all costs to a model in which economic growth is balanced with solving pressing societal and environmental problems, there is an increasing need for management research on building sustainable organizations in China. This collection of papers focuses attention on the role of business in promoting sustainable economic development, highlighting a number of key processes including: the factors that foster transparency and CSR reporting, how stakeholders can influence corporations to abandon their CSR commitments, the benefits of environmental branding and labeling, and the antecedents and performance consequences of proactive environmental strategies. In this introductory essay we reflect on recent trends in sustainability research in China, and to encourage this important movement, provide recommendations for future research directions.

The existing literature does not provide adequate insight into the initial diffusion of new management practices, especially those that yield no immediate economic benefits, and have not yet gained legitimacy. We study how firms’ local institutional environments influence early adoption behavior, examining the spread of corporate social responsibility (CSR) reports in China's banking industry from 2006 to 2011. We find that banks are more likely to be first movers of CSR reporting if they operate in communities where more companies publish CSR reports or where there are guidelines encouraging CSR reporting, and the impacts of these two institutional factors are further moderated by the length of time that banks have operated in communities. Our study highlights the usefulness of institutional theory in understanding the initial adoption of new management practices, when the organizational field is defined as a geographic community instead of an industry sector and its supply chain.

In this study, we use the context of corporate social responsibility (CSR) suspension and provide a case study from China to show how conditions allowed shareholders to seize power and alter a firm's mission. We show that managers reacted to a change in shareholder power by changing their priorities to correlate with shareholder influences. Our dynamic model first highlights the importance of precipitating events that allowed shareholders to seize power. In response, managers rebalanced their priorities, paid more attention to the shareholders who demanded higher profits, and suspended ethical and discretionary responsibilities as a result. We further present evidence that CSR suspension subsequently harms relationships between stakeholders and threatens firm survival. We contribute to stakeholder theory by providing a dynamic model for interpreting stakeholder influences and managers’ subsequent responses. We add to corporate social responsibility studies by providing a more nuanced understanding of CSR suspension.

Drawing on economic, sociological, and strategic perspectives, we use data of a large sample of 936 Chinese manufacturing firms in the period from 2000 to 2005 to examine how environmental labeling may affect a firm's financial performance. We argue that reducing information asymmetry, increasing legitimacy, and differentiating strategically through environmental labeling may prompt customers to patronize the firm, thereby enhancing firm performance. However, not all firms benefit equally; environmental labeling conveys fewer benefits for larger firms and for firms listed in a stock market, because they are less threatened by information asymmetry or insufficient organizational legitimacy. Our findings suggest that environmental labeling has generally limited influence on financial performance, but for small and unlisted firms, environmental labeling increases sales.

In this article we provide a comprehensive framework to explain, in China and in Western countries, how three antecedents – regulations, stakeholder norms, and managerial mindsets – differently affect proactive environmental strategies (PES) and subsequently influence firm performance. A meta-analysis of 68 studies involving 71 samples supports our hypotheses. In Western countries, top managerial mindsets have the strongest effect and regulations have the weakest effect on PES. In China, regulations, stakeholder norms, and managerial mindsets have similar effects on PES. For Western firms, the PES has stronger effects on environmental performance than on economic performance and the effect on environmental performance is stronger than that in Chinese firms. For firms in China, the PES has equally positively affects on environmental and economic performance, but the effect on economic performance is stronger than that of Western firms. Implications for future research are discussed.