This article leverages identity theory to address the question of when and how foreignness acts as an advantage and liability for the MNE subsidiary. Applying an organizational identity lens, I delineate how subsidiaries manage their foreignness by accentuating and attenuating internal and external organizational attributes. Drawing on this conceptualization, I theorize how an accentuated foreign identity moderates context-specific advantages and liabilities. In offering a more nuanced understanding of how subsidiaries actively manage their foreignness, and its contextual implications, an identity-based framework helps to both explain and reconcile the advantages and liabilities of foreignness.

Scholars increasingly recognize that organizational fields contain minority identities, linked to alternative logics. Extant work has been largely silent on how such minority identities are maintained, and what their implications are for organizational agency. I contribute to filling this gap by examining how organizations cultivate minority identities, and how such identities both enable and constrain agency. Employing the foreignness of multinational enterprise subsidiaries as a particular case of minority identity, I find that managers actively cultivate minority identities by embedding into niche networks, reinforcing alternative expectations, and categorizing themselves into distinct collective identities. These elements of the minority identity enable particular forms of agency - internal experimentation and an external license to deviate - while constraining others - adaptation to the dominant logic and positioning in mature market segments. The findings extend theory by highlighting how minority identities are generated and sustained, as well as their implications for agency.

Scholars increasingly emphasize the impact of institutions on multinational enterprises (MNEs), but the opposite relationship has attracted less research that is, MNE agency in relation to institutions. Based on a comparative case study of six MNEs from the United States and Sweden, this paper remedies this. It explores and explicates MNE subunits' strategic responses to host country institutional constraints and opportunities in five different regions. A new-institutional approach is adopted, which allows for an investigation of MNE subunit agency in relation to normative and cognitive institutions, as well as regulative ones. This fine-grained analysis reveals not only what kinds of responses MNE subunits invoke, but why and how they are able to respond. We identify four strategic responses by which subunits shape, transpose and evade institutions in the pursuit of competitive advantage: Innovation, Arbitrage, Circumvention and Adaptation. These responses are driven by three key enablers: multinationality, foreignness and institutional ambiguity - that serve to enhance and heighten three mechanisms: reflexivity, role expectations and resources. By linking the enablers and the mechanisms to specific types of strategic responses in a framework and typology, the paper not only contributes to emerging research on the interplay between MNEs, institutions and strategy, but to strategy practice.