Sustainability orientation and post-entry performance: The role of brand and market-oriented capabilities

Abstract

The adoption of sustainability orientation (SO) by international new ventures (INVs) has been generally noted to positively influence their post-entry performance. However, knowledge is lacking on organizational mechanisms and firm capabilities which combine with SO to help firms achieve improved post-entry performance. Consequently, we adopted the natural resource-based view (NRBV) to explore how international brand orientation (IBO) mediates this relationship. In addition, we shed light on when the relationship is more pronounced by examining how firms' dynamic capability, relating to levels of market orientation (MO), enhances or attenuates this linkage. Using time-lagged data from 288 INVs operating in Ghana, the results reveal that the positive effect of SO on post-entry performance is mediated by IBO. Additionally, the effect of IBO on post-entry performance is amplified when a firm's MO is high. Thus, we show that INVs from developing markets are more likely to maximize the positive effects of pro-environmental strategies on their global market performance if these are complemented by effective brand management and elevated market-oriented capabilities.