Risk Management in MNEs during Global Crises: Subsidiary Control or Autonomy?

Tensions between control and autonomy in multinational enterprises (MNEs) have attracted considerable academic interest, which has been additionally fuelled by multiple crises following the 2008 global recession. These have intensified the exploration of interentity relationships within MNEs and their implications for risk and crisis management and resilience. Our study examines how the autonomy of subsidiaries in a risky Central and Eastern European market (Slovenia) influences risk and crisis management strategies as well as resilience of subsidiaries in the midst of global crises such as the Covid-19 pandemic and war in Ukraine. We analyse the performance of foreign subsidiaries during these two crises (2019–2022) with a particular focus on the impact of centralisation tendencies in the home country of the MNE’s headquarters on subsidiaries’ growth as well as their risk and crisis management responses. The results demonstrate above-average performance of foreign-owned subsidiaries, highlight the role of subsidiary autonomy in risk and crisis management, and show how multinationals prioritise the value creation of subsidiaries in emerging markets by granting them greater autonomy in times of crises.