Developing Proactive Compliance Mechanisms for Chinese International Construction Contractors: A PLS-SEM Analysis

The international construction contracting industry is facing increasingly stringent regulations and complex compliance risks, forcing contractors to reluctantly comply with regulations to cope with external pressure, intense competition, and turbulent markets. The existing research focuses on the passive compliance of contractors and sporadically identifies the driving factors, and lacks a detailed exploration of proactive compliance, which has created a research gap in regard to contractor compliance management, wherein changes to internal passive control and external environmental dynamics cannot be addressed. This study aims to promote proactive compliance by contractors by establishing a theoretical framework, containing factors related to stakeholder pressures, project complexity, and compliance values. This study involves 135 samples of international construction experience, utilizing the partial least squares structural equation modelling (PLS-SEM) technique for data analysis. The findings demonstrate a significant positive impact of stakeholder pressures (β = 0.328, p < 0.01) and compliance values on the promotion of proactive compliance by contractors (β = 0.246, p < 0.01). Moreover, the study reveals that project complexity further strengthens the relationship between stakeholder pressures and proactive compliance (β = 0.203, p < 0.05). By deepening the understanding of the interactions between external pressures, internal control, and proactive compliance in regard to complex project attributes, this study offers a theoretical framework that integrates project level factors and organizational level factors. This study contributes guidance for contractors facing compliance challenges in the global context, enabling them to tackle increasing compliance pressures and risks, thereby facilitating the development of proactive compliance strategies in complex project environments and enhancing their competitiveness and sustainability.