Cultural distance bridging strategy and partners’ trust: an institutional construction perspective

Purpose We use the spread of the home country’s culture into the host country as a cultural distance bridging strategy (CDBS), examines the effect of the CDBS on host country partners’ trust in multinational enterprises (MNEs) as well as the moderating effects of diplomatic relationships and social ties (business and political ties). Design/methodology/approach This research employs ordinary least squares regression analysis to examine data obtained from 127 managers working for subsidiaries of 110 Chinese MNEs. Findings The results demonstrate that the home country’s CDBS increases the trust of the host country’s partner in MNEs. This impact becomes stronger when the home and host countries have developed good diplomatic relationships and when the MNEs have established extensive business ties in the host country. Originality/value The study highlights the effectiveness of CDBS in enhancing the trust of host-country partners in MNEs and sheds new light on the research about international business (IB) on how to foster trust between collaborative enterprises. It further enriches the understanding of trust relationships among MNEs by exploring the moderating effects of diplomatic and social relationships.