| This thesis aims to explore the obstacles Chinese companies encountered when they invested in Australia by regarding them as the liability of foreignness and examining them through the lens of the institutional theory.Another aim of the thesis is to explore the measures taken by Chinese companies to deal with such institutional barriers.In order to answer these two questions,this thesis adopts the research method of case study and studies Chinese companies' involvement in the sale of S.Kidman&Co Ltd.This thesis fulfills the first aim by searching for the regulatory,normative and cognitive barriers faced by the Chinese companies when they bid for the Kidman portfolio.The regulatory barriers are mainly presented by Australia's foreign investment review framework.When Chinese companies enter into the Australian market,compared to the Australian local companies,aside from the universal regulations,they have to be scrutinized by the Australian regulations on foreign investment.However,the Foreign Acquisitions and Takeovers Act 1975 which set the legislative framework did not provide a specific notion of national interest.Against such background,national interest remained to be one of the prime factors that influenced Chinese investment in Kidman.Moreover,the Treasurer,when making decisions,is not required to publish his or her rationale behind the decision.In this case,the result became pretty unpredictable for the Chinese investors.When Chinese companies were competing for the properties of Kidman,they were evaluated by the values and norms of the Australian public and politicians,which posed normative barriers for them.To be more specific,the role played by agriculture in Australia's economy and people's life is so fundamental that foreign investment and acquisition in this sector is more likely to draw local people's attention.For general Australians,what they were worried was what the investment of such foreign investment might entail.In domestic Australians' opinion,the overseas investment from China in their agriculture might pose a threat to their employment and national food security.For the politicians,they needed to "manage community expectations and fears" and at the same time to win votes.From the cognitive perspective,the iconic historical status of the Kidman company and the people's attachment to the story behind its founder and the development of the company were subtle but also decisive elements in this case.Moreover,aside from the symbolic status of the Kidman estate,what prevented Chinese entities from successfully purchasing it was the deep-seated distrust among Australians generated from their cultural systems.As a result,this mentality posed difficulties for Chinese investors to get involved in Australian business,especially when the Kidman parcel belonged to agriculture which was deemed as a sensitive sector.Faced with problems from the three perspectives,Chinese companies adopted a range of measures to overcome them and achieve legitimacy in Australia.The first measure taken by the Chinese investors was adjusting their ownership strategy and lowered their percentage of equity ownership in the proposal when forming a partnership with local firms.Besides,Chinese investors worked hard to obtain the "social licence" in operating in Australia.Measures taken or to be taken included recognizing their social responsibilities,employing local residents,involving local suppliers,obeying local values,and strengthening their relationship with local communities.By employing the institutional theory,this thesis offers a unique and comprehensive analysis of the factors that influenced the Chinese companies' purchase of Kidman portfolio by seeing it as more than a commercial issue.Besides,Chinese companies that invest abroad are mainly state-owned enterprises yet the private Chinese companies begin to show the momentum in overseas investment.The major players in this case were Chinese private-owned enterprises,which would complement literature into the new trend of development. |
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