Institutional Pressures and Environmental Performance in the Global Automotive Industry: The Mediating Role of Organizational Ambidexterity

This article investigates why do firms in a common organizational field have different environment performance. The institutional theory suggests that firms may adopt reactive (exploitation-based) or proactive (exploration-based) strategies to respond to institutional pressures of varying levels. The perspective of organizational learning also suggests that successful firms in a dynamic environment are ambidextrous - the simultaneous pursuit of exploitation and exploration. In this study, I integrate these two perspectives and argue the mediating role of organizational ambidexterity in the relationship between institutional pressures and environmental performance. The regression analyses of 74 global automakers capture my arguments and also provide important implications.