Chapter 6: Rethinking International Financial Management: Towards a New Institutional Logic

Conventional mathematical optimization strategies in international financial management (IFM) often fail to align with real-world applications and may even pose risks for multinational corporations (MNCs). This chapter reevaluates IFM by recognizing the role of unforeseen events and emphasizing a stakeholder-centric approach. It proposes a revised methodology in which financial resilience is the primary objective, grounded in the empirical-pragmatic approach, behavioural finance, and financialization literature. This methodology outlines how MNCs can enhance financial resilience by focusing on adequate financial revenue, robustness and diffusion. The chapter aims to provoke thought while offering practical solutions for MNCs. Adopting a co-evolutionary institutional perspective, it introduces a new institutional logic for IFM that strengthens global strategy, international corporate governance, and the control and coordination of MNCs.