#4789. The bridging role of regional headquarters. Multinational companies in the Asia-Pacific region

July 2026publication date
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Journal’s subject area:
Business, Management and Accounting (all);
Business and International Management;
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Abstract:
Large multinational companies (MNCs) are strongly formalized, often standardized and complex with multiple hierarchical levels. Over the past few decades, MNCs have strengthened their coordination and control systems by creating regional headquarters (RHQs). This study aims to investigate how MNCs rearticulate control dimensions at RHQs, to coordinate and exert control over subsidiaries. This study applies a structural equation model to determine RHQs’ roles in the field of regional decision-making, coordination and control. Large MNCs transfer coordination and control to RHQs, in a way that leads us to propose the use of the expression “regio-centralization.” RHQs become socialization hubs, where most regional decisions are taken and where international managers meet. Thus, informal control at RHQs increases, partly substituting formal control by HQs. Smaller MNCs, without RHQs, on the contrary, base their control and coordination on the formalization of HQs-subsidiary relations, especially through strong reporting, in combination with centralized decision-making at HQs. This study leads to a better understanding of how large MNCs reorganize dispersed activities by creating RHQs, where important control and coordination functions are relocated.
Keywords:
Asia-Pacific region; Centralization-formalization-socialization; Control; Multinational companies; Regional headquarters

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