'Englishization' in cross-border mergers and acquisitions: trends and effects on integration

Abstract

Cross-border M&As were deemed an appropriate setting for this study as they are an important form of foreign direct investment and integration plays a critical role in the success of M&As. In addition, English is frequently used as a 'lingua franca' or global business language, so more knowledge on how it is used in corporate practice is valuable. This study focuses on language, a 'forgotten factor' that many international management studies have grouped under culture. Therefore, the objective of this study is to examine the trends behind the dominant use of English in international business and how the implementation of English as the common corporate language influences the integration process in cross-border M&As. The perspective of this study is from British and American business news sources as organizations from these countries have not been under the radar of many language-sensitive international business scholars.

The study was conducted as a qualitative study of texts. Since the object of the study is American and British business news sources, the data was collected online and includes articles, blogs, and comments from six websites (FT.com, Forbes.com, ManagingAmericans.com, Economist.com, Inc.com, and BusinessBlogsHub.com). A total of 67 posts were selected. The documents were analyzed through thematic content analysis.

The results of the study align with Piekkari et al.'s (2005) findings that the use of English as CCL in cross-border M&As has integrating and disintegrating effects. The integrating effects found in the data include offering a medium of communication, achieving efficiencies, helping to unite a global workforce, developing a shared culture and strategy, promoting change, providing neutral ground, accelerating integration, and giving the impression of an international outlook. The disintegrating effects cited in the posts are employee hardship, disparity between formal strategy and practice, hindered communication, separation of language groups, and overemphasis of language skills on employee evaluation. A key finding in favor of using English as CCL is that it can give the impression of openness, adaptability, and an international outlook; therefore aiding in the integration process of M&As, especially in the case of countries where using English in business is not the norm, such as Japan. The English language trends observed include the increasing amount of non-native English speakers and the possible disadvantage of native speakers when communicating with non-native speakers. Additionally, using English as the company language was seen to help transform the company mindset to be more global. As psychic and cultural distance theories suggest, the data also showed that the English language appears to play a role in the decision-making process of where to invest abroad. Though the British and American business news sources recognize the issues surrounding the use of English as CCL in cross-border M&As, they remain confident in, and perhaps overly-optimistic about, the current and future superiority of English as a global business language.