While the institutional environment in the host country constrains the behavior of the MNC, particularly in the area of HRM (Rosenzweig/Nohria 1994; Sparrow/Hiltrop 1997), there may at the same time be strong country-of-origin effects in the sense that the MNC imposes policies on subsidiaries or subsidiaries adopt country of origin practices in order to look good in the eyes of the parent company (Giardini et al. 2005).