Governance mechanisms and social responsibility performance in international megaprojects: the contingent role of host country institutional environment

Purpose Beyond the traditional concerns of cost, time and quality, megaprojects often face criticism for failing to meet social responsibility expectations, which are essential for ensuring their long-term sustainability and legitimacy. Governance mechanisms, particularly contractual and relational mechanisms, offer potential pathways to improve megaproject social responsibility performance (MSRP). However, their effectiveness can vary depending on the host country's institutional environment, particularly in the context of international megaprojects. Therefore, this study examines the impact of governance mechanisms on MSRP and the role of the host country's institutional environment in moderating these effects with a specific focus on Belt and Road Initiative (BRI) megaprojects. Design/methodology/approach A conceptual model comprising six hypotheses was developed. A questionnaire survey was designed, refined and distributed to the participants in the BRI megaprojects, yielding 145 valid responses. The resulting data were analysed using partial least squares structural equation modelling (PLS-SEM). Findings The results indicate that both contractual governance and relational governance positively improve MSRP. While the host country's institutional environment does not directly impact MSRP, it plays a significant moderating role. Specifically, a weak institutional environment positively moderates the impact of contractual governance on MSRP, but it weakens the positive relationship between relational governance and MSRP. These results highlight the importance of adapting governance mechanisms based on the institutional context of the host country. Practical implications The findings suggest that policymakers and stakeholders should adopt context-specific governance frameworks that balance contractual and relational mechanisms while considering factors such as legal systems, political stability and economic development in the host country. Such tailored approaches enhance social responsibility performance in BRI megaprojects. Originality/value The study is one of the pioneering efforts to examine how different governance mechanisms enhance social responsibility performance in BRI megaprojects, with the host country's institutional environment playing a key role in shaping and determining the efficacy of these mechanisms.