DescriptionBased on agency theory and institutional perspective, I argue that staffing composition in a foreign subsidiary reflects the aggregate effect of formal and informal institutions in the host country and that the composition affects subsidiary performance. The opportunism in agency relationships varies with the extent to which culture constrains the opportunistic behavior of local employees, and this, in turn, influences the staffing composition for headquarters to reduce agency costs in a subsidiary. Furthermore, I also argue that, although a high proportion of local employees outsourced from outside headquarters detrimentally affects its subsidiary performance, this negative relationship is moderated by the cultural characteristics of the host country which restrict the opportunistic behavior and goal-incongruence in work contracts. Lastly, the business group association of a parent firm contributes to increasing its subsidiary performance. In the first essay, I tested my arguments on a sample of 22,902 foreign subsidiaries of 4,253 Korean MNEs in 60 countries in 2012, 2014, and 2016. The second and third essays used a sample of 3,830 and 3,832 foreign subsidiaries of 475 Korean firms operating in 46 countries from 2011 to 2016.