International franchising is a widespread phenomenon that has grown rapidly due to the lowering of national barriers, saturation of domestic markets and growing awareness of global brands (Elango, 2007; Thompson and Merrilees, 2001). A stream of research has focused over the last twenty years on the international franchise relationship, including research on foreign partner selection and recruitment (e.g. Altinay and Miles, 2006; Doherty, 2009), the nature of the relationship in terms of autonomy and control (e.g. Paik and Choi, 2007; Pizanti and Lerner, 2003), or specific mechanisms and competences to manage the relationship such as support to (e.g. Quinn, 1999) and monitoring of foreign franchisees (e.g. Choo, 2005), knowhow transfer (e.g. Szulanski and Jensen, 2006), and contract design and adaptation (e.g. Lafontaine and Oxley, 2004). However, there is a lack of research on how franchisors’ governance of their international franchise relationships affects their performance. In this research, we examine the governance-performance link by focusing on a specific form of international performance, namely relationship performance. The latter refers, at the broadest level, to the establishment of successful relationships with the channel partners (Beugelsdijk et al., 2009; Emden et al., 2005), here the foreign franchisees. Relationship Marketing literature offers various interpretations of relationship performance (Beugelsdijk et al., 2009). Performance can be interpreted for instance as the assessment, by either or both parties a) of the relationship itself, through concepts including relationship quality or relationship satisfaction, or b) of the relationships’ outcomes, through concepts including partner loyalty or financial returns (Palmatier et al., 2006). In this research, we focus on relationship performance from the point of view of the franchisor and approach it through the construct of relationship satisfaction. Previous research shows that relationship satisfaction is directly driven by relationship investments and governance capabilities on the seller side (Palmatier et al., 2006), here the franchisor. Furthermore, relationship satisfaction was found to have a significant positive impact on economic performance both in national (Palmatier et al., 2006) and international channels.