Multinational Corporations And The Political Stability Essay

Typically, a multinational corporation develops new products in its native country and manufactures them abroad, often in Third World nations, thus gaining trade advantages and economies of labor and materials. Almost all the largest multinational firms are American, Japanese, or West European. Such corporations have had worldwide influence—over other business entities and even over governments, many of which have imposed controls on them. During the last

China, indeed, was successful in pursuing foreigners to invest in their country; thus the rise of joint-owned ventures and multinational corporations or MNCs. Soon enough, China’s business industry was dominated mostly by multinational corporations. Through the establishment of MNCs, a lot of employment were created. Alongside MNCs however, are pressing controversial issues involving violation of human rights, labor code, and country policies as well as its involvement in environmental degradation.

A country analysis project must be analyzed in the context of its political, legal, economic, social, and cultural environments-the investment climate of the target country. Although sensitivity to particular factors varies from one project to another, all analyses are subject to the influence of some set of specific factors. Therefore a firm should raise three questions about a country's investment climate: (1) How the investment climate will be critical to the success of the project? (2) What is the present value of these critical issues? (3) How are these issues likely to change over the investment planning period? In making domestic investment decisions, firms should pay much attention to the relative

Multinational corporations are organizations that work in numerous nations. They likewise help to keep up the worldwide predominance of the Industrialized Nations just by working together sustaining universal stratification. MNC may have a few premiums like overseeing mining operations in a few nations, fabricating merchandise in others, and market its items around the world. The essential recipients are dependably the Industrialized countries, particularly the one in which the multinational partnership has its reality home office. In their quest for benefits, the multinational corporations require helpful power elites at all industrialized countries. The MNC dependably require positive business atmosphere in type of low

Governments might change or new political parties might be elected, but the concern of the multinational corporation is the continuity of the set of rules or codes of behavior and the continuation of the rule of law—regardless of which government is in power.

Analysts agree that TNCs have altered the international relations principles that were once dominated by nation-state relations (Kline, 2005).Transnational Corporations have in many ways exploited the weaknesses in the territorially guarded national laws. In many developing countries, organizations affiliated to external control have challenged and in some instances threatened government sovereignty. Economically stable countries such as the United States of America, have attempted to extend their influence to other countries of the world through TNC. This situation is what led to governments endorsing the non-interference policy in national political affairs (United Nations, 2003). Interesting to note is the role that non-governmental organizations played in this debate. Nongovernmental organizations have been known to not only exert political pressure on governments with little democratic space, but also collaborate with TNCs in this quest. (Heinrich, 2001). For example, many NGOs sort the active involvement of TNC in removal of the apartheid regime in South Africa. This in return, has created tension between these governments and the NGOs with the NGOs calling for the increased political involvement of the TNCs.

For several decades, literature has suggested that multinational corporations (MCNs), transnational corporations (TNCs), and or international business companies (IBCs), are among the most powerful and wealthiest organizations in the history of the world (Tirimba & Macharia, 2014; Bouquet & Birkinshaw, 2008; Fuchs, 2007; Cohen, 2007; Stopford, 1998; Meleka, 1985; Hawkins, 1979).

Two important issues Adler focuses on within the essay are; the nationality of their investment projects and financing sources and whether they depend on the structure of the corporation itself. Can a multinational corporations use the planning objectives structure of the parents and its subsidiaries if the ownership of the corporation is multinational?

Under a global environment, sometime it becomes necessary for an organisation to have an international view. For those companies who want to enlarge their size or expand their market, they may consider investing abroad as a possible choice. Usually, the decision is made under a proper estimation. But since there are many risks in a foreign environment, it may be hard for the company to make an evaluation. Basically Investors decide where to invest based on their perceived economic risks, political risks, and legal risk (Sandler and Enders 2004). So this essay will evaluate how these risks affect organisations decision when they want to invest abroad, try to find out whether there are good ways that company can use to reduce the effects of these risks and make a suitable decision.

In 1291, the Swiss Confederation was founded. In 1499, the Swiss Confederation obtained independence from the Holy Roman Empire. Finally, in 1848, a constitution was created that replaced the confederation with a centralized federal government. Today, the Swiss Confederation is most commonly known as Switzerland, one of the world’s richest and most innovative countries (The World Factbook: SWITZERLAND). In efforts to determine whether our firm should pursue business engagements in Switzerland, I, Paula Cuerquis, Senior Macroeconomist at our multinational corporation, created a report that outlines the overall macroeconomic conditions of the country of interest. In this report, I will be providing an assessment of Switzerland’s current

This chapter argues that besides democratic institutions in a country, there are other factors that that multinational corporations take into consideration before deciding whether to invest in a country or not. The author refers to this other factor(s) as veto players which he describes as either being individual or collective actors and whose approval warrants policy change in a state.

To begin with, legal and economic hurdles are some of the most significant problems MNEs seeking to further enhance their global presence encounter. Each and every country conducts its political, legal, and economic undertakings in a unique way. For this reason, MNEs seeking to exploit opportunities in emerging markets have to contend with various taxation, institutional, as well as legal challenges that effectively make their forays into the said markets even more complicated. MNEs also encounter problems in regard to language differences. This is more so the case given the relevance of effective communication in business transactions. Cultural differences could also make internationalization much more challenging. Some of the largest multinational corporations with operations across the globe include but they are not limited to Gillette, Pampers, and Coca-Cola. These three companies according to Gitman and McDaniel (2008) rake in more revenues from their global operations than they do from their home markets. In addition to saving significant sums of money in labor costs, multinational corporations according to Gitman and McDaniel (2008) can also be able to further enhance their operations by taping new technology from across the world.

The pursuit of the bottom line is the goal of many businesses of a variety of sizes. The ability to buy cheaply, sell dearly and minimize costs across the board gives businesses an edge that allows them to create vast amounts of wealth for those with a stake in the business or corporation, but at what cost? Multinational corporations create great deals wealth but they propagate social and cultural inequality, poverty and environmental damage at rates to rival their gains. Multinational Corporations wield incredible amounts of political and economic clout, clout that allows them to manipulate a region without fear of recourse on the part of the localities in which they reside. The gains of corporations with respect to political and economic

Moreover, these companies are also ready to move their production bases to another country or to layoffs and downsizing their companies if their business are unsuccessful. It causes tremendous equality between the companies and the countries that have been investing. Despite the advantages of an investment may entail technology transfer, production and employment in the country, it has the effect of trade liberalization on that companies can easily withdraw the investment. Including, technology transfer in production to those subsidiaries have been inherited by these companies are not absolutely perfectly. It could be that the relationship between the parent company and subsidiaries is the parent company control and plays a major role over the subsidiaries and based on the pursuit of profit as much as possible. This essay will provide the examples of two big companies which focus on multinational enterprises in different continents which have high turnover but on the other hand, there are problems that arise from the operation of these companies, as well as the impact on third parties that may lead to reduce the credibility of companies. The samples have to be taken into consideration and analysis in perspective of foreign investors, civil society actors and the reaction of government actors as well.

A multinational corporation is an organization headquartered in one nation that that has operations in one or several foreign nations to leverage additional market penetration (Luthans & Doh, 2012). By entering into the global market organizations essentially enter into the threshold of a multinational corporation (MNC). This paper will provide an explanation of globalization, the primary challenges of multinational management, and discuss two separate case studies and their challenges and successes.