What Is Meant By The Globalization Of Risk?

991 Words Feb 1st, 2016 4 Pages
What is meant by the Globalization of Risk? Explain the limitations of globalization. Identify the positive aspects of globalization.
The risk that comes with globalization connects between countries, culture and businesses. In today’s society, managers have more to deal with as the idea of outsourcing and cultural differences have made things a bit complex for the parties involved. Some companies might feel going to different countries for business could become a liability. For instance, if a U.S. company goes to Japan, events like the Japanese 9.0 magnitude earthquake that killed 20,000 people could cost them. This limitation of globalization effects everyone involved. Supply chains around the world were disrupted from the manufacturing plants being shutdown. In addition to natural disasters, there are also political, economical and financial risk to consider. However, a positive aspect of globalization is that is creates jobs for the economy. For those who couldn’t work due to the lack of jobs already in their country, they can now earn money to feed their families and establish a working class. Explain the following concepts in your own words with at least two sentences:
WTO: World Trade Organization deals with the global trading rules between international governments. The overall rules must be predictable enough so that everyone involved isn’t dealing with chaotic sudden changes.
Foreign Direct Investment: FDI pertains to a company that has sole ownership or…

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