Multinational Corporations are generally large-scale sectors which produce and sell goods in various other countries. Multinational corporations have worldwide activities and all these are controlled by parent company. There are many advantages and disadvantages of Multinational Corporation. Continue reading this article to know more about Corporate Multinationals!
Corporations are becoming multinational because it helps to develop a small business expand its size and reach to a higher level. Top 5 multinational companies are Microsoft, IBM, Amazon, Sony, Apple etc.
The various types of Multinational Corporations are: A multinational Decentralized Corporation, A Global Centralized Corporation, A Global Company, and A Transnational Enterprise. Some categories of Multinational Corporations are Horizontally Integrated Multinational, Vertically Integrated Multinational, and Conglomerate Multinational.
Importance of Multinational Corporations!
Multinational Corporations can also be called as International Corporation. A multinational corporation can help in increasing the technological growth of a country because they use various sophisticated technologies. In many devolving countries this large scale corporations help to modernize the industries and multinational corporations brings new innovation and technological advances in developing countries. Multinational corporations involve with several other countries all over the world and provide jobs around the world. It creates wealth and especially for developing countries Multinational Corporations are believed to be beneficial because it gives employment opportunities. The main aim of these corporations is to make huge profit and achieve their financial goals. Multinational corporations increases a country’s investment, income etc and through modern management and financial abilities a rapid growth is occurred in the developing or other countries. A multinational company has different offices or factories in other countries and a centralized head offices were also there in which they organize and coordinate their global management works and processes. All these leads gain to good quality products. Various disadvantages are also there, the Multinational companies want to invest in low risk areas but they demand high profits. In some developing countries multinational corporations connect and interfere with political matters. They make huge advertisement and promotional techniques of artificial demands. Sometimes they face technological difficulties because they use capital intensive technologies which do not fit completely in some needs of developing countries. They adopt strong and aggressive strategies for selling their goods. As a result it creates exploitation by adopting all means to remove their competition and dominate others. They work for their self-interest. Multinational corporations utilize and exploit the local labors by giving lower amounts, taxes and they gain huge profits. They are more focused on making profits rather than working for other developing countries. These are some negative effects of Multinational Companies.
Multinational Corporations are getting involved in Corporate Social Responsibilities. In order to gain social acceptance while operating in a society it is the duty of the organization to provide good quality products, environmental-friendly items, increasing the standard of living etc. Corporate social responsibilities are playing a huge role in maintaining social factors and help a company to get socially accepted. Few more names of Multinational Corporations are Wipro, Accenture, BMW, Asian Paints, Facebook, Coca-Cola, TCS, McDonalds, Aditya Birla Group, Siemens, Vodafone, Toyota etc.
Ethics and MNCs! Business ethics in Multinational Companies and its social responsibility factors are an important part in its strategic management processes. MNCs face various ethical issues while doing business abroad. Ethical dilemmas were imposed on MNCs because it operates in various environments such as cultural, ethical, social etc. Some ethical issues of MNCs business are child labor, sweatshops, discrimination, nepotism, human rights, corruption, ethical relativism, ethical imperialism and reciprocity etc.
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