Multinational Corporations

Topics: Multinational corporation, Developing country, Corporation Pages: 36 (11602 words) Published: January 27, 2013
Sr no| Topic | Pg no|
| IntroductionCharacteristics of MNC’sSignificance of MNC’sAdvantages & Disadvantages of MNC’sCultural Problems faced by MNC’sMarket ImperfectionInternational powersManagement Functions in MNC’sGrowth of MNC’sMNC’s and Developing WorldConsequences of MNC’s on developing countriesMNC’s in IndiaForeign Collaborations in India10 Best MNC’s all overConclusionbibliography | |

A multinational corporation (MNC) or multinational enterprise (MNE) is a corporation that is registered in more than one country or that has operations in more than one country. It is a large corporation which both produces and sells goods or services in various countries. It can also be referred to as an international corporation. They play an important role in globalization. The first multinational corporation was the Dutch East India Company, founded March 20, 1602

Such a company is even known as international company or corporation. As defined by I. L. O. or the International Labor Organization, a M. N. C. is one, which has its operational headquarters based in one country with several other operating branches in different other countries. The country where the head quarter is located is called the home country whereas; the other countries with operational branches are called the host countries. Apart from playing an important role in globalization and international relations, these multinational companies even have notable influence in a country's economy as well as the world economy. The budget of some of the M. N. C.s are so high that at times they even exceed the G. D. P. (Gross Domestic Product) of a nation. Definition

There is more universally accepted definition of the term multinational corporation. Different authorities define the term differently  
As  ILO Report 
 The essential nature of the multinational enterprise lies in the fact that is managerial Headquarters are located in one country (home country) while the enterprise carries out operations in a number of other countries as well (host countries)  

Obviously, what is meant is, A corporation that controls production facilities in more than one country, such facilities having been acquired through the process of foreign-direct investment. Firms that participate in international business however large they may be, solely by exporting or b hunting technology is not Multinational enterprises.  

The United Nations
MNCs as, Enterprises which control assets- factories, mines, sales offices and the like in two or more countries.´

The genesis of MNCs lies in transnational trading in early days conducted by the Greek, Phoenician and Mesopotamian merchants. After the fall of the Roman Empire, trade between nations become difficult. When Europe and the Middle East steeped in feudalism resulting in wars between feudal lords and church prohibited trade with Muslim States. Later on, merchants/traders of Italy established trade who were considered the fore runners of the multinational firms. The cities of Genoa, Venice, Florence and Pica became the supply depots of traders. Active transnational operations flourished with the development of banks and money lending agencies. Multinationals in the form of trading companies started in the seventeenth and eighteenth centuries. The Hudson Bay Company, the East India Company, the French Levant Company were the major transnational companies established in those days. During the nineteenth century, huge foreign investment flowed from the Western Europe to the underdeveloped countries or Asia, Africa and America. England was the leading exporter of capital, followed by France, the Netherlands and Germany. In the early twentieth century British Petroleum, Standard Oil, Ana Conda Copper and International Nickel were the major MNCs investing mainly in mining and petroleum industries. The MNCs have attained their present dominating position in the world economy through a long process of...
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