Seminar Topic on Mnc

Amultinational corporation(MNC) ormultinational enterprise(MNE)1is acorporationenterprise that manages doingor deliversservicesin more than one country. It can also be referred to as an outside(a) corporation. They play an important role inglobalization. Strategies Corporations may bring out aforeign direct investment. Foreign direct investment is direct investment into one country by a company in production located in another(prenominal) country either by buying a company in the country or by expanding operations of an actual business in the country. 23 Asubsidiaryor daughter company4is acompanythat is completely or partly owned and wholly controlled by another company that owns more than half of the subsidiarysstock. 56 A corporation may choose to locate in aspecial economic zone, which is a geographical area that has economic and other laws that are more exculpate-market-oriented than a countrys typical or national laws. editCommunication in the midst of different cultures M ultinational corporations need to deal with different cultures of their employees, partners, suppliers and customers.Cross-cultural chat(frequently referred to asintercultural communication) is a field of study that looks at how people from differingculturalbackgrounds communicate, in similar and different ways among themselves, and how they endeavour tocommunicateacross cultures. Intercultural competenceis the ability of successfulcommunicationwith people of othercultures. A person who is interculturally competent captures and understands, ininteractionwith people from foreign cultures, their specific concepts inperception, thinking, smelling and acting.Earlier experiences are considered, free fromprejudices there is an interest andmotivationto continuelearning. editConflict of laws Main articleConflict of laws Conflict of lawsis a set of procedural rules that determines which legal system and whichjurisdictionsapplies to a given conflict. The termconflict of lawsitself origina tes from situations where the ultimate outcome of a legal dispute depended upon which law applied, and the common law courts manner of resolving the conflict between those laws. Incivil law, lawyers and legal scholars refer to conflict of laws as private international law.Private international law has no real connection withpublic international law, and is instead a feature of local anaesthetic law which varies from country to country. The three branches of conflict of laws are * Jurisdiction whether the forum court has the power to resolve the dispute at hand * Choice of law the law which is being applied to resolve the dispute * Foreign heads the ability to recognize and enforce a judgment from an external forum within the jurisdiction of the adjudicating forum editGlobalizationMultinational corporations are important factors in the processes ofglobalization. National and local governments often compete against one another to commit MNC facilities, with the expectation of in creasedtaxrevenue, employment, and economic activity. To compete, political entities may offer MNCsincentivessuch as tax breaks, pledges of governmental assistance or subsidized infrastructure, or laxenvironmentalandlaborregulations.These ways of attractingforeign investmentmay be bumpd as arace to the bottom, a push towards greater self-direction forcorporations, or both. MNCs play an important role in developing the economies of developing countries like investing in these countries provide market to the MNC but provide employment, plectrum of multi goods etc. On the other hand, economistJagdish Bhagwatihas argued that in countries with comparatively low labor costs and weak environmental and social protection, multinationals actually bring more or less a race to the top. While multinationals will certainly see a low tax burden or low labor costs as an element of comparative advantage, Bhagwati disputes the existence of evidence suggesting that MNCs deliberately avail themselve s of lax environmental regulation or poor labor standards. As Bhagwati has pointed out, MNC profits are tied to operational efficiency, which includes a high degree of standardisation. Thus, MNCs are likely to adapt production processes in many of their operations to conform to the standards of the most austere jurisdiction in which they operate (this tends to be either the USA, Japan, or the EU).As for labor costs, part MNCs clearly pay workers in developing countries far below levels in countries where labor productivity is high (and accordingly, will adopt more labor-intensive production processes), they also tend to pay a premium over local labor rates of 10 to 100 percent. 7Finally, depending on the nature of the MNC, investment in any country reflects a desire for a medium- to long-term return, as establishing plant, training workers, etc. , can be costly.Once established in a jurisdiction, therefore, MNCs are potentially vulnerable to arbitrary government intervention such as expropriation, sudden contract renegotiation, the arbitrary withdrawal or compulsory purchase of licenses, etc. Thus, both the negotiating power of MNCs and the race to the bottom critique may be overstated, while understating the benefits (besides tax revenue) of MNCs becoming established in a jurisdiction. editTransnational CorporationsA Transnational Corporation (TNC) differs from a conventional MNC in that it does not identify itself with one national home. Whilst traditional MNCs are national companies with foreign subsidiaries,8TNCs spread out their operations in many countries sustaining high levels of local responsiveness. 9An example of a TNC is Nestle who employ of age(p) executives from many countries and try to make decisions from a global perspective rather than from one centralized headquarters. 10However, the terms TNC and MNC are often used interchangeably. editCriticism of multinationals Main articlesAnti-globalizationandAnti-corporate activism Anti-corporate a dvocates criticize multinational corporations for entering countries that have lowhuman rightsor environmental standards. 11They claim that multinationals give rise to huge merged conglomerations that reduce competition and free enterprise, raise capital in host countries but export the profits, exploit countries for their natural resources, limit workers wages, erode traditional cultures, and challenge national sovereignty.