Multinational Corporations

Good or Bad?
Veranika Slavuta , Kristina Cekanauskaite

Contents

What is MNC?
Advantages of MNCs
Disadvantages of MNCs
Conclusion

Questions

Which multinational corporations do you know?

Multinational Corporations

Questions

Which multinational corporations do you know?

How do you think, from which industries MNC dominating the
world market now?

http://www.forbes.com/global2000/list/#tab:overa
ll

Largest Multinational Corporations

2015

Largest Multinational Corporations

2015

Largest Multinational Corporations

2015

Questions

Which multinational corporations do you know?

How do you think, from which industries MNC dominating the
world market now?
Do you think it was somehow different few years ago? Were
there other MNCs on the top?

Advantages

Economic development
Technology transfer
Workplace creation
Lower costs of production
Research and Development
Minimum standards
Corporate social responsibility

CSR
Google purchases or produces 24% of renewable energy
In Mountain View campus 1.9 MW solar panels generate more than 3 million kWh clean
energy
The company has been carbon neutral since 2007
Employee relations

Corporate social responsibility

The Walt Disney Company is one of the largest and most well-known
corporations practicingCSR:
Environment
Community

focusing heavily on volunteerism

Labor standards

Disney supports local economies by contributing significant tax revenue and by

consuming local goods and services

Disadvantages

Market dominance of MNCs

Pushing local firms out of a business

Disadvantages

Environmental threat
Volkswagen scandal
British Petroleum

Environmental threat
Volkswagen scandal 2015:
11 million cars worldwide fitted with its defeat devices
Switzerlandbanned sales of VW diesel cars
Almost 1.2 million VW diesel vehiclesin the UK are affected by the scandal
VW said it willrecall 8.5 million diesel carsacross Europe
South Koreaordered a recall of 125,522 VW cars

Environmental threat

British Petroleum disaster 2010:

Roughly 3.2 million barrels (134 million gallons) of crude oil spilled over the course
of 87 days, staining 1,100 miles of coastline
The immediate impacts were severe, with oil-soaked birds, fish, and turtles
washing up on shore along the coast.

Disadvantages

Loss of natural resources:

Indonesia example: two of the largest pulp and mills producers
170,000 hectares of natural forests

Disadvantages

Exploiting the workforce

Nike
Walmart
Levi

Nike sweatshop

Disadvantages

Affects on Economic Development of The Third World

Countries:
Overuse its power on local government: hostile policies towards MNCs

Economic Development of The Third

World Countries

GDP:
Uganda = $27 billion (2014)
Chile = $258.1 billion (2014)
Lithuania = $48.35 billion (2014)

Population/ employees:
Chile: 18.056.201 people
Royal Dutch Shell: 94.000 employees

Royal Dutch Shell revenue (2015): $420.6 billion

ExxonMobil profit (2015): $32.52 billion

Disadvantages

Profits usually not kept in the host country

General Motors

Disadvantages

Corporate social responsibility overlooked

British American Tobacco

Disadvantages

Relaxed health and safety requirement (laws) and little if

any environmental laws may be in place
Exploitive type of MNEs

Disadvantages

Neglecting home industrial and economic development

Intel and Apple

Intel and Apple

Silicon valley:
Intel: 12,500 employees
Apple: 25,000 employees

Faxconn (southern China): 250,000 employees

for Apple products

Conclusion

MNCs good or bad?

Resources
http://www.economicshelp.org
http://www.osstf.on.ca/adx/aspx/adxgetmedia.aspx?docid=8136
http://www.businessnewsdaily.com/5499-examples-socially-responsible-businesses.html
http://www.economicshelp.org/blog/538/economics/multinational-corporations-good-or-bad/
CSR http://
www.businessreviewusa.com/leadership/3827/The-Walt-Disney-Company-A-Leader-In-Corporate-So
cial-Responsibility
Volkswagen
http://www.theguardian.com/business/2015/dec/10/volkswagen-emissions-scandal-timeline-even
ts
Levi and WalMart http://www.law.harvard.edu/programs/lwp/NLC_childlabor.html
Indonesia http://
www.thejakartapost.com/news/2010/10/22/how-mncs-threaten-our-environment.html#sthash.oj
fCZBMz.dpuf

Resources

BP
http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/7783656/BP-disaster-worst-oil-spil
l-in-US-history-turns-seas-into-a-dead-zone.html
Royal Dutch Shell http://www.forbes.com/companies/royal-dutch-shell/
http://www.shell.com/about-us/who-we-are.html

ExxonMobil http://www.forbes.com/companies/exxon-mobil/
Nike http://www.businessinsider.com/how-nike-solved-its-sweatshop-problem-2013-5
Uganda http://data.worldbank.org/country/uganda
Chile http://data.worldbank.org/country/chile
http://countrymeters.info/en/Chile