TRANSNATIONAL

COMPANIES
Pay Attention!
 S O, W H A T O N E A RT H A R E
TNC’S?
 A Transnational corporation are multi-business companies that
operate in more than one country.

 These companies are able to merge and acquire each other, to form
larger entities which end up dominating (taking over) the
international marketplace.

 Theses corporations have exceeded local, state and national

boundaries, conducting business on global scales.
LOL, I’M SURE YOU KNOW
A FEW

Ah, In case you guys are daft, which you probably are….

 Mc Donald's

 Adidas

 Shell BP

 Carrefour
 MEASURES TO ATTRACT
FDI
 FDI is the flow of capital from one country to another, in order to
gain a lasting interest in an enterprise in the foreign country.
 A depreciation in the currency means the countries wages and
production costs have fallen relative to other countries. This makes the
country more internationally competitive thus attracting more FDI.
 The host country can provide incentives e.g Lower tax, lower
barriers to entry etc.
 MEASURES TO CONTROL
TNC OPERATIONS
1. Political Influence :
 Regulations may be used to try and raise the cost for firms. Firms
which do not follow rules may face heavy fines.
 Larger, more economically powerful countries have more influence
on TNC’s.
 Some developing nations may not to put controls in the fear that
the Tnc’s may leave thus losing their source of FDI, thus their
chance of developing economically.
 KEEP LISTENING…..
2. Legal Control:
 A legal system of control Is more effective in a developed country.
The government is less likely to be corrupt and will have a greater
influence.

 The government may set standards for labour rights i.e to ensure
labourers have proper working conditions which TNC’s may not
provide.
 OMG I'M TIRED !
3. Self Regulations :
 Self regulation is when a firm monitors its own behaviour, especially
in terms of ethical and legal issues.
 It would be in the firms best interest to act ethically in order to
maintain a good public reputation.
 This is more effective when laws in the country are weak.
 Some examples include : OECD guidelines of MNC’s.
THE END !!!!!!
NOW GO HOME YOU ALL !!!
 THANK YOU ALL FOR
YOUR WORTHLESS TIME