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Chapter 8: The Future of the Transnational: An Evolving Global Role by Mind Map: Chapter 8: The Future of the
Transnational: An Evolving Global
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Chapter 8: The Future of the Transnational: An Evolving Global Role

Impression in some countries: Globalization = Exploitation

Important protests in 1999 in Seattle against the WTO's new trade regulations Rich nations protect themselves, drive out competition in emerging markets and then exploit their monopoly




Reasons why 3rd world aid has failed

1st world countries had patronizing view

No accountability

No feedback

Just throwing money at the problem instead of using local market economies

The latter is how China and India gained power

MNE Postures to Respond to Developing World Needs

The Exploitive MNE

Cross-country differences in wages, working conditions... are opportunities for competitive advantage Some try to avoid criticism by outsourcing production to other suppliers but that no longer suffices Firms can just move on to another country when the criticism becomes too much Accept no responsibility for the social or environmental consequences of their actions NGO's are their enemies

The Transactional MNE

Doing Deals, Respecting Laws The minimum attitude expected from MNE's today Willing to adapt to local preferences in a minor way as long as there is an economic benefit to it Better treatment of employees but still putting pressure on them Obeys laws without exploiting loopholes NGOs no enemies but rather monitors and challengers At least doesn't do any harm

The Responsive MNE

Making a Difference Sustainability becomes more important: Long-term viability of companies in the economic and social system Sensitive to the needs of different stakeholders in developing countries Feels need to be a good corporate citizen that has a positive impact on its community

Many Responsive MNEs signed the Global Compact

The Transformative MNE

Leading Broad Change Wants to go beyond just being a good corporate citizen and take a leading role in helping developing nations Chooses investments that help developing nations despite there being economically better alternatives Sometimes even makes products available to consumers who can't pay for them "Agents of Change" NGOs are regarded as partners