Multinational Companies are the giant companies having their origin in one country and running their operations in more than one country. The Indian economy is one of the fastest growing economies in the world which offers a huge market to the multinational companies. A multinational corporation can be termed as an organization that manages production and delivers its services in more than one country.Role of Multinational Companies MNCs (part 1)
A company can only be called as an MNC if it has subsidiaries in foreign lands, whose assets and revenue are meant for global operations, and its stakeholders are from different countries. Such enterprises maintain, create employment, create wealth and improve technology in countries. These either can be a horizontally integrated, diversified or vertically integrated multinational corporation which may engage in a variety of different businesses. Plus having MNCs subsidiaries in the home country has its benefits too, such as the acquisition of raw materials from abroad, adoption of technological expertise from the global markets, Exports of components and finished goods, inflows of income from overseas profit, management contracts, royalties, etc.
Due to the presence of high demand and potential many multinational companies are coming to India to expand their business. Here is the list of Top 10 Multinational Companies in India.
It develops and sells computers, laptops, softwares and online services. Apple is a world renowned consumer electronics company and some of its best known products are iPhone, iPad, iPod and Mac line of computers.
Microsoft Corporation India is a subsidiary of Microsoft Corporation, an American multinational company incorporated in the year It has contributed tremendously in the development of technology and is the leading company in India for providing operating system for computers, laptops, tablets and mobile phones. This electronics pioneer offers business spread across four units, viz.
Its products and services in India include IT services, business consulting, application management, servers and storage solutions.
What is a Multinational Company?
Watson and Charles Ranlett Flint. Next is Nestle India, a part of Nestle S. A, a Switzerland based food and beverage company. Nestle made debut in India in by selling imported products and is presently a leading food and beverage company in India. It started its operations in India in the year and presently serves customers with products like Gillette, Vicks, Olay, Pantene, Ariel, Tide, etc.
Citigroup made debut in India in through its subsidiary, Citibank, which presently has more than 40 branches in over 30 cities in India. PepsiCo is another American company in this list, which manufactures snack foods, beverages and other products.Presence across one more geography allows the generation of higher revenues for the MNC.
Apple inclusive is one of the biggest companies as per market capitalization. The product of apple is available everywhere.
Apple purchases its hardware from china and technology from India. The raw materials and labor required for mobile and computer hardware are cheapest in china compare to the U. Whereas, the cost of the software developer is cheapest in India. Thus, Apple is sourcing its raw materials and technologies from different part of the world and selling at the same rate. Though the pricing is made as per the U. Thus, the company is making maximum profits by producing at a nominal cost, in terms of U.
Unilever is a consumer discretionary company having headquarter at Amsterdam, Netherland. The company has a presence across the U. The company opened subsidiaries in each country and controls from its local country. The products of HUL are almost the same and is available everywhere across the world. The motive of the business is not cheap sourcing or taking any resource advantages, but to get expansion from the entire world, the company has subsidiary at every place.
However, the price of the product is not the same across the globe. The price has been fixed as per the currency and economic condition of that country. In the era of globalization, business firms can adopt different policies for creating wealth.
Through this, the cosmopolitan culture has evolved during the last two-three decades. This has been a guide to what is the multinational company and its definition.
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View Course. Leave a Reply Cancel reply Your email address will not be published.The event was put on by the Great Place to Work Institutewhich determined the list by surveying 2. Great Place to Work determined rankings based on the average score from surveys sent to employees.
Countries must be mentioned on lists from at least five countries to be considered a best multinational company. The beverage maker was named as a great work place in lists from Argentina, Australia, Brazil, Chile, Peru, and Spain. The pharmaceuticals company was named in lists from Italy, Mexico, Switzerland, the Netherlands, and the United States. Great Place to Work Institute determined rankings based on the average score from surveys sent to employees.
The information technology company and internet service provider was mentioned on lists from Australia, Brazil, Canada, India, Japan, and the United States.
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My Account. World globe An icon of the world globe, indicating different international options. Abby Rogers. Just in case you aren't looking for something global.A multinational companyknown more commonly as a multinational corporation or transnational corporation in North America, is a business with branches, offices or production facilities in more than one country.
Multinational Corporation (MNC)
However, if all that foreign business comes purely from exports and the company has no offices, premises or production facilities abroad, it is not a multinational. To gain new markets — a business may find that it has reached saturation point at home and needs to find new markets.
Initially, they may begin by exporting to other nations, but eventually will set up production, distribution and sales facilities abroad. Lower costs — the cost of labor and land may be lower abroad. Businesses are always looking for ways to increase profits; lowering costs is one way of achieving this. A car-factory worker in Mexico, for example, earns less than one-sixth per hour than his or her US counterpart. To avoid tax — different countries have varying levels of corporate tax. By setting up abroad, a company may be able to reduce its tax bil.
To overcome trade barriers — some countries are protectionist and will only let overseas businesses access their markets fully if they manufacture their products locally. Government grants — in the s, for example, the UK government attracted many overseas companies by offering them financial incentives.
There are literally thousands of multinationals across the globe. This is a list of just a few. Anti-multinational advocates say these giant entities enter countries with low human rights and environmental standards and operate in ways they are not allowed to back at home or in the advanced economies.
There is also apprehension that multinational corporations might have too much influence on politicians and government policy, for example, by threatening to reduce the number of jobs in a country and move them elsewhere if decisions do not go their way. As they operate in several different nations, with varying tax systems, multinationals are today criticized by the press for paying much less tax than they allegedly should.
They are accused of setting up sophisticated networks of subsidiaries and associated businesses in countries with extremely low rates of tax, such as Luxembourg, and through legislation loopholes in major economies devise ways to dramatically reducing their tax bills.
Smaller companies say this makes it much harder for them to compete. According to Tax Justice Networkan advocacy group:. They hold trillions of dollars of untaxed or hardly taxed profits offshore — and The sums are growing fast. Multinational companies MNCs offer the host country several benefits. By operating in a country, investment, employment and income levels increase. Management expertise enters the host nation, which over the long term spreads as local people learn about it.
MNCs create competition and break local monopolies. Economists say this makes local competitors try harder, which leads to superior products and services. MNCs generally offer better pay than local employers in low-income and emerging nations.A corporation which has possessions and other facilities in at least one country other than its home country can be called as a MNC or a Multinational Corporation.
These companies can also be called stateless companies, as they are not concentrated on a single state. The actions of these companies are towards a free market, without any boundaries and restrictions, and economic liberalism. Initially Multinational Companies were built for the purpose of control of trade on the slave country by its master.
Listed below are the top 10 multinational companies in the world Autodesk is an American MNC which produces software for architecture, drawings, engineering, construction etc. One of the most widely used architecture or drawing software of the company is AutoCAD. It is taught in colleges and is one of the highest downloaded software.
The company employs over people. The other famed software of the company are 3ds Max, Revit, Pixlr and Sketchbook. Diageo is a multinational company based in London, UK. It is an alcoholic beverage manufacturer. It is the largest producer of beer in the world. It has offices in around 85 countries and has market in countries.
It was founded in and employs around people. This is an US based multinational company famous for the products it manufactures from fluoro-polymers. It has its headquarters in Newark, Delaware. It was founded in by Bill Gore. The first product from the company was insulated wires using PTFE.
List of multinational corporations
The company employs people. FedEx is the acronym of Federal Express.A multinational corporation MNC has facilities and other assets in at least one country other than its home country. These companies, also known as international, stateless, or transnational corporate organizations tend to have budgets that exceed those of many small countries.
A multinational corporation, or multinational enterprise, is an international corporation that derives at least a quarter of its revenues outside its home country.
Many multinational enterprises are based in developed nations. Multinational advocates say they create high-paying jobs and technologically advanced goods in countries that otherwise would not have access to such opportunities or goods. However, critics of these enterprises believe these corporations have undue political influence over governments, exploit developing nations, and create job losses in their own home countries.
The history of the multinational is linked with the history of colonialism. Many of the first multinationals were commissioned at the behest of European monarchs in order to conduct expeditions. Many of the colonies not held by Spain or Portugal were under the administration of some of the world's earliest multinationals. It was headquartered in London, and took part in international trade and exploration, with trading posts in India. Other examples include the Swedish Africa Company, founded inand the Hudson's Bay Company, which was incorporated in the 17th century.
There are subtle differences between the different kinds of multinational corporations. For instance, a transnational—which is one type of multinational—may have its home in at least two nations and spread out its operations in many countries for a high level of local response.
Meanwhile, a multinational enterprise controls and manages plants in at least two countries. This type of multinational will take part in foreign investment, as the company invests directly in host country plants in order to stake an ownership claim, thereby avoiding transaction costs.
Apple Inc. There are a number of advantages to establishing international operations. Having a presence in a foreign country such as India allows a corporation to meet Indian demand for its product without the transaction costs associated with long-distance shipping.
Corporations tend to establish operations in markets where their capital is most efficient or wages are lowest. By producing the same quality of goods at lower costs, multinationals reduce prices and increase the purchasing power of consumers worldwide. Establishing operations in many different countries, a multinational is able to take advantage of tax variations by putting in its business officially in a nation where the tax rate is low—even if its operations are conducted elsewhere.A multinational corporation MNC is a corporate organization that owns or controls production of goods or services in at least one country other than its home country.
Most of the largest and most influential companies of the modern age are publicly traded multinational corporations, including Forbes Global companies. Multinational corporations are subject to criticisms for lacking ethical standards.
They have also become associated with multinational tax havens and base erosion and profit shifting tax avoidance activities. A multinational corporation MNC is usually a large corporation incorporated in one country which produces or sells goods or services in various countries. MNCs may gain from their global presence in a variety of ways. The problem of moral and legal constraints upon the behavior of multinational corporations, given that they are effectively "stateless" actors, is one of several urgent global socioeconomic problems that emerged during the late twentieth century.
Potentially, the best concept for analyzing society's governance limitations over modern corporations is the concept of "stateless corporations". Coined at least as early as in Business Weekthe conception was theoretically clarified in that an empirical strategy for defining a stateless corporation is with analytical tools at the intersection between demographic analysis and transportation research.
This intersection is known as logistics managementand it describes the importance of rapidly increasing global mobility of resources. In a long history of analysis of multinational corporations we are some quarter century into an era of stateless corporations - corporations which meet the realities of the needs of source materials on a worldwide basis and to produce and customize products for individual countries.
One of the first multinational business organizations, the East India Companywas established in When a corporation invests in the country which it is not domiciled, it is called foreign direct investment FDI. In addition, corporations may be prohibited from various business transactions by international sanctions or domestic laws.
For example, Chinese domestic corporations or citizens have limitations on their ability to make foreign investments outside of China, in part to reduce capital outflow. International investment agreement s also facilitate direct investment between two countries, such as the North American Free Trade Agreement and most favored nation status.
Multinational corporations can select from a variety of jurisdictions for various subsidiaries, but the ultimate parent company can select a single legal domicile ; The Economist suggests that the Netherlands has become a popular choice, as its company laws have fewer requirements for meetings, compensation, and audit committees,  and Great Britain had advantages due to laws on withholding dividends and a double-taxation treaty with the United States.
Corporations can legally engage in tax avoidance through their choice of jurisdiction, but must be careful to avoid illegal tax evasion. Corporations that are broadly active across the world without a concentration in one area have been called stateless or "transnational" although "transnational corporation" is also used synonymously with "multinational corporation" but as ofa corporation must be legally domiciled in a particular country and engage in other countries through foreign direct investment and the creation of foreign subsidiaries.
Multinational corporations may be subject to the laws and regulations of both their domicile and the additional jurisdictions where they are engaged in business. As ofthe United States and most OECD countries have legal authority to tax a domiciled parent corporation on its worldwide revenue, including subsidiaries;  : as ofthe US applies its corporate taxation "extraterritorially",  which has motivated tax inversions to change the home state.