4.4 Flashcards
1
Q
impact of MNCs (locally)
A
- generate jobs
- opportunity for development of skills
- increased wages and working conditions
- increased demand for labour= more competition for skilled workers
- infrastructure
- social enterprise
2
Q
impact of MNCs (internationally)
A
- FDI flows
- technology and skill transfer
- consumer benefits
- culture
- transfer pricing
3
Q
how do MNCs impact FDI?
A
- leads to spending in the economy,
- creates jobs,
- lowers level of unemployment
4
Q
how do MNCs impact technology and skill transfer?
A
- train/develop knowledge and skills
- may develop local industries and improve competitiveness
5
Q
what benefits do MNCs bring to consumers?
A
- lower prices
- more choice
- improved quality
- better living standard
6
Q
what is the impact of MNCs on transfer pricing?
A
- an MNC will ensure it is selling its products through a country with the lowest tax levels
- often operate across countries
7
Q
impact of increased global ethics?
A
- greater pressure to act ethically, but greater scope to break ethical codes
- whats considered ethically acceptable in one country may not in another
8
Q
global ethics and stakeholders: governments and NGOs:
A
- will place pressure on MNCs to ensure they pay correct levels of tax
9
Q
global ethics and stakeholders: shareholder:
A
- seek the greatest return on their investment and profit maximisation
10
Q
global ethics and stakeholders: customers:
A
- increasingly conscious of where their products come from, focus on ethical sources
11
Q
global ethics and stakeholders: communities:
A
- negative impacts such as pollution, cause bad publicity
12
Q
ethical business practices may relate to:
A
- acceptable pay levels: ‘living wage’
- suitable working conditions
- human rights, no inhumane treatment
13
Q
environmental considerations:
A
- Some legislation’s don’t exist is LEDCs
- Legislation on how businesses dispose of and manage waste may also not be enforced rigorously in some countries
- can impact costs and conflict with profit for some MNCs
14
Q
supply chain considerations:
A
- Difficult to know if workers have been exploited somewhere down the supply chain, e.g. use of child labour
- Makes it easier for MNCs to hide unethical behaviour
15
Q
unethical marketing practices may include:
A
- misleading labelling/packaging
- false claims in advertising
