Strategically Multinational Companies (MNC) want strategic autonomy and freedom.  I find this amusing as the rest of us want this as well.  However, when MNC gain contractual control of public assets this can mean a reduction of autonomy, freedom of speech not only for the public but for the government as well. When I studied strategic marketing it was evident that there were strategies to buy up the marketing channels to keep costs down and maximise control of product quality.  The idea of sourcing componentry from around the world is a strategy to keep costs down by using cheap labour.  The product is compiled in the one place but MNC’s straddle the world. Given their size they have access to government readily and government given economic imperatives will work with them as employment and economic activity results and this is good for re-election.  So the relationship between business and government is intimate.  We saw clearly in the United States the political/business nexus was a revolving door from industry to politics and politics to industry as government was infiltrated by business interests given government saw its interests as the same. The question of who do governments represent is the key question of our time and how business influences society and the future is demonstrating concerning trends in respect of ICT as a means of data capture, surveillance, marketing, personalisation and information delivery without any real critique.

There is a constant tension around regulation and deregulation as business regards this as a cost.  However, externalities (external pollution, extraneous harms) require regulation to ensure health and safety.  There have been many examples of company pollution, spills, gas releases, fracking, labour conditions, rainforest timbers, GMO’s, chemical compounds, CO’2 emissions and the list goes on, which warrant a balanced and neutral regulation of companies and multinationals.

My rationale does not negate the good companies do, the individual leadership of some amazing CEO’s, the innovation, progress, technological advances that have been made.  Nor do I disagree that there would be fair cases for less regulation (red tape), bureaucracy and less interference but it would be on a case by case basis.  Like any human activity it has to be regulated as morality and values are not centre stage, profitability becomes the carrot that all follow, often at the expense of the people and the environment. It is the nature of capitalism to increase profit.  It is not designed to consider social needs unless that profits in some way e.g. Corporate Social Responsibility as part of a marketing effort.  Psychologically the corporation operates as a psychopathic entity with no social emotional consideration.  It is the nature of business.

So I do perceive two sides but balance and caution is a wise strategy when it comes to multinational control and agreements that restrict wellbeing, justice and fair play in any form.

A notable quote from below:

“In the long run,” commented a top manager of one MNC confronted by just this kind of threat, “we risk becoming a collection of inefficient government–subsidized national companies unable to compete on the world market. Yet, if we rationalize our operations, we lose our preferential access to government contracts and our R&D subsidies. So we try to develop an overall strategic plan that makes some competitive sense, and then we bargain for each part of it with individual governments, trying to sell them on the particular programs that contribute to the plan as a whole. Often, we have to revise, or abandon, parts of our plan for lack of government support…”

Another quote in the conclusion:

“…the kind of counteractive response an MNC can select depends primarily on the company’s bargaining power vis-à-vis the host government as well as on its competitive posture within its own industry. In fact, it may be of use to picture these choices of counteractive response as lying at various points along a spectrum defined by MNC bargaining power…”

This article is written with a specialist focus on the needs of Multinational Companies given the author’s expertise.  My comments are reflections as I utilise this article to gain a sense of the thinking of multinationals and their needs and how this impacts the sovereignty of governments.

This is from the Harvard Business Review.

https://hbr.org/1980/03/how-mncs-cope-with-host-government-intervention

How MNCs Cope with Host Government Intervention