Thought Leadership

Multinational companies from emerging markets should align their sustainability reports and actual impacts. Global expansion (especially to more economically advanced markets) can help emerging market multinationals learn best practices for aligning their sustainability communications (i.e., “talk”) and impacts (i.e., “walk”).

Multinational companies hold significant power and influence in the less economically advantaged countries in which they operate. For instance, when accused of contributing to human rights violations in Thailand, Nestlé responded by launching a training program and other initiatives to eliminate forced labor from their supply chain. This suggests that multinationals can, in fact, help address the developmental needs of the poorer countries where they have economic interests by promoting sustainable development practices in their operations.

Climate change, extreme poverty, and social inequality are just a few of the global societal challenges of our time. As societies wrestle with these issues, multinational companies can choose to be part of the solution and use their influence to bring about positive change. By implementing the United Nations' 17 Sustainable Development Goals into their operations, they can maximize their positive impacts and minimize harm.

New multinational corporations from emerging markets have begun to compete fiercely with old multinationals from developed countries. Each type of multinational possesses unique strengths and weaknesses, and the weaknesses of one happen to be the strengths of the other. Global success will depend on the speed at which each type of multinational can learn and build new capabilities in areas where it is weak. To win this learning race, Western multinationals must guard against hubris and be willing to reexamine traditional strategies and practices.

Companies acquire third-party certifications, such as ISO certificates, to authenticate the quality of their products and services. But do these certifications really make a difference? Research indicates that while companies from developing markets seek these certifications more than those from more economically advanced institutional environments, the latter usually enjoy greater benefits from their adoption. This is largely because the products and services of companies from developing markets are often negatively stereotyped by consumers, because of their negative perceptions about these companies' countries of origin. Importantly, this distortion is less prominent for companies that operate in more established industries.

As the Russian invasion of Ukraine extends into its fourth week, its effect on global supply chains—already beleaguered by the COVID-19 pandemic—is only just beginning. “This is going to have a significant impact,” says Nada Sanders, distinguished professor of supply-chain management at Northeastern. “I'm extremely concerned.”

The invasion of Ukraine has raised concerns that Russia may launch a cyberwar against the west. In recent years, cyberattacks have become more frequent, wreaking havoc on organizations around the world. Even the largest multinationals cannot escape the risk that such attacks pose to their longer-term viability.

Moscow's famed cyber prowess may not be as sophisticated as people believe, say Northeastern experts. And, Russia may not have the appetite to launch a digital war on top of a traditional one with tanks and bombs. “They don't want a war on two fronts if they don't have to,” says global strategy professor Luis Dau.

Spencer Fung, who runs a Hong Kong-based supply-chain manager, spoke to Northeastern students about the future of the global supply chain as businesses contend with a host of disruptions—from the continued rise of e-commerce to the COVID-19 pandemic.