International Business & Strategy

China's approach to inward foreign direct investment (IFDI) has remained remarkably consistent since the onset of its economic opening. While the rules governing IFDI have changed, the primary goal of improving the competitiveness of Chinese companies and the secondary goal of enhancing economic development have remained. As Chinese companies become more capable and as China declares more industries “strategic,” the space for foreign invested enterprises (FIEs) may narrow. To address this, FIEs need to demonstrate their full economic impact to make their case for continued access to the world's second largest economy.

The Middle East and North Africa (MENA) region displays distinct corporate governance trends. These differences are due, at least in part, to the influence of Sharia law and the region's varied political regimes. Research suggests that advancing gender diversity on boards, directing attention towards corporate social responsibility, increasing the transparency of corporate disclosures, and investigating different ownership models can help further align local companies with established global best practices in the corporate governance area.

In rapidly evolving emerging and transition economies such Russia, informal social networks between individuals, companies, and the government play a key role for companies' ability to gain access to information, knowledge, and power. While such informal networks help companies' profitability, they can also entail significant costs for businesses and society at large. Understanding the deep roots of today's corruption trends in Russia can help the survival of domestic and foreign companies operating in the country.

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.

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.