Book co-authored by University of Macau Professor Jean Jinghan Chen discusses challenges and obstacles faced by Multinational firms amid surging protectionism and the global pandemic, with a focus on Chinese companies outward investment
Multinational corporate governance is facing a myriad of challenges arising from geopolitical and global public health factors. A new book co-authored by University of Macau Professor Jean Jinghan Chen and Runhui Lin, from Nankai University, titled “A Theoretical Framework of Multinational Corporate Governance and Its Application to the Chinese Multinational Enterprises” maps out the evolution of Multinational corporations (MNEs) since the 17th century Dutch East India Company to the 21st century rise of foreign direct investment originated from emerging economies such as China, India and Brazil.
After 2000, MNEs from emerging markets appeared on the global stage and continued to expand their global reach and scale up their operations. A total of 124 companies based in mainland China and Hong Kong recorded the achievement of being listed in the 2020 Fortune Global 500, exceeding the 121 companies from the US.
Professor Chen notes that “as COVID-19 runs rampant across the world, populism and deglobalization have resurged, and protectionism and unilateralism have exerted negative impacts on the world economy.”
This adds to geopolitical and international security tensions which have been mounting over the past couple of years – resulting from the US-China trade war and the recent frictions between Beijing and Brussels – and more so this year with the war in Ukraine.
“The US-China trade war and recent Russia-Ukraine war further create major obstacles for foreign direct investment and make MNEs operation rather difficult in certain regions. Achieving sustainable development in this context is a test of a company’s management and governance abilities,” Jean Jinghan Chen, Chair Professor of Accounting and Finance at the University of Macau’s Faculty of Business Administration told Macau Business.
The authors note that “against this background, corporate governance has become a major challenge theoretically due to the sophistication of MNEs and the complexity and significance of their governance”.
(Source: Macau Business, https://www.macaubusiness.com/mnes-facing-rising-challenges/)