EXHIBIT 3.4
Typical
Multinational
Enterprises
as
Focal Firms
(Ranked
by
Industry
Sector Size)
Sources:
Based
on
Fortune,
"Fortune
Global
500,''
Industries,
2011,
accessed
at
fortune/;
FTSE,
"FTSE
Global
Sector
Index
Series,"
accessed
at
.ftse.com;
MSCI,
"MSCI
Global
Sector
Indices,"
accessed
at
.com;
S&P
Global
1200, 2012,
accessed
at
.c
om.
Focal firms are the most prominent international players. They include well-known mul-
tinational enterprises and small and medium-sized exporting firms, as well as contemporary
organizations such as the born globals featured
in
the opening story.
Let's
learn more about
each
of
these key actors in international business.
The
Multinational Enterprise (MNE)
A
multinational
enterprise
(MNE)
is
a large company with substantial resources that performs
various business activities through a network
of
subsidiaries and affiliates located
in
multiple
countries. Leading MNEs are listed on the
Fortune Global 500
(). Examples
include well-known companies like Nestle, Sony, Unilever, Nokia, Ford, Barclays, and Shell Oil.
Although such firms employ a range
of
foreign market entry strategies, MNEs are best known
for their foreign direct investment (FDI) activities. They operate
in
multiple countries, especially
in Asia, Europe, and North America, by setting up production plants, marketing subsidiaries, and
regional headquarters. MNEs such as Exxon, Honda, and Coca-Cola derive much
of
their total
sales and profits, often more than half, from cross-border operations. While there were fewer
than 7,500 MNEs worldwide
in
1970, today the total count stands at roughly 80,000.
1
Exhibit 3.4 displays a sample
of
MNEs and the diverse industry sectors these focal firms
represent. Due to the global financial crisis and worldwide recession, the market value
of
sectors
2012
Market
Percentage
!
Value
(US$
of
World
Sector
billions)
Total
Representative
F1rms
Financial Services
$3,940
18.0%
Capital One, Danske Bank,
Mitsui Sumitomo Bank
Technology
2,820
13.0
Microsoft, Oracle, Hoya, Taiwan
Semiconductor Manufacturing
Energy
2,645
12.0
Mobil, Total, China Oilfield
Services
Consumer
2.476
11.0
Procter & Gamble, Unilever,
Staples
China Mengniu Dairy, Honda
Industrials
2,356
11.0
Landstar Systems, Shenzhen
Expressway, Haldex
Health Care
2,233
10.0
GlaxoSmithKiine, Novartis,
Baxter International
Consumer
2,165
10.0
Coach, Adidas, Salomon,
Discretionary
Matsushita Electric
Materials
1,650
7.0
Dow Chemical, Alcan, Vitro SA
Communication
1,127
5.0
AT&T,
China Mobile,
Royal
KPN
Services
Utilities
890
4.0
Duke Energy, Empresa Nacional
de Electricidad
SA,
Hong Kong
and China Gas, Ltd.
TOTAL
22,302
100.0
Communication
Utilities
Materials
Services
-
Consumer
Discretionary -
·
Technology
-
--·
Industrials
Consumer
Staples
CHAPTER 3 •
ORGANIZATIONAL
PARTICIPANTS THAT
MAKE
INTERNATIONAL
BUSINESS
HAPPEN
61
in
the exhibit declined substantially in recent years. The largest changes occurred in the financial
and consumer discretionary sectors, which declined in value by50 percent or more between
2007 and 2012.
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- Business, Marketing, Focal Firms
