Governance of multinational enterprises

This chapter examines the governance of multinational enterprises from two perspectives, namely, from the viewpoint of the owners and managers of the firm, and how the firm governs itself, particularly with respect to the relationship between the headquarters and subsidiaries, as well as between the subsidiaries and local actors in the host countries. The chapter suggests that, as MNEs from developed home countries have become increasingly geographically diverse in their operations, they have also become more diverse in terms of their corporate governance, including firms that are directly or indirectly owned by governments. Multinationals from developed countries have become accustomed to a wider societal role, which makes them visible as social and political actors not only in terms of their corporate social responsibility activities, but also as partners in various multi-stakeholder initiatives and public–private partnerships.