The Rise of the Gtobal

Corporation
Deane.Neubauer

THE HISTONIC'RISE OF T}IE GTOBAL

dominant tecbaologies, especially in slupping
C0RPORAT|ON, THREE prnlooil : and navigatioo CfIarvey, 1990). A.s Mooi"
*J
Lewis contend, the entities operating with_.r
As indicated throughout rhis text, giobal
cor_ this enviro4m ent w erefunctioial ty id rg
polatious are insepagble &om-th" o o,r-
o,or" izationally Dot so very different from contem_
general phouomenon of globalization
itself.
It follows that how one identifies gtoOatiza_ lorary organizations, being possessed of
'head offices, foreiga branch plants, corporate
tion serves to ,locate, giobal coriorations,
-interactivl hierarchies, extaterjtorjal business laq aad
!"1j, :.bytheglobalization
comptex fi;; even a bit of foreign direct investnent and
lctrned and withir given value-added activityr (Moore and Lewis,
Iustorical periods, This chapter situatei
ttre 2000:311).
global corporation in three broad
historicai
. periods, of wbich the
last two have b""orr,. . The vastheterogeneity of ihis longperiod,
however, leads a rnajority of scholar.! io .it.r_
themostrelevartt.' ... . :
ate the direct antecedents of the contempo_
The approach to the study of globalization
rary global corporation within the dynam'ics
sometimes termed . :historical globa[zatioJ
of a fwo ceaturies-plus long duratioo ,pun_
locates tbe phenomeno" itr;if
; ;;ry ;il; mng the period prior to the end of World
of pt': and exchange
@eutley, ZfiO:; Cii[ War II in which the modern Dation_state
1i1^Jlt*p:on, 2006; Moore
2000). In early historicalperiods
*a irrir, system emerged in ways that allowed inven-
as both cities tion and social organization to combine that
and cpunties extended their reach
beyond vastly increased world capital and the wealth
t"l' g*o bqrders, tbjs view h"ldr,;
globaiization was iaitiated which
f"#;; of natiou states. Coupled with an extraordi_
then fol_ nary rise in global population that aftended
iowed corrplex patterns of interactive
engage- the ildustrial revolution, the societies that
T:rt: ,gtqT-ed tbrough rade and aireclty arose would invent new ways to organize
urtlneoced by the emergent and subsequentiy
the world itself througlt coloniaiisi and
q:l-

:'
THE RISE OF THE GLOBAL
CORPORATION
267

inperialism that vastly

interactions between
attenuated their . rntenrationar companies are
irrrporters and
regions such ihat
reopies, states and 1n.nr^, wni.ally without investment
i crearly iiro.nriuira .r. of their home country. - 'urside
of global interaction .", u" ,"i1";;# . Mril;i;;ritiorprri.r.
(Ilarves 1990). Many or,tn.",qiur""i"n.J", ;,;.; ;;;;;;;r; but do nothave investment in

:f ft: global ,u"-*"

have coordi,ated
prtor.i .*.riris in eath counrry.
citrectly "otporution ".*,,""
in this chapter date from rhtt;;; They are more
focused.on adaiting their products:nd
services
(for exaurple, patti*s of
corporate r ownership and"q;ity
;;;#. to each individual tocat market.
manage*"nt 6i l'l.otl,.rpanies.have invested in and are pre-
subsidiaries, *:e relationship sent in many countries.
;i-,;;;r:l ney typicatiy rnarker
organizational.tunctions:,".-.,ppry
ffiiJ and services i. lr,-r, iloj,ia,.r
tnbution chains, etc.)t':^rl"_b;;;'.f iffii*:?l:,::
rate stuctures ii.';the. most
;;;_ o Transnarional ,comp.inies are more comptex
globallv-engaged and orguri.utio;i *hi,n n.r. investeJ -ir -ior.ign
prosperous
'qai9,IF (ils;U-;;;;h
coiouial and iriiperflisrr"ruiioi,-t.,tr:""t
operations, have a centrar corporate
facirity but
give decision ,ut,ng, research
As the world emerged &om -tti" ,urt and devercDn:ent
deskuctiousof worid-war II, ,;;;";i;
lnaot una ,rit.iin'g
fr"ier;;;;;.'" il;;;,; .J ,il,liorr,

lT:ffilq,ftifi1#"Xi"ffi;,::1;ffi y":..,:,T,ry the rNC has been derincci bv

for a period fiom the ena or a. *"r..r-oj': centre on Transnatio,at
the reentry of Japanese and
;- ,l,rii 3:_,:*9
Lorporations lutr'cr!) as an 'e,rcrprisc
European;;;'
lroraions onto thl global scene.rr*ririil that engages in activities which add value
stood ('tn_anulacfurlng, extraction, services,
_for what by then had .o.n. ,o ul rnar.-
vteu'eci as multiaational
corporatioru innucrj :,t:tl1^tt: ]^ ]: -.ot. than one countr)/
(BarnetaudMueller, 1974):Thiso.""Jt""1 1'his chapter will en.iploy
rhe end of World Srar tr to the presen;;;;
l,:-i^t]:,,1991)
ure re:rn 'global corporation, to refer
ro all of
viewe$ therefore; L-"tru"a'*ft;ffi these fvpes, seeking within specific
"ooi"rt,
period rn the" transfonnatioa
ortn" tJui f,?*r:f,"# ;[T*'iffrt::JrrX,,fi
;:ffi:i#tff,fft?f,ilT;i$:;1"::: indicate, r,o*"u"i, these distinttions are
poration occurring ;:,tr,r.r,-ir,j,i"p.""a "T :::H*]f,:,STJT:,J:]"I;",.
H;,l!::r#:"*11? fi:" t',|itrt;n tio,
tions operate *ithin grobatiza.
broader itro"t,r?,aireasions reqtri.es a brief"ont",,porarv
recountir,g oison.,e of
of globaliza- the major changes that have tak-en place
tion itseif *.f ut tfr" ,ume time significantlv o, e,
conrributiag ro til;; ;;";;; .-f#f"'r rt;"fliT ;:,Uffi :il:?:rJr.:#i.L:l:
operatiag iatemationally had enonnouS
I'IOW DO GLOBAT CORpORATIONS advaotages in the immediate post-r,"ar p".ioa
rh.y _ virtually atoae in the world _
FUNCTION? WHAT,CONSTITUTES
" v ' LJ A
6r-oBAL conponeirorv-rr ^ :[:.f,::,r.-jff :ffiT,,,H r::il:llL:
,re contcrnfo.u.v globar corpcratjon
srn-rultaneously and coqmgnly-'refened
is ilff:#1Jr"J,'il"fi;*x,n,*:li:1,
eit,er as a tr4NC' a u'ansnational corporalion
to
dates from tt'," ..ooo*i. recovery of
capital
(TIIC), an internationar iompany skuctures rn Japan and E,rope and the reen-
conrpa"'r!. wn:.-le''much
*;;,"il fry into giobar markets of their.natjonar
cor.-
9r d"
_r.t,aj";;;;i porations, By r9!4,Barnet and Mueuer
this chapter wili serve io
;l*d,.. ; ;; path-breaking yolume could both
i, a
these distiactions, those-offe.ed defiae the
(2012)lare praciicalty us"dil.
by-i*;-, IT,INC as a rnajor economic.global actor
and
begin an effective description of lo."
tfrls
 268 THE SAGE HANDBOOK OF GLOBALIZATION

Producer-driven Commodity Chains

Domestic and Foreign

Subsidiaries and Subcontractors
,;lirl. i :.i'
Buyer-drlven Commodlty Chalns
OVEHSEAS

Figure 17.1 The organization of producer-driven and consumbr.drlv6n,comiiiodity'chdins

5ource:Gereffi(20011:'1619).r iir " i ':i''l:'i'')"':':i ,.i
: : ''''; "" ' i
, ' ,.;' L t,;,1,',,:l:,t,:r;;i-.
:', r t-ut
,li
particular corporate fonn was ssming to and the increasing'ro[e, perfogmgd through
dorrri-oate rarious aspects of globai produc- the global system b 1financial elements ar.d
tron and exchange @arnet and Mueller, the emergence 9! the global frnancial lurn.
L9'74). A cousiderable amount of other The post-war period can be delineated in a
scholarly u,ork documents various ,waves, number of ways. Geriffi, for example, empha_
of global corporate development through sizes tlree,,srdptural, periods.:-, inv'ejturint-
the subsequent six decades to the present. based g.lqbajizallga(tpdC-{0) ; trade:based
The overaii structure of thii system globalization (t.flffis);;digital
,.r'ould stay in place and conti:rue globatiza-
to develop tion (1995 ouwards). Withh this analvsis
tbr-oughout the 1970s aud l9gOs a period
-
that stands chrbnologically just p.io. ,o
,ir" nature ,of the global
"o.po.uiiou
changes accordingiy, beiag driven in each
three fundamental iolovations that have case by its evolving pumoses anC bv its
substantiallv changed the character of the cxtended reach and abilities (Geriffi. 2bO t:
giobal'corporation: the advent and impact 1616-1 8). Another method lof p.oj..t*g
cl digitalization and iastantaneous gioUat this growth is to examin" tti. ,orr.i.,
c orrm:.unic ati ons ; the s tructural traris forma_
ievels cf Foreign Dirbct fnvestment (FDij^oj
tion of glcbal'commerce from producer_ most of which was of corporate orisin. As
,jriven' conLrrodity chains to buyer-ariven;
Hediey indicates, in'tlOO otty Euiopean
 THE R,sE OF THE
GLOBAL CORPORATIOIV

corporations were^major
joined by some investors, ro,be foged j::! ia the period r996-g
1930s. Ciring LIN ,.13er9an-
n._r",ir"rne 1e.1e.
(Giipin, zooo: ilo1.
data rrc
the principar turml'
aur.r'"rgio.^, Tl. ;.:;;nt_based
g.3i r.;""r.oi ,r",n" penod u,as domr_
majbr'diivei'bf extJnaea.qlbt"i
l"#r"r" ;;;;;;;lr_ariu* commodity
devetopmenrh u-.":u ,ru"r-e-q*ni;H9: b;t-,;;#"oerized
"ii",rr,,*irr"rr r q* tended to be varu..
dominated
<.,r

;ri!ffffi,1,!$; ,.;*;ol'-0i,, *ll,o ;;"G,:'.*#tar fqcused o.n iarge_scare or

by large amounts of

rhroughoui' dsel: p",iods

:

onomists,
otherschorai's and
the nadonal ano
ec
govdmm""i"o,#"i'i",,, [{igl;il?iTuil:ft}*ii;::f*
gr"i"i.i*.i';;, this period was power_
T,:Trl."iil;;r;il"d ," rurry un."i".J iy ,r* transformation wjthi,r
:m:;,3:flffi'Ug".:*'#['
Ln<iiscrrmuateiy as
eituer Mlrics
;[:.,,^,i",J'..","ir., "1,1"
ing companies wrought
orde,nanuractur-
by what *r. l"*"0
^,
*o ^r.-tr'
rhrough efforts ro derine,
me*"."
the exient and'consequ""r
initiaily,,and piima113e
"rrx ,rr"rrg
oirbf;;;d; fr:J'"[k;::xt,fir1'TTi:,-:,jii:";;l
li irto*rapprications and
its rerated
capitai frorh a'source exrernai
u,,
il#"'#;:.
r"," J"*n,
. .or,rl-1i-a"]-t l,".**pre, Bluesrone
ancr
iato a receiviug !orinP:'usuniv q"*iroi, rosajiririrprogressive,shift i. the
tiffi:i;
in terms' ofi,out-ward,'*a,:ii.ri"jrjff*:, siting of rnanuy'acture rralsformed the
dorni-
r,u,rr-*u'uaa*;ig firms of these otder
if.fl* *l?;f;"::.:Tffj***:if 1fu,#*ffil?i*'i,,"' ;;";; ;i:,,
* ir*:r"r,:; i;TjiT# i1[:F.-:#fffi "iffij:ilT, i,:*:
yg,ll iria reffi
',iewecr as,the ithirdl even iiffi:]
#.t#l},lTAu,"l:Jfiffi,1;:,rl;
the vast maJorirv or
betweeu countries of the
; ,h;;rrtu;: *or" uothenticaiiy'grobar
foj'crevetopJ;;*: firms rhat requued
primariiy North Arireri.u, exrensive .orporuie'rrrt.gration
e*opi aool"oi. ties throughout of their acrivi-
Since te64 the unrted
on Trede andiDeverbpmen,
irilffi"*JJ#: the world.
n;r;:;;;;e _structures, especiarry
grrai";;;: those in ,ir" rj;*a- states, operatirg within
focuscd on the variourroi",
the development
tr,uirLi;,#,ii ,1" ti*" il" or""orr*_driven
process and has n ulntulrr"j "r conurodity
chain had been oiganized by what came to be
-ruir.,il:"Jt
:1,i.,!:J:l'.1?,'3 recognized u,'rc-,.ri,t' manasement
lation. u,"t
re gu
i*l'.J* pnnc,

"t.. "o;;;;; lfrrY: fiTj ;: JJ#:m.tf ;:;f,*

grouur :

cross-borderr ensan"n;eatr*fn"aJ[r"r"o
narional *"".i;.i1rrlrg
ror g*gr-il holdings. The
;iir? t"::;3:;lit*os" ilji:gi:"':?',1#, as a major producer
leriodi ss!1e0 ini;.:ji::ii W,:,:
oJ 30per
""rt
oyrioi.,ne,.*sutl
mglv' was the changiag r-ar"upl
r',:;*il;: iii"#
brought
l::,".T1,,Lr,ilf-,i."-#11
onto the scene new modeis of effec_
::l
rale uuts and tireirrelationship
oiJ*; 1"" ir"ar"riol-ro""*"0 especia,y o, quar-
to.u.t otf,".. ity and ..girr.r."i nexible
DeA,ne Jutius indicates.that producrio, _ a
tbe ._0";;l;; *o". ,rrui-*", *i".0 within
;J,i!lrfl:Hfilffi,;l',""";r:11,;Ti 1.",, *;","i"1 "t'i" grouur comrnodi,l
European

ar
at which'u
which 'u"ou"uirlaifelv.,rtiffi*"b.r
:J:i
rru-uiia-tiiJir;idffi da+ ^r ,:hu:i:' These 4ctivittes were experienced
iir'kages' was" brebted.*Jdt;;#.; ;;"lH ;ff:""l"H#:::#:"fJ,?ff;T.:s
eccno'rhies (Julfus, ,rol^I^:: ffi;;
that sgme zo,0o,g nely. aolpor"r,
:d;#i:"ilT],*",ry uncharenged
posrtions on prqducr design, production
"Ifi;;; ,ffi.irn"y, ;;dil; _.and ultimatety.on
 270 THE SAGE HANDBOOK OF GLOBALIZATION

. : j:::.' . a:,:
".-:,
the ability of these. corporate skuctures to by time an{ qpace,,current digifal teclnglogy
maintain their agcu.stomed'returns on has worked to
ldip;plapi 11t,o q digital global
invesfment. The result wasi a progressive world ,that makes possibfg .the maximip4don of
'reinventing' .of the Amerjcin business !
various cgporalg gQarls,,2c, w, Z{ Q, gg,-nvity
model, especially th6 industrial model.- a ort cgTqrgn 115$,,thr. o;rgh !!{ed.global sites,
ihallenge that woda aominate ihe curricula the targeting of optim4l cost la]gggrmar].eb,
of US b*usinegb schoofg frir,'qver two degades etc. (Gautam and Bata 2011). ,,
(tusi, 2005), and wbich iq,also pontinuously The statusl of"nsy, pboliq, papital, withiu, the
associated with the global'value- shift $om glotal marketplace is evident ilthe increasing
manufacturing capital to finance and.human value .and impor[ance being placed o!;the
c apital iir pro gres sively networking s o cieties branding created and.ourned by, global corpo-
(Castells, 2009). rations. Irt a world,of continuous and instanta-
Gereffi. has argued persuasively that 'how neous communications,:, corporaie brands
g1oba1 corporations' work is largely determined come to syrnbolize the..entirc rangeiof corpo-
by whether they are:ituated iD producer-driven rate activityr to therextent tbat individuals,lvho
or buyer-driven commodiiy chaiqs.
{ieUre 1/.1 know r"irtually nothing elsE,about p corpora-;

drau,n from his work oa US frrrs sugge.sts tion but its br4ud come to intemret.its.staJus;in
iLrdirectly that the moro 6uyiririven, they are, the world an{ the,yalug.gf its produpb and
the more lodes exist within their networks and services,throrrgh the braud" Knqrrm as 'Braud
the greater either their ihterdependence on Fil?nqe',, anew (isciplinenow-ranls corpora-
other actors or their imperative to estabiish tions in global league,tabieq,og,thc value of
extensions (by whatever oy{nership or conkact their brand, in, a'manner p212[e1 to theirrrank,
means) of supply, fiiance, etc. ing by various entities in terms of their aggre-
The degree to which-these generalizations gate revenuq,l, q.rningq, etc, @rqnd-Finance,
were apt tas intensifiild with.each extension 20 l2). In tlis lregard,.for, instance; technolo gy
of digital reach throughoui the world. Com- brands had becoqe,ttrrc nacst yeluable.global
modity chai:rs nory_needJo bd concepnralDed coryor,alg brandsi.in, 2p]l,with,Apple lauded
as existiug u/ithin blu6oniinarily complex fo1 hqving lleapfroggedll-Gpogle for. the, hon-
iaforrnation structures in which conrmu- ,our, of .place,rrg4t, at Numter l,,with a, brand
nications are virhrailv
1 ..instairtanbous and finance valqation gf US$J0,6 billioq.whereas
apFear to grow exponentially. Global coryo- another.success story AmazoD, saw its brand
rate struchres and operatigns can be viewed finance value rise by 61 per cent over lb.e
'vitirin the s1,s1-6[angipg digtal eavironment previous year.
as frarned by the constant need to deveiop and Digitalization [as affected. the entire
adapt. Equally, one can euvision corporate sfrucfure qf how gloppl corporp,tions oper-
acri.,'irv as beiag propelled into extensive ate, Producer drive.n stgaDq$,have progres-
corr:lunication environileats in which the si vely integrated their- corporate structures
dynamics of competiSon frame much of their to redrrce the effects,of time and distance,
behaviour and make activities suchas the abil- especially tbr services- perforqe{ within
rty to establish, daihtaitr and ortedd lorporate corporate stmctures suct as desfgn; finance
brands an intinsic element of global .ipitut and accountirig, adverfising ,and ,brand
- literaliy the pointidt #hich n.raterifii cipital development, legal services, iaveatory con-
(that requued to produce, deliver and make a trol etc. These exteni'ive capabiiities of
product or service k"o*r) becomes insepara- conkol and managemeui at a airtii"; Ll"ri
ble frotn syrubolic capital (Reich, I 99 i, 20 1 0). many of the differentiated aspects of prod-
For a wide'variety of 'so.called service activi- ur.:t aud service based finns. Digitalization
hes that had previously ibeen ,deemed ,,in- is ttansformirig tlo ctaisid viG "c[ain cf
place',,for- example matry aspects of medicdl manufdituriagr focudiil ' ohl'iriaoudtib, in
care, srbrw-are design, etc. and thereby bound which:
 THE RISE OF THE
i GLOBAL CORPORATION
271

this regard, for example,

Kentor exam.iled
r:lTI period from 1968 to iseS;'*1";h
Lhe

global corpora/tions
wue d.u.loplrg ;_.i, .,
the skucture replicated
,
EIis goal was toeri:piricully
;;;;;#;
nom:c and spatial expalrsion"*rr;;'#;^_
of tun natiunlf
:o?9rate nbtrvorks ove.ti*",
individual counbies ana
* t"rnrffi;t;
*re etoUal^;"*#:
a whole' by chartine ae
the. globe's 1 O0'largJst
sruffi t;;;;;i
tansnatjonal rranr r fae_
co+orations (Kentor, 2005).
,; ,ruf$
oom growth and concenration
In ,.".",
l-:t:',tYt4T{+S,9r, gooqs aJrd serylges 66n_ the r..,,lt" .,^".
Tu*g..to gafui,mar*et share orer ioJ ,_ itarttlns. Wliereby thei;-l"r#ffi ,ili:, ::,i:
PlaCe-rmarlceti-- Ia-J : -^rr:
,, I;:ij:tT:Y5,a,,q,,99lltngi,;Ihe,
svu.4rris lBye;bglEg wibq-sq to a
past rbree y91uon$ owned 1;2gg subsidiaries in rso i.,
' fuudamental
tansforarqtionofth"r.narat i-r,.^--, ...
1998 the top too inbdsbiir
cbrd;il;;;;J
;;;;
learlV I 0,000,subsidiarres Ct<eitor.ffir:
of subseQueni r";"rJ;;;r.;:
Y*.1":
essentia.l findings using othe.r _"tt oaoto
. ni".
and indicatom: The Global
loo il;;:;]ffi;;
that includes all sectors of
gfoiui.;;;;:
tfr"
grew from a 0.09 share of global
COp ,, isgi
.,_10:,3.,
1998. Expandin! tne ,""p1;r;;;:
. f:,J:
from 0.15 :*^.11.,:lt"
Grobal !00 g,.*
to 0.28 of COF U.r,"""rir"rr"*l
I998 Q(entor,2005).
Aaother indicdtor of concentration esti_
mates that in 2009 oftrr6;;;,otj;r*,;:;
nomic ientitiei-'44' are" corporationf
examines thetop',lso *it,
,f ;;
tn, p"..;;;;;
are corporations rises to
59 per,"ri. fl. +q
corporations
in the top 100 i" ZOOS e.rr;t",t
revenues of US$6.4 tillion,
equival-ent to
Relcelt of GDp (Gtobat Trend;, Z:Ot3).
-t "i
Such questions. ibout n,
,"iuti* , ize of
.gl:_!:,
coporatlgiq aud their *;;.;, ;;;.
::li1_"-*i"py,fier: shongly in making an
assessment,about their relative .net
'worth,to rhe world. rr is usetuiio value", or
deal ""i"ir:"i
Iike so many issues haung to
with the
vast complexities of global
coryorur. ,t -r.l
rure, how one chobses to Iook
at the data
does much to determine what
one acfuallv
sees. 'lhe data cited above,
f",
which compares corporate sales ";;;;;i;
with GDp
nas. become one of the
mgst cornmon ways of
seeking assay the rclative ,ir" of
_to nioU"i
corpolalrons, and from
that to infer theiirela_
hrte the tnttuence, Perhaps th9 most
l1fe, corurlon
cllatron rs to the wor* of Anderson and
 t..,'

272 THE SAGE HANDBOOK OF GLOBALIZATION

,:. l.t I .r,.'_,...

Cavanagh who in 2000 determined that of hrghiy concentated stucture ofownership and
the world's largest 100 economic units 5i iateriocks and a network squdure dp.qdnated
were corporarions (Anderson and Cavanagh, by avery dense core in which three-quarters of
2000). De Grauwe and Camerman (2003), the ownership of firms in the core remained
however, argue that corporate sales and Ln thc hands of fir:ns within the.cor6'itself. As
GDPs are not in fact directly or usefuliy they conclude: 'This is a tiglitly;kni! goup of
comparabie. GDP is calcuQQd as the sum,of corporaiions that' cunrulativelji hold the
all values added by each producer, not the majority shares of each other.'Framed another
sum total of ail ,the. s.ales .of all producers. way, approxiriately'40r per'cenlo(,i['8 contiol
Calculati-og in this manner2 they contend, ou"r^ G
economi0i'iiahi6, dd oTNCi'' i;'rt"
.esults rn significant amounts of double ,;v or ld is' held vi h, ownersnii tt;tUfioiisi'by a

co.rntiag and wouid create much higber GDP group of 147 -TNCs iinr'thdir.lcorb:,which
figrrres. S/1rile agreeiag that giobal corpora- has almost full control over'itSelf' (Vitali,
tions are vast il size;,1o r€asotr exists to Glaftfelder and Battiston ,20111 4):' ' ' '

conclude that thgy are 'biggel-than nations', When one atterhtrits' tdraisess' thii'bveiali
or that ;their size iglative to,, nations has role of global corporations, itiis clear that
i:rcreased. A relatpd,issue that ofteq figures they constitute suchran: esientiai part of the
within. policy debates carries. the presunep- economy that their 'vdribus rdnd multiple
tion that the argna of all global corporations activities in fundamental' wayi.'determine
is elTectively represente.( ,by their best- what that economy is going to,bE. Tbjs'was
i<row'n, larger exemplars,.no matter how size amply demonstated in thcrfirhndiel crisis of
is measured relative to nation siates. To 2006-7 that was tiggered ;by ,events that
clari$, the extent ofglobal corporation activ- '.rzould merely two decadesrearlier have been
ities Stopford points out thqt by 1998 cross- regarded largely as phenomena intemal to
border economic activity had .become so the US economy and from which the 'rest' of
commonplace that fuU.v 45,000 firrrs could the,wor[d, might arguabl] rhav€,.distrinced
be categorized,as qlpi,,most of which oper: itself. : Ihaq howeveri, is',all, too obviously not
ated w'ith fewer ,than _250 empfoyees,_ and what happened -:, ia .largie r
pdrt:becalrs ei glob al
with many service companie,s o,perating ia as financial firms, ,am6ag them" lsading TjS
many as i5 countries with 100 or fewer firms; , ,had . created- a variety . of fiaancial
employees (Stopford, 1998:2). insfuments organi,rsd arouud,U$iteal-esdte
,
A:rother approach to estimating the concen- values: to be
"taded within a flobalmarket,as
rratron of global curporations has been to hedgeable ; securities.r As the llntemational
exam-i:re the iiiterlocks that dxist bef;veen their Monetary Fund (iitztr) hasl,concluded,io a
boalds of dilectors, often referred to as .ttre recent-,repo4 thg fiaagcial crisis iof 2 0 0 7 r
"9n,
network of corporate contol,. Utilizing a vast and beyend, the, prosperiffi of, thei preceding
data set and complex'nefwork rrodels and rwo decades owed,much within.the US
analyses, Vitali,' Glattfelder and Battiion eeonomy ,to total , creditLmarket;,borrowing
(2C11),sought ro move peyon$ well-known that grew from approximately 160 peS cenr of
'of the .

correlates *"".-otitlgor. of exist'.g GDPr.in l:980 :tor 3-50igerr c,entrriq 2008., his
lvealtli and rncome, *g."*pfor" th" ;;tu; inc.rgaqing debt structurg,fscuged oa rthe, oner
degree to which rnteiio"tdng membership hand the household level where porrowing
resuits in control ofiglobai corporations. 1t
rough.iy doubled from 45 per cent of GDp,in
Employing a very iarge data set of 43,060 i98-a to 97 per cent in 2OO8 and on the other
TNCs'thelr analysis indicated a r.etwork of all on furancial sector debt which grgw from 19
o\\'nership 'originating from and pointing to per cent of GDP in tSO+ ,o uTr.;ii-"i"1"
i15 per cent in ZOOa 1IIl,m, Zoiij. .- '
TNCs' with the resulting network pointing to -
600,508 nodes and 1,006,987 ownership ties Howevdr, numirous commeriiators agree'
(201i:l 2). Their findings revealed a very fhat had this debt not been securitized through .
 IHE RISE OF THE GLOBAL
CORPORATION
273

noyel.atrl widely traded

instruments in
2008, th";;;;i;;
the These companies have
:-',:,:1ll':
cnsrs
to
Inay havb been:substantially il:; also becorne
in the broad pattern of global active
.rr**"^'""0
*A]sut J acquisitions (MAey, . pr,rrry
l l ;' stielite,' 20t0ft;#.:H:
,$T*:
rlbrprcts ?9
the actual pt"yr"e which corporate conceniration'r.k;';;; "fi;i.;,
ouiof ,h, ;;: ,To cite Ahern: ,,
iiil,:*b,*. estimaies or its p*.",i"i
.#r- "r l

rry,rL r.s crear that

slobal financial
oq"E''fi*"mi tiliv *ur'frrrrs and ln 20.l0 these comc
:: "111
coastrtute ni"t'l ,.**,.o",, i=.. il?5H:'fl'JX'l. l::.i #l
vzhose acrivities are
;";;;;
a aew fonn of globJ ,r uq
lrom 661
::,j,:', acqulsrtrons,
rv,&A
or 9% ot ,.,,i
acquisitions,
capabi-e
global econo*v i" po*urfrt "f;;;fi"il;
in 2001. Cf the ,, Vgl,,:
il;ffi;:: o€dt! 3111sg116sd in 2010,
emerging markgl 6smps6ies,
5,623 (5Oqo) ,"r",ril
eirher u, orru] ,' .,,
as rake-over rargers of
rt DlrrrRrrw ABg uT TH ts trie5, 141.,.rn, ZA11:23)
MNCs rn ,;r;;;;',.".-
-e'!"!ru ruu ,-
H:r.lT_
lI$!
DEVETOPMENT?
oF GroBAr coRPoRAi;
:. ;-. I'"": The,flct that the global economic slowclou,n
'i;:,i. ,,.,-.;..,, resulrrng h-om the financial
crisis of 2007 has
nao a
lesser impact on,many developrns
, and economies, especially ttre Bnf-CS,
the extent to which ttrey have
il;"";;:
-' becorn" a .,e*
have and important source of capital
vvvvurw, ursiurosr,oyruunlc
sector of global . globai system.
*itfr* irr"
:'T,"J, :i:rqflq'
rep-qssente{ i" p*t ui ti"I Capital flows in general ovel
:lgryfl ru nP{'.jv.', tdiiuI""-:,i'{ffii" iil the past
decade-and-a-half have: begun to
!o1q!,of!'DI flows iS still le.u O*,r1"il"ilil .l;;
frorn the dominant oorth_oo-rtlrloortf,_roril,
passes between fullv
dsyslsp;;;;; dynamic to one in which ,orn_ro*f.
Tabie t7.1. demonstates unj
tal flows
O",rlridry #r"pi south-south capitai flows are
sign,fi."rrr
lo leveloping countre-s. ,
(Ra]an, 2010) with most
rn€ relative'size, growtli of the sou]h_no,tl,
ind rdnpe .,r capital flows coming from Ch:.na
actrvrty of..global cgrporaligns
h;rri tl" Exampies include China's Lenovo
il lrd,;.
emergrng qcgnomies
suggesi,that they are iion's purchase of IBM,s pC Urr*"rr-
.;;;r;
on a. trajectory that *ifil;o" u,i
within;those of the
o,to;;;.L;; India's irvestment ir various t
f"oi.v hisfq;i;il, riJr; istori"atiu
developed economies. The British firms including Jaguar f-.r,J p.*".
number of (,Economist, 20l l).
globai co.rporations from the Increased norlh_south
ker economies listed in the
emer*ing;; rnvestments during this period
ForturieGf"I"i aliowecl
global corporarions to i.ebcu nd q rl.
500, which ranks corporations
hy r";;;;;. .nor"rh
from their profit losses and restore
tl,
rose rroin 47ifirbas in 200i
to 95 iu 2010. growth. The reiative robust natur.
,.o*l
nf ,n"

=O,9
rr, , ca laf nbws to developing countries, 2005_to (gbn)
Type of flows
Total
za08 2010
579 930
ahr
lv
1 650 447 6s6 1 095
332 435
Porhoiio investment 5/ I
652 507 561
154 268
Other irivestment. 394
93 186
94 )1o
686 39 56 348
'orher invcstrnents include
loans from.*r.*nil*-il,i.rll* ** r**
5ource: UNCTAD (201 1).
 274 THE SAGE HANDBOOK OF GLOBALIZATION

. , l',
emerging economies has contiuued to world such as Malayoia, Mexico, Russia,
attract FDI and to create conditions leading Turkey and Vietnam, The following list sug-
to the rapid expansion of their nationally gEsts some exemplary cases employing 2009
b as ed global colporations (IINCTAD-WIR, data.
2011: 26). China is the largest developing
country outward ,investor with estimated
holdings in 2009 of approximately US$l
trillion (OECD, 201q. The differential ,;-_ ,. t:,.:t, .. ,

impact of such emergent global dynamics al a world .leader in

has moved some observers to suggest that
our previous distinctions befween global
north and south are no longer adequate to
suggest the overail dynamics of growth and
inactions within the global system. Wolfsen- j

sohn, for example, has,suggested a charac- 'l

l
terization he,terms ta four-spEed world'
that;' ti

that differentiates countiesris Aff,luent, Con- il

verging, Stuggling and Poor, with the BRICS
dominating the growth ofthe codvergentgroup . ' Cosio arbdF.(ChlirII ISlon'e 'Of thd' ilrqest.shio- J
(Wol[sensohn, 2007).,, ' plng eomparilesln'th€world'r '' ;;.. ' :i ." '
The importance of global corporations il . Embraer,,(Brazil) ,has surp6sseil Canada,s
Brazil, India and China to the current and Bombardier as the market leadei in'regionai jets
projecteci global ecouomy is singular. With . Galanz Group,(China) hasa 45 per cent share of
40 per cent of'the wcrld,s population the the, European; and a 25 per cent share of the Us
BRICS represent a piimary force in both
giobal production and consumption.
Hawksworth and Cookson predic| that o
'n-iiddle class'consumers in China,and India l
will grow froursome. 1.8 billiorrin 2010 to )a rNdmak r(tileiilio)
is oria, bf thi, wortd,s tebrlino
3.2 billion n 2020 and.4.9 billion, by 2030 suppliers of : 6/ indei libail and. bl6i'li casin gsi t#
(Hawksrvorth and Cookson, 2008), The rel- the rautomotlve industry
ative import of thejr global corporate cul- ' Sistema. (Russia).is
a'conglomerate with E focus
tures can be gauged in part by the fact that on telecommunications
in 2012 giobal corporations in China made Tata Chemicals (lndia) ;ls an inorganic-chemicals
up 73 of the largest in the Forfune 500 iist producer .with a significapt globalr market sh
are
(CNN- Money, 2012), and whereas Brazil of soda ash
and India with eight apiece currently Techtronic lndustries Company is the number one
account for- a small share of such corpora_ :.t1,q!li.f.11p?ryer
toots to Ho;e Depot
tions, emergent market countr"ies,2lei,pio_
jected to account for.a near doubling
oftheir
share of rz,,oild trade over the next 40 yeirs,

il,chine nearly 70 per cerr by 2050 (ahem, Wbile BRICS are.hbst countries io tUr f*-
2011)- In 1998 only one of the top tOO gest number of global corporations rmorg
global corporations was located. outsiie
the developing countries, these corporatiuo,
States, Europe or Japan (Oattey, also distibuted across other mariet
*f
Y:,::O
2008). areas, *ith,
Mexico, Rus-siq, the United Arab Enrirates-
Rrsing global corporations in the BRICS
I'urkey and Thailand nixt in order oi
are jo,rnedby emergent large companies in frequency (Atrern, 2011). In 2009-a]ri;
other developiag economi", tf,ro.rrgiro,rt
tl" became,the leading ffide partner of Srazii
i.
THE RIsE OF THE
GLOBAL CORPORATION
I 275

India and South Africa,

and
lata of India
became'u",.'i'I;j;.H+ffi T'ilt
*,^ff ,"#JJ
#jr|ifT:T# JHr:f
::l:'tr
qver 40 #".*,:f:?",|:f.il;
per .4, oi#.r.[,Jll:TJ'ff ;;; orconcerns, many orthpm rocused on chi..
Asiai rhe oEco'has binrniri"o
rir, g#,:, # li;8trI#..#:$1ffi:T#".*:;
,u.i, noi, *:*irilor1.*urt.t
developirigeccnomies
in terms of tf;effi;; io
comperitors
1lrins emgrg,v theq Rotentiar and a*ual
;l.#-"',"]il:1""j,H'Hfi -'*ri',{#;ilni#.:"ii,i1,:::r.:::,ocrea,ed.,ni.
*,:^tlT:RgDmembeirco;##,-"ff#:ffj jff"i""fjlffi Ifl r:l"tiindustries,
lii:l[""f_TJf,-i,,#,f_"hTi,?1,.*il;ll#:Iil#ff H,fl,fi#."ff "ff .,::fl
idfi:;ti6:_ili:iT
tivel,v: eno.-^r;!r growth
;ll';,il,i;;il
h^,,*-L rof,i
{ ^!r.,,the ;;;;
.
:x.,r;
seen *L:ffi
Io Erve such :r: ficou.r-::
Li[i :uufair
r

lr-"-urr. :o"*rousr
economiesi the mas 6^---r-r:, . i"i' i?
. - : petitiveadvantages.
,#iff i: 9: mqcii,,;
_
s ive pop,r",i"o
il ;;;i;. |i'E;;:il :l"H'##,n'":l Ti.:"]::l :l
:

il
:f;iff'rnsn
E:ffi:Hfr .*;: s:w project i=IrilH l3i:,#ifpfJ}:1,,.i,T?,,i,r ; : ;
rhar in
tt,r.in,4050_ /rL:-^ - :l Td
China:;will h"r;;;:ilffi chjna'"s rtut" ro"itiJtsvstemtliarnenicrrraroo
;:'il:#*%ffil tliat'peipetriates

-'.JJ;; *-"I'i":?,ffjJ,:.,",?liHtf3.::iT:::l:
;:?ff II#:j,j,,:^1,1,Jt;i,,;r{;ffi
37'pg;gsnt iuut or trie
I*:!:";:{l
states; ;rrdia ;',r.,,ril'ai*g;i:i;ffiT #;r'ffiT:r"::ll:':-1ff:i:::,:,-{-:-':,Tl1"
with'have percapita income ;[ffTJd::#txi:*: ff;*lx'l"lJ];
or;ust II';;',
."",i;$";t;j"11flj*j;i:i::_1.,ffiare i,. effect srrhqi;i-.nlL,, +L^...1^,. -r
Stare'owned corporations, "T,;Y:J*:iifr :J:,,"*?JI"jil,
may be ;l;H:#:r.:tHfJi',f,:'j,ll'i,l;.i11
ji ,

"ni"r,
l;,Hj.::,,;::t:f::"i^:^,y1"1igroJ'*
enterprises:"and,their advantage
ror"ig rffiir;;-;; il,ffi:: withinigloba| ;cornpetition. beins
which 'the''governmehr o?r] ::'T ff:fi ;:ffT['JL::il:
discrprine (*o"t
"";;Iil;
."-
"r,:ioop,
Greenacre, 2012).
whdther, or.nbt listJdron ,.r""i
Anorher view charact'prizes
ff:"IilH:.-l1.i1y;"i,,:,,:,-.i"-1;1#
itY);
ffiXJIT:lffit[";ilT':jff;: these nrms as

il-"h^':i:-
*: playing a significant role in :
their shong oo-"iir" ,na.r.ets and ab,ities

l;;
ro
;?,*:rT'q:i:.::::5::99_rl?-Yq, uonEroute: gain capitar ro,:n wrtru,ltheir hc,s,
:;ilr"ff;1?*Ji#fi
rost countiies
counh.ies
:3,i :; :,'l:,:Yl6::y"':';;t;ii*"
national and'sub-national goie.*rh"ots
to an oveiall of global
reginnc p,rivincos
as regions,
srr"h corporate,reach,'especi{lly
^_, cities. uNcreo ;'i:#:.1"::i;r:'J","4,il:"t'H
-.A,,.i-^^^ Ld
lexPansion
when viewed i.
in 2010 identified at least 650 ,orrn-rou[;;;;, anfl theirpropensity to
state-owned il
vrith more *,," s,iod iavest i:: so-ca,ed GreeiLfieirtvnnh,r.ec
ll3?,:f-:"::llig*
ffi[.;.1*;11*.
which y:t; i;
;fiI'i?f Tfl"",T;i{;:J?H;#:i
;-:,y: ::1g1,"i"r{ ;:TJ"*:i il XH:1,$[1trfi,in#::
34s: (t2 8G'qull:".r
countrieszdndt 235' (36. pe1
cent) iu esia] new operationar facilitids
/,h-r

stotejowndd c0rpoihti'ond"gq"r."**tuurv fiom the srourrl

vlt otrr", focus
in structurE'anit turidtion uy
all chi*a'' hds rthe largest'number,'of
"ouotw.
or"i- "pl ""r""*g
,J.l*irr'i*r* r*""1u1"';:"H
on nltional
;T:Tl
corpo.ations that arer completeily
such tions to priviiege theq host counhy for
' *l;: national security reasons) and issues of trans-
I?fi',;"TH"'#f"in,::n
onrv a smau perceatage anains
the status
global corporations TLTNCTAD-WIR,
of ff*
::i::: ;,';ffi{ ?dL;i;:#,H:
1;. r"^'TJ.::t
!f;lil"L,ilt j#.T?;Ll;
3c- l) 'zo r i
ln many other countri"r ii-" -*"r,, guidelines fo, go,r"*urr"g within
state ownerl
corruno, to have a maiority of
enterprises
,r*ai"g
orto has
farned rhe issue as
state funded
:lt'j#r#,r1oos
__ -l-,.
i'u'ing il;#;;l "l.r"rJJu.*.*
siblitv. a*uauv
the state,s respon-
ror actiJverv exercisirrg its
. ownership functions suc{ as nominatioriand
I
 276 THE SAGE HANDBOOK OF GLOBALIZAION

rt I l'ii
election of the board, while at the same time of relinquishilg-clemetrts of.control; and at
refrairin-e from imposing undue political reduced profit levels. NEMS constitute a
interference il the management of the com- significant portion of global corporate activ_
pany' . t his report also emphasizes ity within, emergmg, econgpiqq,,fotal saies
the need to ensure a level playing freld on rh.grgh suc\ anangements in;20i0 is,esti_
which private companies .uo .orrip.t. ,u.- rnated to havq fpached;Us-$2 trillion; contraot
cessfully rvith state.owned enteqprises while I manufacturing,, and,, iservices r Outsourcing
not distortilg competition by, the use, of approximated US$ l,i.rl
.
13 tilliO4 ; fitrshis.
state regulatory, or supervisory powers ing US$330-35O biltiG licensing:trjS$340:
(oECD,2005). : 360 biliion,, with :manageor0nt. hdd cdnffibts
Non-equiry modes of producticn around US$100 bi.llion.: Collectively I.IEMS
GVEMS)
have become an itrcreasingly irnF66so1 1or- employ between 14-16 ariilioh woikers,,ln
of global corporations witbin the qnerging some counties they:accormt for up:to,,lS oer
economies. The traditional.mode of organi_ cent of GDP .and:iinisome. ,inarst-i"s.
zation for global firms jpthqse econorries=,qas
they.account"for 70-E0 per cent,of exports
through FDI,.which manifested itsef ttrrcugh
equity holdings gnd crea.lecl, strrctures by The ..relativei, impgrtance .of :NEMS ,,to
u'hich parent firrns,,owned and,directly.man-
bqth,,tbe glsbah eponomy, ana tib, st*"tor*
ageC their subsidiaries - an organization form
and go vernanoe rof globalr.corporations rin
,
known as intennlizallon because control aud the future is suggested, by how,,NEMS
nsk reside with the parert, as do the vast groqth has outpaced.that,of,base,industry
rnajoriry of revenues 4pd profits. Ilowever, growth in : electronicS;r pharmaceuticals,
througbout the latter fwentieth century period
fbofwear; retail,, toys and rgaiments :, in,et e._
of veitical integration of gtobal value,chains tronics the ratio is 6:1 ,and that of garments
b1, advanced economy global eorporations,
1 ; 1 .,Referencing, contract
op anufacturing as
the 'seeds' of aon-equity.relations iad been an. estiglated.;share of the, costrof go-ods
well established:
sold,, tqys ,and,Bportine goods..led aqiO per
cent. followed, by rconsgier, elec.konics g0l
... how and whether firms can.capture value per " cert, . .autqmotive,, 6&i,A0 :, peri cetrt;
,

depends in part on the generation..no,"i.niion generic " pharUraceuticalqr

of :cmperencies (that is, resour.ei) that are diffi- :4 0, i,pdr" cent,, and,
cult for co.npetitors to replicjte. ln practice, even b_r3nd9d,pha'rmaceu.ticats,,2b pr,,.."ot.
tre nost verti:ally integrated firms ,;r;y (LINCTAD.WT&, 2Q li :: 1 34),., In sibr,t,
ize all the technolbgical and manaqement
;i.;.;l arrangements are growing at rates substan_
such
caol-
biliti,es thai-are, required. to bring .-a product'to tially in excess of, the industies- within
:rarket ..-. tf an input, even an important
.equired frequently, one. is rvhich they exist. Overall this implies-thai
thEn it will li(ely n. a.qrii.J
externaliy'. (Ge.effi, Humphrey .nO St.*q"on,
,n^q\
\v!J)
11,.*:rtTt econo,mies many fimrs speciat-
thes e
f-lnC,^n -rglatig-nships.,ryill r-thems e lve s
become yery large.firms emptoying,many
;
thousands of workers,vrith,hundreds
NEyS an increasingly vast net- of bii_
work ot-represent lions.- of, dollars of annual :revetrue (such
relarionships in which global pro_ :as
ducrion charns are assembled ,h;""gh Forconn/Hon,Hai, (China) *ith US$;.;
;;;- r?1:r aud 6li,000, emptoyees;
tract manrrfacturing, services outsJurcins. :il1,oo T
riexronics
conn'act fam:ng, franchising, (Singapore: US$30.9 Uiitior.
licensrng an7
mana_qement contracts. l.lEMS
are ,iewed as
jor,rry -.Sqtoyees; LG Chem (Republic of
extetnalizdtion for the .orp"r",io", Ko,:ea: US$13.1 billion and g,0gg.srrr1.r,-
gai-os access tc., benefits
w}i; )J, (Reppb ic, of, ror" u,
ryt,ht";;;;;l;;; ,":"' :I ;H,{TS"i Y99!
u-rotl.l f
chains withotr.t the direct i"u"trri"oi Dlllton, 6,000 employeps) -:;2009
of .oi_
parable amounts of capital,
uru"it ;;;
data (ITNCTAD_wIR,
especraUy those
zorii. Mani,
within less intensive valuu
.il;;
"i,h.
 !-l:

li,
THE RISE OF TIIE
! GLOBAL CORPORATION
i' 277

small even as
,fj;t#:'#1T:iffi"""'tThese quickry and wirh

t
aikngwledged hieh .,uar_
data srrg_ lty elevareJ arri"-i"rn
*.,,,i.,"*iJu il :H
sest thaf ol^r."r
ffijT:;
^^_^tw. ff :: : if;[1,.* T,tr *Tj
thp r.,^_r:,- r
#ff:
f1; .g,*,
.,

i',
[.3igtT:T{1,T",Hff1,*l,T'.,ffi "ur" * ;"'.o,i,,'
*p"at"a ..rrr.i.,,s or
ljl:-[i.lu "i;;i, conror, pront and ii I:::T"?]:::yn'ei{."1iq;ffi;: ;i
:.'.

.l ::il" .,1y*;,;'-'-l;.il#:i
- 'E'4vu ur txc[ange tol
engagerrlgnt in intrir-comorate
tgsue
orgrobar impoit
fbr
I
both ;";;;;;;
--"'vvltlvqttts
op-
arr2h

::H $::Jff:"*' 'n"i' i*,;d;ij:'": ]l:,T.r"l-rytryg9 jrxr cHANGTNG

i

o_r
:h.ild" eroiur trrin ;,
lorRorati ens
i,vi
I
iif{:lfliff fIfrrJJ i;n;
H
,,trJ[:'5#,'d'"',i:f;
::',f;,rff;*,i::iclir-eilc;,iill"ni1om
:^::.ulr
India)
of growiag national p"*;;;'il;

[Hfi ror,H'
tn" ,r""a to-ul-e
"'"::r]*:
gi
\Es 'r vrur4
national caniral,.r^ __:--ry:-g"l:
and deploy
#
;il;: ano operates
H:H']1fl"e:rT:r,r"".
tlu.oughoui *urorude
:

e of regions
I

I;:'",,;i: :-anJ:
-il"' its trolt en'i.r.o*rent
within
.-r
reoinnc and
:::';x1""T::1::":r'f,.-:;';'*';:i
economic devetopment- wr,"rrr",
*,,i"i[ :ffiffi[ ffi :ilr:tff
ffi#:::rT#::: :fl"TJ,T: ;:,::,1
;H::,,:::r:[Tj
firn:s,
or state a"ar,-
such as manv chinese
rt.t.i regulatory environmentd that frame ir< n^o,o
";*rr"il
tfjfl:'"tr:;:j:'-H:'t'G;Jdli
;'"fl'Tffiil?ff?ffil1,,l':ffi,Ij,:ff,:;
::,:1'',pp iv,"' ;;l!;; ;",,:i,f ;,"::_1 H:"ilj:'y ;ilj lT'J#"$::ff .J:*, : ;
this acrivirv is urtimatery denned Anrr e.,,-

iltiil:.T:1"-:::,:yn1f_inveliirghJ",,y this regulariou emergds frorn rhe or^h.r

i';.e$:1"::,*:rl1l
Austraria aud Africa). +;#"(xil;'il :H"#*'fi:i"fffiL,T".::i:"
a'".o,a'typ" Jr ;fi:T:ffi:i:;: #,ULtT?iI"f,.""r# :ffl
::::lllfiHiffi'ff :o "nti'u*ri,..,", ;rurj;;'il ",,i",.rq,",1,ed the path cre.
-o.Lj*- ilil;;; ffi#: "r"a *u"ro
devercping
devel.onins markbts _:^"Trdeveloped
aud by *uJ" sEuctures srrch ac rho
T;[J#;ff;::";
it=? t'*ii;h;" il.3#,:::
iillf,H;f#l li;:t:"t"i*r"i",lJro" (GArs), change ro
ffi ryajor rhe
*:1190,:ig ":::, i;",#:T
f.""C,, o'"+iirr,, c+eraLA.qree,nent on
up, riorn ,78 ih
;8,rffi"], ". .*^l::,.::":i"::
j".A,T1ly:'t"ii
:ft 3:i market
grobai
I;
p,.i,i,,
signin"#;;,k",
i"". ;HI?ffi
i#ll8iflT::l
lffi"ffil,,Lfr
tT,,ffJ:::
lX,TlY::::
witr
etratron on all continents, ;",_ #d#"8::ilffi:j:b:tffi? HJ,H:
f.IEMs r.prJ"r, penod, portions or ,rr. qo.ra _
most specifi-
,},r"rJi
}j;.,*H:rl1II:Y:*i", ""* cauy Asia- have experrjencerr a cimin^o-,
,:i:i:1",*:"*F"'o*-ifii#r"ffifi
raarket rirnas,has' be*" ;1"#x;r#;:;xiFn:::*::-:'.Tl
g:';il,G;rffi :i,:--S as rhe
rapid iacrease in size ana
unnen.;:ffi;
"T:".,"ents B,H":f: ff1 of both
finisherr nrnrr,.^io "-it'J:^,::9:cer
:X,tTffi?i",ffi:f"Hffi:'*::::ffi ;'"'11"""ffiT#[ip:tr::?.'":?ff :
u",r,.
Xl ,Tl,LT;,I::i'^ii,"""ir"iu,*^"oilij- :i:,ifftJ:fr,;"lfffitlg.*,u.n,
tage itr both grobar and
domesti. "Jy;f ij,,o,9il;,0.,, ,n.
',;;k;;, :Ti:'rt#f;::
,resuratory
or superior ihiovative i:
;::"11.:1":,1TT::.:::: ?,d ".pi;;: dynamic,, ab ir arrects p,ohr
tion
,"rrr""r"gr. in. ":"S'ffyrr:i:lH;,r$,.X i:$t:.,:,.^r"i]
::Jl",J1jT,;:;,H:f::T ffi;it m :--. :::.1r",*andlffi1
o;iil ffi i;." J:::
combination
comDtnatrOn Of of Apple'S
ao.,].,. Own ;,.-^..^.:-.- ":"' erru
Srcsslve stcady legu{atCly
JLs4uy regulatcry movelneut -or",r-,",.,, ,,
ar
^r,h iunOvative
rechnologicar .upu"i'ti*;j;;;.ffi:;
Itres to adapr production
changes
il:
*r"ii".]y
:,!t :,::l"j:::itTiJ#fil
.rarion of iavestrnent co(es, ,,ade rules
,,il.li.liA?_

and
278 THE SAGE HANDBOOK OF GTOBALIZATION

operatlng nrles to reduce barriers to global

investment and trade (Steger and Roy, 2010).
Embodied within neo-liberal beliefs and
policies, this thrust toward liberalization has
accounted for regulatory environments dis-
turctly favourable to global corporate invest-
ment and. vdlue" chain developmentA across
the spectrum of,gorids.and sofvices, Asecbnd
thrust has resulted fi:om.national regulatory
changes targeted usually at, specific,indus-
tries or investment patterns. In 2010, tfNC-
TAD--'\TR (2011) catalogued such regula-
tions fcr both developed and developing
countries with respect:to their effect on FDI,
f,rnding that 7 4 favouraple changes,facilitat-
rng entry and establisbment, and the,opera-
tior of capital (49,of wl.ich.wqre ia develop-
ing countries) and 49 less favourable to FDI
(with 34 of these from developing. coun-
tries). If one looks at uational regulatory
changes by industry'with respect to their
relative Iiberalization or restrictive Dature,
with the exceptions of Agribusiness and
Exh'ac tive Industries the s i gn i fi cant maj ority
of changes has been in the direction of less- chlngfg corporatg, !
eneci regulation(JNCTAD-WIR, 2011 : 5). 20 Ql; .6
2,, ciled,in
Levy
A third source of regulatory effort has rln recenl
been the sigaificant rise over the past dec- posgd. a, sret of, I

ade-and-a-half of corporate,social respon-

sibility (CSR) as a self-regulatory pattern
tbat has been brought to global ccrpora- et al.,
tions in an effort to reDder them more
accountable across the range of their many
and varied stakeholders. R.esulting in iargl
Ilart fi'om the cumulative effect of more
than three decades of intense crir,ique of
globai colporate behaviour and its varieci
negative coaiequeaces,
,CSR repres_euts a
rvide rangiig set of.proposed governance
structures, including rules, nomrs, codes of
conCuct and standards developed'iargely
by the global NGO community C.r;;
Kaplan, 2OO7). Various empiiicat studies
over this period have sought to evaluate
efforts taken by giobal corporations to
develop greater degrees of responsibitity
over global supply chails, particul:arly
where deficiencies, often with respeqt to
occupational health and safety, have been economy
 THE R,sE OF THE
GLOBAL CORPORATION
279
regulatory tool,
aggregarion uodt^i:.":"ul, yi'h the iatense which grobar
n,*.lur.up;i[:",^i!,"[Ti,yffi
the system .ilT:]pn,".r.i""",eifl",1iniffi
(stigritz,20r0). '- -"arour€nZt trending
.ffi j::
:;:rr"l:rir]"".
ure oata on global. "if..,.-'6u.r,rt,
inequalrty measured
THE NORIIIAT|
t*' oBA'
connon4ii;;Ir'
At
RE: Gr
#:l{:itffifrfi,;trl
nibuted borh berween
*o *rrm .l;:#:,
as qhe richer
least since the
case for gliibal
early 1g70s the norma . r
:'otner aPafi
comnJri;:::,-1^":'ornatlve from the pooi".- *",tJrri,-".;;
ena; ;:Jil;*l;*?LTilJ#
:ibt: tr*Hi###;1#'i*ml
*"n* ffii,ffi'; i{ii.,::'li: "'d JSI'!i:i' ;{# ;n,
nrres surro.dndins
* s. "a;;;r:
c .q,!
b

"
,,,. ."ni*iii;ffiI,1#i:'*r*#:,#f-, o"*r"olir'"Iui,,,,", js ;
continued ."ono,,,i.

$*1,8**1fi*T;$#t rfi: "et il:3ffiHZ,',';xru[:r ;y,

nomicdever"ril":l..Tj.diffi
sought after tluoughout *,.iirtr'"":,"#.'J"#';n""J""#,il"1,1",i*ni
the world. rro*!r"r, ,*_l^.0_i.#fuuon,
offers ,tr**gty
;"",",,,_each
1!E:"fl:,,:li,:i#"^?;;;:ll ;:,*,^*;;i;:
nornic prominence through -";;-;":t exchalse rates, the top quintile
(20
measured in ma,ke,
pe.'Jentl
"
;i.i"il'.i !i'frTf;I#,y,:'t;:}",:t: ff?j#r:r;*? ff r".*,,.";s:r:
fl.il!ip,::
io",,"a
T*":'-T e"i"'i';o;" J',-,fiffi:'H:ff:Ill:rHHtlg*U
'+
oi-*";;,T":f #r#*:;:::, (ozr:. top quintile to 2 6 per
porarions as agents
orp sv't"- tiltffi;:: i,'i',.t"1! ffi,#lrl:t*jttr;r,..]*
";"ii"1.the

;:J::}1Hfi,?il:i,'.,n"|;:H:lT.ffi,n - dispariti", s#ir,heir resurts arso sugges t

protection, prosress
cegradation, pro-
"";"";";,;;":ffi:,X;J
ar.i"g rut orlii.Ilf,t*q 11,_::::t o*"-uer, is taking prace ror th. u.,y
;l;: .poorest;
corForare
ev -r-!v
trr. sruggiih pace v:
or"t u,.g.
erra'(r'

threatened"ouurroo,'ii;t;"T#"LH::: u:utdnce: " 'r*-f-r"".""0r"0,",

national -;;,:j:
jl:.'., y]*t ilTJ:.I":?,tyrff]ffid a,ins the rare or chanse Linder the slooar
lf*ii"t
rate
crisis is the rbrelt
sruc[ures,
o" ,.ii""",p": ilT;'iji:#i"l [1n.T:i*., .,.n."n. -].,, ,,
bottom brllion
ouerating i, *ra"*i*i", their share of *ortd'9 Io irnprove
outside the reach or
erective fou"#fli ooints, rrorro.;;
;.,.t::,lit"oii;l',:T;;,:?:
::::::l ,- national,
consritute an
regionar ;r ;,;;i: cent in 2007 ... at In'
speed, it wourd take more
;[iliriilil,,,j.'n(_8ssvu.,.r i; ;;;;r;;;; ;"
"conomir. "o"""rr.IiiJ"'
wealrh and power
sufEcient-to-;.;;";. "r
; ,ncome (20r1:
i9)
,ve ten per ..n,
s"ro;r]
"l
cf proportion, m"i Jr#i.t"
ljl?:l-::,:, of existing mectunisms
::l::'V
ance ro remeciy fSri"gtio,
;i;;;: 'gtobat entities,are
ZOr O;. Y*l:::._r*er involved
i r.rrl many points of ln rnIS paliern of rvealth
, view the extenr ro creation ara aisrri-
which wealth uod io.o
ro bc jacreasiog trro,rT'
inequarirv appear :JffJ
"rtii:"iJ:[:JT:n.m*
j*
gests rhat ;*tiIn".-il:1,:il",t::::-
mative' balance -rrii, .ristnu,,t.sgto#";urtrr: rhe rote of rhe
or a'""rofrr,.,,t ;frHH,t:,#,t#;fit::"t.:..o*fi;
280 THE SAGE HANDBOOK OF GLOBALIZATION

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I
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"U !0:December. 201 2).
and Shaw, W (2911) ,iu,ggeiait, Uo*'
structurps anC operations of global a0iporaiions?
tmerging Markets are Reshaping' Civitization,
2 Has the rapid growrh of global corporate capital-
Washington; DC: Cainegie f ndowhent for.
,i
ism\led to a diffusion of in{luence in the globat
lnternational peace. .
econo;ny? .
Di Crauwe:.P. and.Caihermin'F (2003IAie mUltiinatisn-
3 To whct extent have global corporations become
als,reall,y biggerthan nations?
less requlated? lkortd,Eioigme 4(21:,
.tl ,2147t. i r.r:irii .:r .,.i, r ,;,.iilrl;lr.: .r ri,., l
,.
 ffi ' THE RISE OF THE
[r' GLOBAI CORPORATION
!';, 2a1
!,:
, *::r,,!-::!:t), Rote
nl', reversal: Emersins-marker
firms
[l,$l' buvins rp'i.i,*o'rl' "zi lwan L (20'12) Drfference
be&een a gtobal rransndlrJndl
{'ii.- i::,:T[:t'!'])/ on., rnternational and
muftinati,
+{.-
Y,:f,
ilaG
uii,
|ltr:/il;;;;il; :.iff ,d #il:ff ,::
oetween _a _g
loba I-treisnaUonal_rn
terna tion a l_a n
[:. o_

,,,,y,!l'liT;ff "#;:yt;;;:i:,::,,*;lil,
fe

{:
il;
;;;.i;;;r;;;i,
he.
n ,t 9rowing Chalenge of iore,S,
ii -r::fl:f:r:*,
erowrh of transnationat corporate
i';,;l i' ;;' ";:);:;i::,1;i
[:;r;1,it,0,.c ;,;:;;;:;i:;,;ffi",x1;;' ;:]I:]" ;i,,,#
' ':;,;r'T] Jn'.r;' JvlL:,':?1:. :::i";ili]ff:l
Tlii+l ^ilrJ'jrydlf
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i'r,. .ir.o,ln,.Rashubir
of corporare sccrar
!;!{;^ff1flffI;1;;il:;i;;: ilIll'?JffiI,
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