4.4.1 The Impact of MNCs

• What are two challenges MNCs face when implementing CSR globally?

  Cultural differences and varying regulatory standards
• What are Multinational Corporations (MNCs)?

  Large companies in multiple countries
• MNCs operate in numerous countries, giving them a global
• MNCs are centrally managed from a single headquarters.
• Match the organizational structure of MNCs with its characteristics:

  Centralized ↔️ Decisions made at headquarters

  Decentralized ↔️ Local subsidiaries make decisions

  Hybrid ↔️ Balances uniformity and adaptation
• What is an advantage of a centralized organizational structure in MNCs?

  Ensures uniform standards
• What is a disadvantage of a decentralized organizational structure in MNCs?

  Potential loss of control
• Order the areas where MNCs have a positive impact on host countries:

  1️⃣ Economic

  2️⃣ Social

  3️⃣ Technological
• MNCs provide foreign direct investment (FDI), which boosts economic growth
• How do MNCs improve social conditions in host countries?

  Develop local infrastructure
• MNCs contribute to skill transfer by training local workers.
• MNCs bring advanced technologies and new production methods
• What is the role of MNCs in knowledge diffusion?

  Share knowledge and expertise
• Why are MNCs vital in global trade and economic development?

  Provide foreign direct investment
• MNCs own substantial assets abroad
• MNCs have well-known brands globally.
• What is a negative economic impact of MNCs on host countries?

  Exploitation of resources
• Over-reliance on MNCs can lead to economic dependence
• How do MNCs contribute to cultural homogenization?

  Dilute local cultures
• MNCs may exacerbate income inequality by attracting skilled workers with higher wages.
• What is an environmental concern associated with MNC operations?

  Environmental degradation
• What is one negative economic impact of MNCs on host countries?

  Exploitation of resources
• Host countries may become overly reliant on MNCs for economic stability.
• Cultural homogenization by MNCs may dilute local cultures
• What is one environmental concern associated with MNCs?

  Environmental degradation
• MNCs always pay fair wages to local workers in host countries.

  False
• Cultural homogenization by MNCs may lead to the dilution of local cultures
• What is one example of environmental degradation caused by MNCs?

  Pollution
• What is a key economic impact of MNCs on host countries?

  Exploitation of resources
• Host countries may become overly reliant on MNCs for economic stability
• Match the area of impact with its corresponding effect:

  Economic ↔️ Exploitation of resources

  Social ↔️ Inequality

  Environmental ↔️ Environmental degradation
• Where is the headquarters of an MNC located?

  Home country
• MNCs often maintain high-skilled jobs in their home country for research and development.
• The repatriation of profits by MNCs boosts the home country's GDP
• What is one social impact of MNCs on their home country?

  Promotion of national brands
• What is a key characteristic of MNCs?

  Global presence
• MNCs are controlled from a central headquarters with centralized management
• Match the organizational structure with its characteristic:

  Centralized ↔️ Decisions made at headquarters

  Decentralized ↔️ Local autonomy in decision-making

  Functional ↔️ Organized by specific functions
• What is a disadvantage of a centralized organizational structure in MNCs?

  Slow response to local markets
• What type of management do MNCs typically use?

  Centralized management