multinational corporation

Company or enterprise operating in several countries, usually defined as one that has 25% or more of its output capacity located outside its country of origin.

The world's four largest multinationals in 2000, were Exxon Mobil, Wal-Mart Stores, General Motors, and Ford Motor – their joint revenues were more than the combined gross national product of all African countries. 22 multinationals made more than $6 billion profit in 2000, and Exxon Mobil made $17.7 billion profit, a 124% increase over the previous year. The value of mergers and acquisitions in 2000 was estimated at $3.2 trillion, the most notable being Pfizer with Warner-Lambert in a $116 billion deal, and Glaxo Wellcome's purchase of SmithKline Beecham for $76 billion (to create GlaxoSmithKline).

Multinationals are seen in some quarters as posing a threat to individual national sovereignty, and as using undue influence to secure favourable operating conditions. In 1992, it was estimated that the world's 500 largest companies controlled at least 70% of world trade, 80% of foreign investment, and 30% of global GDP. The 100 largest had assets of $3,400 billion, of which 40% were located outside their home countries. Unsuccessful efforts were made in 1992, through the UN, to negotiate a voluntary code of conduct for multinationals, but governments and corporations alike were hostile to the idea. In June 2000, the Organization for Economic Cooperation and Development (OECD) issued guidelines for multinational enterprises. The guidelines, drawn up with the aid of non-governmental organizations (NGOs) and trade unions, aimed to promote better relationships between multinational companies and the societies within which they worked; similar guidelines introduced in 1976 had proved ineffective. The OECD also called on multinationals to respect human rights and work to eliminate child labour.