European Multinational Companies Research Articles

The effects of shaping employee work engagement and job satisfaction on company performance results: the mediating role of HRM outcomes in Central European MNCs

PurposeThe main goal of the article is to determine the mediating role of human resources management (HRM) outcomes in the relationships between shaping employee work engagement and job satisfaction (SEWE&JS) and company performance results and to establish whether there are any identifiable regularities in this scope in the pre-pandemic and pandemic period in the headquarters (HQs) and foreign subsidiaries of multinational companies (MNCs).Design/methodology/approachThe empirical research included 200 MNCs headquartered in Central Europe. The raw data in the variables were adjusted with the efficiency index (EI) to capture the actual relations between the variables under study. The partial least squares structural equation modeling (PLS-SEM) was used to verify the research hypotheses and assess the mediating effects.FindingsThe research findings show that the HRM outcomes positively mediate the relationships between SEWE&JS and the company performance results. HRM outcomes turned out to be a stronger mediator between SEWE&JS and company performance results in finance and quality in the HQs during the pandemic. By contrast, in the local subsidiaries, they were a stronger mediator of the relationships between the results in innovativeness and quality during the pandemic.Originality/valueIn addition to confirming the results of some other researchers, the research findings also provide new knowledge. They determine the mediating role of HRM outcomes in the relationship between SEWE&JS and the three categories of company performance results, namely finance, innovativeness and quality. In addition, they identify certain regularities in the four studied contexts, which is a novelty in this type of research. A novelty is also the use of employee key performance indicators (KPIs) in the data analysis as the efficiency index in analyzing the effect of the variables under study. The value of the research is also the fact that it covers HRM in MNCs established in Central Europe, which, compared to MNCs from the Western world, is not a frequent subject of research.

РЕГІОНАЛЬНА ІННОВАЦІЙНА СИСТЕМА ЄС

In modern economic realities, the formation of regional/territorial innovation systems, or «innovation ecosystems», is one of the effective mechanisms for intensifying the creation and implementation of new technologies and innovation strategies. Within the framework of the modern regional innovation system of the European Union, the object of its functioning is the space of development, the goal is to expand through open access and support high innovation activity of participants, and the result is to enhance positive practices and effects. The aim is to study the role of the regional innovation system of the European Union in the development of the innovation market of member states. The research methodology involved extensive analysis, synthesis, comparison, and generalisation tools. It is proved that in the modern innovation market of the European Union, a kind of multilevel hierarchy with different institutional conditions has been formed. It is determined that today the degree of «network integration» of the regional innovation system of the European Union into the global innovation network, its place and market position in the global value chain is determined by the share of value-added created by the country/region in its export value. It is noted that European multinational companies are an essential subject of the European Union regional innovation system. The article analyses the concept of «smart specialisation», which is inscribed in the European Union innovation policy. It is concluded that the modern feature of the European Union regional innovation sustem is the active use of the technology platforms, whose major competitive advantage is the transformation of innovative tools of the technological process into market control tools. As a materialisation of holistic technologies based on fundamentally new scientific and technological results, technological platforms are an ideal communicative structure for improving the original idea through multilateral collaboration. Within the regional innovation system, the European Union’s multinational companies are now the owners of leading and highly efficient technology platforms, successfully forming key network nodes and structuring innovation-production and information-communication processes.

Securing collective representation in non‐union European multinational companies: The case of Ryanair pilots’ (partial) success

AbstractCompelling a recalcitrant employer to cede its staff independent collective representation has always been a fraught and difficult exercise. It is an inordinately more complex task when that employer is a multinational company that is capable of moving its operations from one country to another with relative ease. For workers to be successful, requires that they and their representatives coordinate their organizing and mobilizing activities across national boundaries in a manner that they have rarely been able to achieve. This inductive study examines one such rare example – Ryanair – and investigates the basis for its pilots’, albeit partial, success. Its contribution is the explication of a causal model that identifies a set of institutional and structural conditions, and agentic actions that led Ryanair to cede its staff union representation, while also pointing to the limitations of the pilots’ ‘victory’. It ends by identifying a number of changes to Europe's institutional and regulatory architecture that, if enacted, could help the workers of resolutely anti‐union MNEs secure recognition for unitary pan‐European structures of representation.

CORPORATE-STATE MODEL OF VENTURE FINANCING: EXPERIENCE OF EUROPEAN COUNTRIES

The article is devoted to the model of venture financing, which reflects the country-regional differentiation and its key distinctive features. It is noted that more than 40% of the largest European multinational companies annually allocate quite large-scale financing for the implementation of corporate venture programs. Among the factors that determine the high efficiency of the corporate-state model of venture financing, it should be noted first of all the high level of state regulation of innovation processes, the presence of large industrial companies with their own research centers and departments, and a developed and highly capitalized banking system. an active strategic partner of the business sector. National and regional innovation systems were formed as a result of complex interaction of scientific and technical, technological, socio-economic, political, legal and institutional-regulatory factors of innovative development of certain countries and regions. At the same time, the most decisive influence on their formation and further evolutionary development was exerted by scientific and technological determinants, which together form the global configuration of venture financing architecture and ensure effective consolidation of real business capital of some business structures and intellectual resources of others. Venture financing models provide large-scale development, implementation and use of the latest technical, technological and information tools in production and non-production areas and focus on the maximum concentration of material, technical and financial resources in the highest priority areas of research and development. This strategic goal is most implemented today in countries with a market model of venture financing, where it has long proven its high efficiency as a significant source of innovative development. At the same time, the deepening of techno-globalization processes gives a strong impetus to venture business, transforming it in line with global economic trends and stimulating scaling up and diversification of regional and sectoral-sectoral structure of venture capital.

Due Diligence and Environmental Damages Under Rome II

Within the European Union, the Rome II Regulation determines the applicable law on cross-border matters of non-contractual nature. The paper examines the applicable law on environmental-related tort claims against European multi-national companies utilizing production facilities in third countries, either based on active misconduct or on alleged omission of environment-related due diligence. As these types of claims are an expression of misconduct by multinational corporations conducting business abroad, particular notice will be given to the applicable law on compensation claims for environmental damages allegedly caused by negligent compliance for environmental standards of either independent or subsidiary production facilities. While doing so, its main point of interest will be whether claims against European-based companies may be governed by the law of the effective seat of the latter. Considering that Article 7 Rome II provides for a special connecting factor regarding environmental damages, the paper examines whether Rome II does justice for due diligence-related cases on the conflict of laws level and argues for a nuanced approach to localize the place of the event giving rise to such damages. Private International Law, Environmental Damages, Civil Compensation, Torts, Corporate Social Responsibility, Rome II, Mandatory Rules, Public policy

Investigations Regarding the Linguistic Register Used by Managers to Convey to Stakeholders a Positive View of Their Company, in the Context of the Business Sustainability Desideratum

This paper is based on an analysis of the content of management reports (annual, integrated), on the activity of European multinational companies (listed on the Stock Exchange). For this purpose, we conducted a content analysis of company management letters which open integrated and annual reports of European multinational listed companies. The data comprised a corpus of letters and statements of chairmen and/or executive directors in five environmentally sensitive industries that were analysed using Wmatrix4 software. The identified key words, the preferred semantic domains and the tone of emotional register from the letters of managers provide significant evidence on what kind of information they contain and how these managers want to share it with their stakeholders. Our results show that managers are interested in the optimistic presentation of the mission, results and future plans of their companies. We found that words such as like, confidence, proud or trust are common on the emotional map of these letters, but the preferences in use are unequally distributed among the five analysed sectors. We also report that the word “sustainability” is among the key terms found in letters and statements of managers. Finally, for each of the five corpuses, our study proved that, beyond common issues, different economic domains prefer different topics, using a significantly different lexical register both in terms of relative frequency of common key-words and diversity of words within the same semantic domain. The study systematizes a set of key-words and semantic domains used to convey positive emotions, avoiding those with negative connotations, in order to provide an image of a company that acts in a sustainable manner. This could be successfully used by corporate communicators of a wide range of companies who want to comply with the best practices of integrated reporting.

European Multinational Companies and Trade Unions in Eastern and East-Central Europe

The fact that multinational companies operate (MNCs) in more than one country can be expected to lead to a weaker bargaining position for labour. However, there are hopes that these companies may, under certain circumstances, transfer good employment practices from their home countries. This theory is investigated for the case of MNCs based in western Europe that invest in the countries of eastern and east-central Europe, where they dominate in several important economic sectors. The established legal and institutional frameworks in those countries give a degree of employment protection, but it is limited. Union recognition by MNCs is quite common, but collective bargaining often provides little beyond existing legal provisions. A series of case studies shows how unions can try to, and sometimes succeed in, getting better results from bargaining. The key conclusion is that international solidarity, contacts and publicity can help unions in host countries, but the ultimate determinant is the determination and organisational strength of employees.

Cross-Border Standardisation and Reorganisation in European Multinational Companies

Multi-national corporations (MNCs) are constantly undergoing a process of standardisation and reorganisation (S&R), which is fuelled by the rapid development of information technology (IT). These developments require an in-depth and systematic inquiry as they have serious ramifications for labour and workers’ participation across Europe. Moreover, there is a lack of systematic research into the effects of these new, and especially IT based, S&R measures on the quality of labour and labour relations in European MNCs. This report provides a comprehensive overview of new (and renewed) SR 2) the critical role of outsourcing for standardisation processes; 3) new developments in HRM process standardisation; 4) IT-based standardisation; 5) standardisation by Big Data and Industry 4.0; and 6) compliance-induced measures of process standardisation. In practice, all six trends often interconnect to exert a strong impact on labour and labour relations in contemporary MNCs. Hence, the report explores the critical impact of the six trends on labour and workers’ participation across Europe, and also addresses their interconnectedness in relation to the powerful managerial rationales which trigger the observed new (and renewed) S&R moves.

El comercio entre la UE y los asentamientos israelies: cómo los acuerdos técnicos suman injusticia estructural en la cadena de suministro

Hace ya más de dos décadas, la UE actualizó su comercio preferencial con Israel. Muchos Estados miembros de la UE y multinacionales europeas violan las directivas de obligado cumplimiento de la Comisión Europea que excluyen a Israel del trato preferencial libre de aranceles aduaneros. Este artículo defiende que, a través de la imposición de un entorno coercitivo en los territorios ocupados palestinos, la economía de los asentamientos está relacionada con la injusticia estructural de la cadena de suministros. Muchas multinacionales europeas comercian en asentamientos israelís y contribuyen de manera parcial a la injusticia estructural. La Comisión Europea aborda la injusticia estructural en el marco de acuerdos técnicos, sin embargo, este marco es inútil debido a la desconsideración y la mala fe expresada por aquellos actores relacionados con las empresas presentes en los asentamientos y a la falta de normativas estandarizadas en un marco operacional y responsable. Este artículo desafía un argumento muy arraigado en los estudios publicados, aquel que defiende que el problema en el comercio entre la UE y los asentamientos israelís no es tan solo una disputa territorial y fronteriza, para ello utiliza un método combinado de bases de datos y análisis discursivo.

Profit Shifting of European Multinational Companies and Corruption

Profit Shifting of European Multinational Companies and Corruption

Global products marketing strategy of two European MNCs in Vietnam

PurposeThe purpose of this paper is to analyze how two multinational companies (MNCs) faced the challenge of market uncertainty and political instability in a newly emerging market, and how it affected the impact of their product marketing strategy (PMS) and product (brand) performance.Design/methodology/approachA comparative longitudinal paired case study of a market entry by two global MNCs. Twelve global brands (products) were studied, which were locally manufactured and launched by the two MNCs during their first ten years of operation in Vietnam.FindingsThe authors approached the investigation from a conventional point of view: standardization versus adaptation. The results showed that in addition to these two traditional processes, a third one was also operating, which the authors labeled semi-adaptation, or the midway PMS. Semi-adaptation refers to a product that has been introduced to Vietnam from a neighboring country.Research limitations/implicationsThis research is based on two European MNCs active in the food and consumer-household goods industry in a newly emerging market: Vietnam.Practical implicationsThis primary data indicate that the product standardization, semi-adaptation and adaptation process in practice is a technique applied to fit a product to a newly emerging market more by degree of change than by product category.Originality/valueThis paper supports a recent stream of research, which views Standardization or Adaptation as the two ends of the same continuum, where the degree of the firm’s PMS can range between them.

Political economy of Huawei’s market strategies in the Nigerian telecommunication market

The growing internationalization of Chinese telecommunication companies’ business operation beyond the shore of Asian region is reconfiguring the global markets of telecommunication, and information and communication technologies in terms of chain of distribution, competition, and partnership. This is particularly evident in the African telecommunication markets where Huawei is now challenging the European and American multinational companies’ market dominance in telecommunication infrastructures, network expansion, and equipment supply. This article examines the political economy of Huawei’s business strategies and engagement in the Nigerian telecommunication sector, which is the biggest telecommunication market in the West African region.

Transferring codes of conduct within a multinational firm

PurposeThe transfer of organizational practices or management instruments in the multinational firm often requires adaptations to the local context of subsidiaries and is, as such, revealing cultural and institutional particularities. Among the multinational firm’s management instruments, the codes of conduct are closely linked to the values and standards of conduct of the parent company. Being instruments of North American origin, codes of conduct were, in the last 20 years, gradually institutionalized first in North American multinational companies and then more frequently in European multinational companies. Several studies showed the difficulties of implementing these instruments in countries as diverse as France, Germany, Israel and China and stressed the importance of coherence between values, local organizational practices and acceptability of codes by employees of the subsidiaries. The purpose of this paper is to study the specificity of the Lebanese context from a new perspective by showing whether codes of conduct were adapted and by explaining the reasons of these adaptations. This research also highlights the differences between American and European multinational companies regarding the transfer of their codes of conduct.Design/methodology/approachThe study used a multiple case study approach. Interviews were conducted in ten Lebanese subsidiaries of multinational companies, four of North American origin and six of European origin.FindingsThe study showed adaptations done to transferred codes of conduct in Lebanese subsidiaries. The study also reveals differences between American and European MNCs.Originality/valueThe study sheds light on host-country factors explaining the adaptation of codes of conducts transferred to Lebanese subsidiaries.

Is transfer pricing strictness deterring profit shifting within multinationals? Empirical evidence from Europe

This paper examines the extent to which the introduction and tightening of transfer pricing frameworks deter income shifting strategies by European multinational companies. To do so, we have built an index that measures the transfer pricing framework strictness by host country and year. Then, tax rate differentials are used to capture profit-shifting incentives and are interacted with the strictness index to assess whether the host country's transfer pricing framework impacts profit-shifting behaviour. The index is shown to increase significantly over the sample period, indicating that the scrutiny of related party transactions by European governments has increased over the period 2001–2009. Using a sample of European foreign subsidiaries, the results suggest that the stricter the transfer pricing framework the lower the tax rate difference sensitivity of reported earnings. This indicates that tightening the transfer pricing framework is capable of dissuading multinational companies from shifting profits from higher- to lower-tax countries.

A Microeconometric Analysis of the Springboard Subsidiary: The Case of Spanish Firms

Abstract This paper provides a microeconometric analysis of the distinctive characteristics of springboard subsidiaries that have a positive impact on the subsidiaries’ performance. Based on panel data estimations for subsidiaries of European multinational companies with a presence in Spain, the authors found that if the subsidiary is located in the springboard country, then the performance improvement (increase in profit margin) of the subsidiary is about 49 percentage points. When the Spanish subsidiary is considered a springboard subsidiary, its performance is 7.7 percentage points higher than the performance of other subsidiaries that are not springboard subsidiaries. If the subsidiary has a technological relationship with another subsidiary, its performance is 6.7 percentage points higher than the performance of other subsidiaries that do not have a technological relationship. Finally, when the firm has low autonomy, the performance of the subsidiary is 6.2 percentage points lower than that of firms that are independent or have a high level of autonomy.

Voluntary export restraints between Britain and Japan: The case of the UK car market (1971–2002)

The rise in international markets of new, productive Japanese car manufacturers provoked intense world competition, which created serious doubts about the economic sustainability of an industry mostly dominated until the 1970s by European and North-American multinational companies. Ultimately, this crisis provoked a deep transformation of the industry, with consequences that had a permanent impact on European companies in the sector. American and later European manufacturers were successful in lobbying governments to provide protection. Using a rich source of data from the UK, I show that the ‘new trade policy’, voluntary export restraint (VER), placed on Japanese exports of new cars from 1977 to December 1999, was binding. This case study illustrates the strategies used by Japanese manufacturers to gain access to the European market through the UK market via strategic alliances and later through transplant production, against which continental European nation states were unable to fully insulate themselves. It is also shown that the policy had a profound effect on the nature of Japanese products, as Japanese firms responded to the quantity restraints by radically altering the product characteristics of their automobiles and shifting towards larger autos and new goods, to maximise their profits subject to the binding constraint.

The enterprise system revisited: how well does it capture the company’s business network?

Purpose – This paper aims to analyse how well enterprise systems capture the business network in which an industrial company is involved. Enterprise systems have been presented as a “dream come true” with a seamless integration of business data through a common database and software modules that can be customized to the companies’ different functions. However, research shows that companies’ utilization of enterprise systems is limited, and that internal processes are prioritized. Design/methodology/approach – European multinational companies and some of their partners have been followed through case studies between 2003 and 2010. The pattern-matching analysis has been supported by a theoretical framework that depicts industrial companies as engaged in business relationships in a network setting. Findings – The results show that the company’s relationship-oriented activities are badly captured by the enterprise system. The study highlights limitations that future enterprise systems need to address if they are to be able to offer the company a better insight into its business network. Originality/value – The traditionally internal focus on enterprise systems means that important business information transcending inter-organizational activities will be missed. To be worthy of the name enterprise system, more customer- and supplier-oriented activities need to be supported and captured.

Belf Competence as Business Knowledge of Internationally Operating Business Professionals

Business English as a lingua franca (BELF) has come to dominate as the shared code used to “get work done” in international business. In this article, the authors explore internationally operating business professionals’ perceptions of BELF communication and its “success” at work, based on selected data from an online survey (N = 987) and in-depth interviews (N = 27) conducted in European multinational companies. The findings show that BELF can be characterized as a simplified, hybridized, and highly dynamic communication code. BELF competence calls for clarity and accuracy of content (rather than linguistic correctness) and knowledge of business-specific vocabulary and genre conventions (rather than only “general” English). In addition, because BELF interactions take place with nonnative speakers (NNSs) from a variety of cultural backgrounds, the relational orientation is perceived as integral for BELF competence. In sum, BELF competence can be considered an essential component of business knowledge requ...

Trade union cross‐border alliances within MNCs: disentangling union dynamics at the local, national and international levels

ABSTRACTThis study identifies three types of workplace union strategy in the development of cross‐border relations within North American and European multinational companies: defensive isolation, risk reduction and proactive solidarity. Qualitative case studies of MNCs with operations in Canada and Mexico indicate that the nature and intensity of participation in cross‐border trade union alliances are shaped by the union dynamic at the local, national and international levels. A combination of greater workplace union power resources, notably discursive capacity, and of strong supportive approach of the national union, notably dedicated resources and space for bottom‐up initiatives, contributes to proactive solidarity strategies towards international union networks. The absence of these factors is associated with risk reduction and defensive isolation strategies.

Contexto, concepto y dilemas de la responsabilidad social de las empresas transnacionales europeas: una aproximación sociológica

This study addresses the hypothesis that the increasing importance of corporate social responsibility, and its incorporation into European multinational companies, is a true reflection of some of the most important features of present day social, economic and cultural life. The spread of this phenomenon is studied in the context of globalization, makes reference to its multi-scalar, multi-directional and multi-dimensional structure, and also considers its relationship to the increasing importance multinational companies attach to reputation risk management and corporate image. Below we focus on how this is conceptualized by making a distinction between three different types of responsibility and its relation to four dilemmas; should it be obligatory or voluntary, unilateral or multilateral, applied universally or relatively, or just limited to complying with current law. In addition, other philanthropic or social aspects of the company and its consideration as a regulatory plus are addressed. In line with this array of definitions, different outlooks are presented regarding the risks and opportunities of this new social tool.