What role do political institutions play in business activity?
Political institutions enforce laws and regulations that businesses need to adhere to.
What must MNCs do when establishing in a new country?
They must work within the institutional framework of that country.
How can MNCs in developed countries influence governments?
They can exert pressure through lobbying to create favourable business conditions.
What issue can arise when politicians join MNC boards after retiring?
They may reduce political control over the MNC while in power in return for future roles.
How can MNCs influence governments in developing countries?
By establishing deals that benefit politicians.
How may bribes be used by MNCs?
To secure lucrative contracts.
What is meant by legal control over MNCs?
Governments enforcing legislation and regulations to control their operations.
What organisation within the EU helps regulate competition?
The Competition Commission.
What is the role of the EU Competition Commission?
To protect producers and consumers from anti-competitive or unfair practices.
Give an example of legal action taken against an MNC by the EU.
Google was fined 2.24bn euros for abusing its market dominance in the search engine market.
Why do governments want to attract MNCs?
To help boost their economy.
How do governments create stability for MNCs?
By enforcing legal controls in areas such as taxes and employment.
Why was the UK attractive to MNCs before Brexit?
It offered economic stability and access to the EU marketplace.
What are pressure groups?
Organisations that influence company and public policy in the interest of a particular cause.
At what levels can pressure groups operate?
National or international.
Give an example of a pressure group campaign involving Lego.
Save the Arctic campaigned for Lego not to sell its products at Shell petrol stations.
What did Greenpeace campaign for regarding Kimberly-Clark?
For the company to dispose of its products in a sustainable way.
What methods can pressure groups use to influence businesses?
Naming and shaming
What is meant by direct action by pressure groups?
Protests
What is lobbying in the context of pressure groups?
Taking issues directly to the government.
Give an example of a pressure group that supports businesses.
The Confederation of British Industry (CBI).
What does the Confederation of British Industry do?
It speaks and lobbies the government on behalf of member businesses.
What is meant by social media in a business context?
Interaction of people via electronic devices using social media platforms.
How can MNCs use social media to their advantage?
To spread awareness and promote their business globally.
