The U.S. Department of Commerce offers the most clear-cut definition of MNCs as "firms with direct investment outside the countries in which their headquarters are located." 1 For statistical purposes the Department considers direct investment to be ownership relationships between a company and an affiliate in another country in which the parent company has a 10% ownership.
The United Nations' Economic and Social Council, on the other hand, arrived at a more detailed quantitative definition of an MNC:
In the broadest sense, any corporation with one or more foreign branches or affiliates engaged in any of the activities mentioned [assets, sales, production, employment, or profits of foreign branches and affiliates] may qualify as multinational. More strictly, a particular type of activity (e.g., production), a minimum number of foreign affiliates (e.g., six), or a minimum foreign share of activity (e.g., 25 percent of sales or assets) may be added as conditions for qualifying for the definition. 2
- 1649 reads
