A multinational corporation (MNC) operates in at least one country other than its home country, while a transnational corporation (TNC) is any enterprise that owns assets and operations in multiple countries. MNCs are usually large corporations controlled by a parent company, while TNCs have independent subsidiaries in foreign countries. Both MNCs and TNCs can positively impact economies through foreign investment, job creation, and technology transfer, but may also face criticisms like environmental damage, exploitation of workers, and economic leakage.

1. Sub:- Business Environment CE-2
M.Com (E-commerce)
By Group 2,
21002 Samrat Choudhary
21007 Sanika Sakre
21012 Shrihari Rajgopal
21017 Kinjal Shinde
21022 Saurabh Maurya
21032 Akshit Rameshia
Topic :- MNC & TNC

2. Introduction to MNC’ S
A Multinational Company (MNC) is a corporate organization that
owns or controls the production of goods or services in at least one
country other than its home country. Black's Law Dictionary suggests
that a company or group should be considered a multinational
corporation if it derives 25% or more of its revenue from out-of-home-
country operations. However, a firm that owns and controls 51% of a
foreign subsidiary also controls the production of goods or services in at
least one country other than its home country and therefore would also
meet the criterion, even if that foreign affiliate generates only a few
percent of its revenue. A multinational corporation can also be referred to
as a multinational enterprise (MNE), a transnational enterprise
(TNE), a transnational corporation (TNC), an international
corporation, or a stateless corporation. There are subtle but real
differences between these terms.

3. Introduction to MNC’ S
A multinational corporation (MNC) is usually a large corporation incorporated in one
country which produces or sells goods or services in various countries. Two common
characteristics shared by MNCs are their large size and the fact that their worldwide
activities are centrally controlled by the parent companies.
● Importing and exporting goods and services
● Making significant investments in a foreign country
● Buying and selling licenses in foreign markets
● Engaging in contract manufacturing — permitting a local manufacturer in a
foreign country to produce its products
● Opening manufacturing facilities or assembly operations in foreign countries
List of Multinational Companies in India
● Microsoft.
● Apple.
● LTI.
● Deloitte.
● Coca Cola.
● TCS.
● Accenture.
● IBM.

4. Strength & Weakness of MNC’ S
STRENGTHS:-
 Assure quality standards.
 Modern technology.
 Research and Development.
 Growth of industry.
 Better utilization of resources.
 Expand local industries.

5. Strength & Weakness of MNC’ S
WEAKNESS:-
 Environmental Damage
 Increases competition
 Pressurize Governments
 Uncertainty in jobs
 Reduces Tax Liability

6. Introduction to TNC’ S
A transnational corporation (TNC) is any enterprise that
undertakes foreign direct investment, owns or controls income-
gathering assets in more than one country, produces goods or
services outside its country of origin, or engages in international
production.
TNCs’ are formal business organizations that have spatially
dispersed operations in at least two countries.
One of the most "transnational" major TNCs is Nestlé, the Swiss
food giant; 91 percent of its total assets, 98 percent of its
sales, and 97 percent of its workforce are foreign-based.

7. Strength & Weakness of TNC’ S
STRENGTHS:-
 Economic Impact
 Increase Employment Rate
 Technology Contribution
 Enhancement of Export
 Generation Revenue to Developing Countries
 Generation of Government Revenue
 Infrastructure Development
 Environment Impact

8. Strength & Weakness of TNC’ S
WEAKNESS:-
 Labour Exploitation
 Removal of Capital
 Economic Recession
 Outflow of Wealth
 Outside Decision Making
 Widening Gap Between Developed And Developing Countries

9. Distinguish Between MNC & TNC With Examples
BASIS MNC TNC
MEANING
MNC refers to multinational corporations (MNC)
is usually a large corporation operated in home
country which produces or sells goods or services
in other countries
TNC refers to TRANSNATIONAL
CORPORATIONS (TNC) which operated in
foreign countries individually , not through home
country.
REGISTERED OR INCORPORATED
MNC only registers in home country not in other
countries.
TNC also registers in other countries so they
treated as different from MNC
OPERATIONS
They do not have subsidiaries in other country or
It has branches in other country .
They have subsidiaries in other country.
DECISION-MAKING
Decision making in MNC made in home country
and should affected to all other countries.
Decision making in TNC is made by company
manger in individuals host countries .
LOCAL MARKETS
MNC face restrictions when it comes to local
market since they have centralized management
system.
TNC are free to make decisions independently
based on local markets.
CENTRALIZED SYSTEM
It has centralized system where global
management is coordinated.
TNC do not have centralized system.
COMPANIES EXAMPLE Microsoft, FedEx, Kimberly Clark, Walmart. Toyota Motor Corporation , Vodafone India

10. Foreign Collaboration & Indian Business
 In India, foreign collaboration agreements are being
made between Indian and foreign companies through
its sale of technology, spare parts and use of foreign
brand names for its final products.
 Foreign Collaborations have some favorable impacts
on Indian economy. Initially, Indian industries were
concentrated on consumer goods sector only.

11.  Considering the harmful effects of MNCs too like
interference, faulty transfers, etc. on a developing country
like India, various government agencies have been
entrusted with the responsibility of controlling the activities
of Multinational Corporations in the country.
 Lack of capital is a serious handicap in the way of
economic development of underdeveloped countries
 India possesses abundant natural resources but due to
lack of technological knowhow and capital, the natural
resources cannot be properly exploited.

12. Types of Foreign Collaboration
The four main types of foreign collaboration are depicted below.
Now let's proceed further to discuss each type of foreign
collaboration.

13. Financial collaboration is a summation of domestic and foreign
investment.
In this method, the foreign company lends finance by:
1. Purchasing ownership shares.
2. Giving long-term loans.
3. Giving credit facility.
1. Financial Collaboration

14. Technical collaboration helps to remove an existing technological
gap.
Therefore, the governments of developing countries encourage
such collaborations.
In developing countries, most of the foreign collaborations are
technical in nature.
2. Technical Collaboration

15. In marketing collaboration integration of domestic and
foreign market takes place.
In marketing collaboration, foreign company agrees to sell goods
produced by the domestic company.
3. Marketing Collaboration

16. In management consultancy collaboration integration of
domestic and foreign consultancy takes place.
In management consultancy collaboration, foreign company
provides management skills to the domestic company and
teaches it everything about management.
4. Management Consultancy Collaboration.

17. Impact of MNC & TNC on Indian Business
(MNCs) While multinational companies played a significant role in the
promotion of growth and trade in most South-East Asian countries
they did not play as much of a role in the Indian economy where
import-substitution development strategy was followed. Since 1991
with the adoption of the industrial policy of liberalization has been
recognized as important for rapid growth of the Indian economy.
(TNCs) Many transnational corporations have set up factories
and offices in India. The country is an attractive location to TNCs
because the population speaks good English, has strong IT skills
and works for lower wages than people in many other countries.
Companies like Toyota, Volvo and Hyundai manufacture cars in
India. Companies like ASDA, BT and Virgin Media have call
centers in India.
Source: https://prezi.com/x_edffzbjp-t/the-impact-of-mncs-on-india

18. Positive Impact :
The Promotions of Foreign
Investment
Non-Debt Creating Capital
Inflows
Technology Transfer
Promotion of Exports
Investment in Infrastructure
Growing Middle Class
Stimulation of Domestic
Production
Negative Impact :
Harmful to producers and consumers:
Their aim is global profit. The study of
US companies showed that : Prices for the
consumer is raised. Income of producer
is lowered. Quality is made inferior.
Evil of Transfer Pricing
Currency Manipulation
Bad Business Ethics
MNCs brought bad products to India
MNCs can drive local business out of the
market
Impact of MNC on Indian business

19. Impact of TNC on Indian Business
Positive Impact of TNCs in India
TNCs have created jobs and offered education and training to employees
The additional wealth has led to the multiplier effect.
Some TNCs have set up schemes to provide new facilities for local communities.
The infrastructure of the country has been improved, with new roads and internet
cabling.
TNCs pay tax to the government, which can be spent on development projects.
Negative Impact of TNCs in India
Some corporation leaders have taken advantage of the relaxed environmental laws
in the country by creating lots of pollution.
The conditions for workers in factories can be very harsh.
Many TNCs are owned by foreign countries so economic leakage occurs, where
profit is sent abroad.
The best jobs are often given to foreign workers from the TNC's country of origin.
TNCs use many of the country's natural resources - a soft drink bottling plant in
Kerala, India, was shut down due to its impact on local water supplies.
Source: https://www.bbc.com/

20. CONCLUSION
MNCs need to evaluate social responsibility, employee
devilment, competitors, and customers in accordance with
business ethics. The companies can operate well if they
follow cultural practices in countries where they operate. In
addition, they should consider the regulations and ethical
framework in countries where they operate.
TNCs have offered a number of efficient to both host
countries and home countries particularly in host countries.
They produce the development of employment rate and job
opportunity to the host countries and also technology and
knowledge transfer.

21. THANK YOU!