List of Cons of Multinational Corporations
1. They might unfavorably dominate the market.Remember that the market dominance of multinational corporations would make it hard for smaller local companies to thrive and succeed. For example, arguments state that the larger supermarkets can squeeze out local corner stores’ notable margin, leading to lesser diversity.
2. They might exploit the workforce.
These corporations are not well-known for treating people fairly and are instead known for ignoring rules and regulations, as well as turning a blind eye to injustice in the workplace. They are put into the spotlight for outsourcing to the lowest bidders and for skimping on quality. They are not known for having what smaller businesses have—the “human” touch. Many of them are even found exploiting workers and natural resources without considering the economic well- being of any country. In fact, some of them are criticized for using slave labor, where workers are paid with very small wages.
3. They take advantage of consumer expense.
Usually, companies are interested at consumers’ expense, but multinational companies, with more power, is taking this to another level.
4. They can push local firms out of business.
Giant multinationals use the scale of developing economies to push the local firms out of their business.
5. They are willing to gain ridiculous profits at any cost.
These companies are able to realize tremendous profits and do not share their wealth. For example, these organizations that have manufacturing plants in China, where wages are very low, do not increase worker salaries when actually they have very huge amounts of extra revenues.
6. They strive for a monopolized business.
Naturally, many of the largest corporations are monopolizing their industries. They are very powerful, which makes it very difficult, if not impossible, for start-ups and smaller businesses to compete. By monopolizing, they cut out the competition, which eventually stunts economic growth. Plus, authorities might put power in the hands of these global corporations, so they will be able to set the rules.
7. They a great environmental threat.
In the name of profit, multinational corporations commonly contribute to pollution and make use of non-renewable resources, which can pose a threat to the environment. They often abuse the environment and are typically not very careful when using their resources. Moreover, they are well known for leaving an environmental mess in their wake and even have a strong reputation for dumping waste and utilizing natural resources until they are depleted. In general, they are not being very good as keepers of the earth.
