Corporate governance and the multinational firm

This article examines the management of MNCs. It takes a critical view of the Anglo-American model of governance, which gives primacy to shareholders over other stakeholders. This, in part, has led to mismanagement of some multinationals. It is argued that the German model is superior because it is better fitted for the global environment of MNCs characterized by multiple legal jurisdictions, information asymmetry and cross-border inefficiencies.