The objectives of this study are to determine the effect on certain financial statement relationships of using the equity method to account for subsidiaries in lieu of consolidation and to gather evidence to suggest whether or not bond rating agencies take into consideration these effects in rating corporate bonds. Sixty manufacturing companies listed in COMPUSTAT as having a subsidiary accounted for by the equity method compose the experimental group. The remaining manufacturing companies in COMPUSTAT compose the control group. Computation of eight variables from COMPUSTAT provided data from the companies' original financial statements. Consolidating the subsidiaries of the experimental companies using annual 10-K data made it possible to recompute the same eight variables with these subsidiaries consolidated into the parents' statements. Comparison of the variables for the companies before and after consolidation revealed that five of the eight variables were substantially different and that the differences were statistically significant. Horrigan's multiple regression bond rating model provided indirect evidence to examine which method (equity or consolidation) bond raters use in their rating process. The model is a surrogate for the rating process. Use of the model necessitated calculation of two sets of regression coefficients—one using data in which subsidiaries were accounted for by the equity method and a second when the subsidiaries are consolidated. A derivation sample drawn randomly from both the experimental and control groups provided the data for computation of the coefficients. Comparison of predictions using the two sets of coefficients and validation sample company data revealed that the consolidated method data generated predictions in greater agreement with Moody's bond ratings than did the equity method data. The N-probit technique indicated that the predictions of Horrigan's model are not biased. The research suggests that bond raters find data based on consolidation of subsidiaries more important in their analyses than data based on the equity method. This suggests that the FASB should modify generally accepted accounting principles with regard to the equity method of accounting for unconsolidated, majority-owned subsidiaries.

Multinational corporations face the dilemma of global integration and local responsiveness. Further, they have to contend with trying to minimise agency costs in managing remote subsidiaries. An alternative to regional headquarters was proposed in regional management mandated (RMM) subsidiaries. These subsidiaries are profit and loss units that are delegated headquarters functions to manage peripheral subsidiaries. The study aimed to examine the headquarters-RMM-subsidiary structure through determining whether the RMM-subsidiary was relevant to a multi-business subsidiary with four industry sectors and examining the roles played by the business units within the industry sectors. A qualitative and single-case, exploratory study was conducted, which consisted of twenty-five semi-structured interviews with respondents within the headquarters, the RMM-subsidiary and the peripheral subsidiaries. This research found that the RMM-subsidiary does perform most of the headquarters’ functions for the peripheral subsidiaries and business partners – the performance of which is impacted by the type of business and the channel to market. The performance of these functions further highlighted that each business unit within an industry with the RMM charter plays multiple roles to varying degrees within a given framework and across multiple frameworks, and that the roles are also impacted by type of business and channel to market, local resources and competencies. Peripheral subsidiaries were highlighted as being unimportant, compromising their local responsiveness; however, it was indicated that potentially their role would change as business opportunities dictated. Finally, the deployment of expatriates seems not for purposes of control but to fill resource, knowledge and skill gaps as necessary. This highlighted an alternative to expatriate deployment – the development of staff at the headquarters. This would serve two purposes: equip the individual with knowledge and skills needed in the home country and develop networking and trusting relationships that were found to foster better working ties between the headquarters and subsidiaries. As a result the key components in the HQ-RMM-subsidiary structure are identified as the balance between control and autonomy, RMM-subsidiary roles and networking and trusting relationships, as all three components have a direct bearing on the MNC achieving global integration and local responsiveness. Keywords: headquarters functions, regional management mandated subsidiary, peripheral subsidiary, multi-business multinational corporation, subsidiary roles / Dissertation (MBA)--University of Pretoria, 2014. / zkgibs2015 / Gordon Institute of Business Science (GIBS) / MBA / Unrestricted

“Sustainable development cannot happen without innovation. The challenge before every organization is to develop innovation strategies that not only respond to changes in the environment and societal pressures but also consider the needs and expectations of various stakeholders. The increasing turbulence in the external business environment has focused attention on the resources and organizational capabilities as the principal source of competitive advantage,” (Dasgupta & Gupta 2009, p.204). The intention of this research project is to determine how a business unit of a subsidiary in the professional services industry in an emerging market economy changed strategy from being an implementer (Gupta&Govindarajan, 1991, p.774), of head office strategy to “developing innovation strategies” (Dasgupta&Gupta 2009, p.204); to adapt to a change in the external environment that was caused by a crisis in the global economy.This study will also investigate the impact of having to change strategy, on the capability and development of the business unit of the subsidiary.A project on holding company subsidiary relationships cannot be complete without investigating how a change in strategy of a business unit of the subsidiary affected the relationship between the holding company and the subsidiary.The study looks specifically at a period that was marked by economic turmoil that is the time of the global financial crisis during the years 2008, 2009 and the years after. / Dissertation (MBA)--University of Pretoria, 2012. / Gordon Institute of Business Science (GIBS) / unrestricted

DISC and FSC are two trade policy instruments of the United States that proV'ide a tax incentive for exporting. The two measures provide a stimulus for investment in the export sector by reduci.ng the cost of capital for exporting firms. According to a model based on the neoclassical theory of optimum capital accumulation, the minimum effect either DISC or FSC can have is surprisingly small, reducing the cost of capital by less than percent in either case. The maximum effect is large, reducing the cost of capital in the export sector by around 20 percent. However, the maximum effect of DISC and FSC is accompanied by side-effects that reduce economic efficiency significantly. These results therefore call into question the effectiveness of DISC and FSC as instruments of trade policy. / Master of Arts

Yes / Although social innovation can help multinational enterprise (MNE) subsidiaries create social value for developing countries, they often encounter significant challenges in successfully implementing social innovation projects. This research applies the knowledge-based perspective to propose and test a theoretical framework to explain why MNE subsidiaries differ in their ability to pursue social innovation successfully in a developing country. The framework contends that MNEs’ relationship learning contributes to social innovation variability under varying levels of subsidiary autonomy and mode of entry. Analysis of primary data collected from 207 subsidiaries of MNEs operating in Ghana shows that relationship learning has a positive relationship with social innovation. Further analysis reveals that subsidiary autonomy enhances the positive association between relationship learning and social innovation, and that this moderating effect is stronger for subsidiaries with equity entry mode as opposed to non-equity entry mode. These insights advance the limited understanding of the antecedents of MNEs’ social innovation in developing countries and offer guidance on how MNE subsidiaries can successfully pursue social innovation interventions in a developing country. / The full-text of this article will be released for public view at the end of the twelve month publisher embargo.

Submitted by Odilio Hilario Moreira Júnior (odilio@espm.br) on 2016-11-22T12:39:49Z No. of bitstreams: 1 Matheus Baldo Cordeiro.pdf: 1423668 bytes, checksum: 1d8af65d79d5d90569231d6981b685b1 (MD5) / Approved for entry into archive by Odilio Hilario Moreira Júnior (odilio@espm.br) on 2016-11-22T12:41:35Z (GMT) No. of bitstreams: 1 Matheus Baldo Cordeiro.pdf: 1423668 bytes, checksum: 1d8af65d79d5d90569231d6981b685b1 (MD5) / Approved for entry into archive by Odilio Hilario Moreira Júnior (odilio@espm.br) on 2016-11-22T12:41:58Z (GMT) No. of bitstreams: 1 Matheus Baldo Cordeiro.pdf: 1423668 bytes, checksum: 1d8af65d79d5d90569231d6981b685b1 (MD5) / Made available in DSpace on 2016-11-22T12:45:31Z (GMT). No. of bitstreams: 1 Matheus Baldo Cordeiro.pdf: 1423668 bytes, checksum: 1d8af65d79d5d90569231d6981b685b1 (MD5) Previous issue date: 2016-02-26 / In an increasingly globalized world, firm internationalization has become a major strategy for companies to be competitive in the market. However, firms are facing turbulent times such as economic crisis. The recession effects are extensively studied in the economic field and it proves that these periods are inevitable. Nonetheless, there is a lack of studies in the management field, considering the economic crisis effects, and even more particularly, focusing on the multinational enterprises’ subsidiaries performance during recession times. This study intends to analyze and comprehend which are the relevant aspects for these subsidiaries to achieve a good performance and, therefore, they remain competitive during economic crisis in the market they operate. To investigate the effect, we analyze the case of Japanese subsidiaries located in the European market during pre-crisis and post-crisis, that started in the US and spread all over the world. It was used longitudinal data including the years between 2006 and 2013. A linear regression with panel data and fixed effects had been applied to generate the models used for the analysis. The results show how internal aspects related to accumulated experience, entry mode considering the same nationality of partners and the amount of expatriated staffs, as well as macroeconomic external aspects involving low inflation rate and population income indicators, impacted positively in the Japanese subsidiary performance during crisis periods. The performance is also higher when considering pre-crisis period. / Em um mundo cada vez mais globalizado, a internacionalização de empresas tem se tornando cada vez mais uma importante estratégia para ser competitivo no mercado. Entretanto, as empresas se deparam com períodos de turbulência, como as crises econômicas. Os efeitos de recessões são bastante estudados na área econômica e provam que estes períodos são inevitáveis. Porém, nota-se uma escassez de estudos na área de administração, que considerem o efeito da crise econômica e, mais ainda, no que tange ao desempenho de subsidiárias estrangeiras de empresas multinacionais durante este período recessivo. Este estudo tem o intuito de analisar e compreender quais os aspectos relevantes para que estas subsidiárias obtenham um bom desempenho e assim se mantenham competitivas durante as crises econômicas no mercado em que atuam. Para investigar este efeito, foi analisado o comportamento das subsidiárias estrangeiras de empresas japonesas localizadas no continente europeu nos períodos pré- e pós-crise econômica, que se iniciou nos Estados Unidos em 2008 e se estendeu para todo o mundo. Utilizou-se de dados longitudinais englobando o período de 2006 a 2013. Foi empregada a regressão múltipla com dados em painel com efeitos fixos para a geração dos modelos utilizados para análise. Os resultados mostram que aspectos internos relacionados ao acúmulo da experiência local, modo de entrada utilizando parceiros da mesma nacionalidade e a quantidade de expatriados, como também aspectos externos macroeconômicos como menor taxa de inflação e indicadores de renda da população, impactam positivamente no desempenho da subsidiária estrangeira durante o período da crise. Esta performance também se mostra superior nos anos que antecedem a crise econômica.

In the past several decades research has emphasized innovation development and transfer as key issues when investigating the multinational enterprise (MNE). This thesis focuses on the question of what factors make headquarters involve itself in innovation transfer projects taking place between a sending and a receiving subsidiary within the MNE. This relates to headquarters active participation and role in the organization of resources (structure) and flows (processes) within the MNE. Using a database covering 169 innovation transfer projects the empirical analysis reveals that distances influence headquarters involvement, albeit in different directions. Systematic differences based on subsidiary and innovation characteristics and headquarters involvement is found. Not only subsidiary characteristics are of importance for headquarters involvement, but also the embeddedness of the subsidiary hosting the innovation transfer project. More specifically, physical and cultural distance between the sending and receiving subsidiaries influence headquarters involvement in the transfer negatively, whereas linguistic and economic distance between the subsidiaries conducting the transfer have a positive influence on headquarters involvement in innovation transfer. Looking more closely at the innovations subject to transfer the results suggests that innovations perceived as complex and important are favored for headquarters support. The same is true for innovations that are related to the core business of the subsidiary. At a subsidiary level, powerful subsidiaries initially receive more of headquarters support, but as subsidiary power increase, headquarters becomes less involved, i.e., a curvilinear effect of power is found. Acquired subsidiaries tend to become favored for headquarters involvement in transfer relative to greenfield subsidiaries. Finally, the results indicate that headquarters involves itself in transfer projects when the subsidiaries hosting the transfer projects have been relationally embedded during the innovation development phase. Theoretically, headquarters involvement can be conceptualized as orchestration of innovations within the MNE, and as a form of resource allocation. Thus, this thesis contributes to the understanding of what influences intra-MNE resource allocation, as well as what factors capture the attention of headquarters leading to innovation orchestration. Headquarters involvement in innovation transfer has implications for setting subsidiaries on evolutionary trajectories.

The development of adequate performance evaluation techniques for appraising foreign subsidiaries and their managers in an environment different from their domestic ones has been suggested as an area where management accounting should be extended. This study concerned the performance evaluation of foreign subsidiary managers with the following objectives: (1) to examine the relationships among environmental factors and foreign subsidiary performance, (2) to develop a multinational enterprise (MNE) environmental model to evaluate the performance of subsidiary managers on the basis of controllable factors only, and (3) to test the model in American multinational enterprises for the existence of association among environmental factors and measured performance of foreign subsidiaries. The research method employed in this study was to test for association between noncontrollable environmental factors of a particular foreign country and measured performance of the foreign subsidiary (in terms of ROI) in that particular country. Major noncontrollable factor groups used were economic, political-legal, educational, and social environmental constraints.

No description available.

Thesis (doctoral)--Universiẗat Trier, 2006. / Includes bibliographical references (p. 289-320).