Multinational – a company operating in several countries

(Pronounced mul-tee-nah-shuh-nuhl)

Remembering the term multinational is simple if you split the word up as follows:

Multi = multiple or several

National = A nation/country

When applied to a company this means:

Multinational = A company that operates in several nations

A multinational company or corporation, often referred to simply as a multinational, conducts business in two or more countries. The largest companies in the world are multinationals and turn over more money than many countries. These large companies include Amazon, Apple and ExxonMobil. Many fast-food outlets are multinationals, for example, Subway, Starbucks and McDonalds.

Globalisation (businesses operating globally) means that these corporations are having major impacts on the culture of societies. Sometimes this influence can be for the better, such as improving working conditions and practices. Sometimes this can be for the worse, such as making many town centres look exactly the same due to the same outlets appearing in every town.

Multinational companies will have a head office and often that is in the country that it started in. Sometimes the head office will move to another country where the tax on profits is much lower. A company will nominate another country as the head office and charge all the high-tax countries disproportionately more overhead costs such as borrowings from the bank. The head office will be more profitable but will ultimately pay less tax. Many companies move their headquarters to Ireland from other European countries, because instead of the average European corporation tax rate of 24%, Ireland charges just 12.5% tax on profits (as of 2023). This strategy is completely legal and is a commonly used way for multinationals to reduce their tax bill.