Institution-based Weaknesses behind Emerging Multinationals

Undertaking foreign direct investment (FDI) is the defining feature of multinational enterprises (MNEs). While emerging economies as recipients of FDI are familiar with MNEs, these MNEs tend to be firms from the developed world. A new breed of home-grown MNEs has now arisen from the emerging economies, in particular the group known as BRIC (Brazil, Russia, India, and China). In this article, the term “emerging multinationals” is employed to refer to this new group of BRIC-based MNEs. The type of FDI made overseas by this group of emerging multinationals, is defined by a more accurate term, outward foreign direct investment (OFDI), that is now used to differentiate Mike W. Peng [email protected] Professor at Jindal School of Management, University of Texas at Dallas – Richardson – TX, United States