Abstract:
This report considers emerging market multinational enterprise (MNE) maturity paths, with particular reference to firms with a South African origin and the choice of location for the corporate headquarters. A generalised model describing the internationalisation of globalised Emerging Market multinational enterprises is developed, describing three possible trajectories. That is, headquarter relocation, acquisition by another MNE or remaining independent in the country of origin. It is argued that Emerging Markets have offered less location advantage than Developed Markets to multinational enterprise headquarters. Using factor data for 46 nations, significant evidence is found to support this argument. Further, two arguments are built on this conjecture: that Emerging Market multinational enterprises have relocated headquarters to Developed Markets, not to other Emerging Markets, and that firm behaviour was predicted by concentration of private shareholding, levels of state ownership and levels of foreign business interest. Using a firm level sample of 61 South African companies, some evidence was found to support these arguments in this specific context. The implications of the results are considered for policy makers as well as managers, and recommendations for further research are made. Copyright
