Repatriated foreign earnings

 

Choose an international company on which to base your discussion. Find a recent online article about your chosen company that discusses international finance, provides real-world examples, and discusses concepts covered in this unit. Briefly summarize the article, and provide a link.

Reflect on the company, the concepts in the article, and the commonly accepted goal of a multinational corporation to maximize shareholder wealth.

Choose two of the prompts below to address in your discussion.

Do you believe the company is doing a good job of shareholder wealth maximization? Why, or why not?
Does the company you have chosen to study have any additional goals, besides maximizing shareholder wealth?
What theory of international expansion did your company most likely have as a rationale for expanding internationally?
Was the decision to expand internationally likely based on one theory or a combination of theories?
What method of business does your company use to conduct international business? Why?
Is there another alternative form of conducting business that might have worked for your company?
Suggested search terms are listed below:

repatriated foreign earnings,
country risk,
direct foreign investment,
joint venture,
international licensing,
multinational corporation,
finance risk,
balance of trade,
international trade,
outsourcing,
currency effects,
international capital flows,
U.S. exports, and
U.S. imports.

Sample Solution

The company chosen for discussion is Nestle, a Swiss multinational food and beverage company. The article used as reference is entitled “Nestlé: A Comprehensive Financial Analysis of a Multinational Corporation” (https://www.investopedia.com/articles/markets-economy/111514/nestle-comprehensive-financial-analysis-multinational.asp). This article covers international finance topics such as accounting policies, profitability metrics, liquidity ratios, dividend policy and capital structure analysis in order to assess how well the company has been doing financially.

Nestle has had good financial performance in recent years with sales reaching $92 billion in 2017 and net profit rising by 5% due to cost reduction initiatives and successful pricing strategies implemented by the management team. Liquidity ratios indicate that the company is able to meet its current obligations without difficulty through adequate cash reserves and access to external sources of funding when needed. In addition, Nestlé’s dividend policy has remained unchanged over the years which may suggest that it could have potential for increasing dividends or share buybacks if appropriate opportunities arise in future periods.

The main goal of any multinational corporation is to maximize shareholder wealth by maximizing profits while maintaining acceptable levels of risk within an ethical framework of operations, which appears to be what Nestle aims at achieving despite having several additional long-term goals like focusing on innovation in order to remain competitive globally, promoting sustainability of their production processes among others (Kumar et al., 2019). Looking into Nestle’s financial performance over the past few years indicates that they are doing a good job at balancing short term gains with long term planning towards creating sustainable value for their shareholders -for example investing heavily in research & development rather than relying on quick fixes from acquisitions or cutting costs significantly just to boost quarterly earnings-. As such I believe they are indeed doing a good job at shareholder wealth maximization overall although there might be some areas where improvement can still be made going forward given changing consumer demands worldwide related markets dynamics changing quickly increasingly often these days.

ittola expresses the extent of military tactics used, but never reaches a conclusion whether it’s lawful or not to proceed these actions, as he constantly found a middle ground, where it can be lawful to do such things but never always (Begby et al (2006b), Page 326-31). This is supported by Frowe, who measures the legitimate tactics according to proportionality and military necessity. It depends on the magnitude of how much damage done to one another, in order to judge the actions after a war. For example, one cannot simply nuke the terrorist groups throughout the middle-east, because it is not only proportional, it will damage the whole population, an unintended consequence. More importantly, the soldiers must have the right intention in what they are going to achieve, sacrificing the costs to their actions. For example: if soldiers want to execute all prisoners of war, they must do it for the right intention and for a just cause, proportional to the harm done to them. This is supported by Vittola: ‘not always lawful to execute all combatants…we must take account… scale of the injury inflicted by the enemy.’ This is further supported by Frowe approach, which is a lot more moral than Vittola’s view but implies the same agendas: ‘can’t be punished simply for fighting.’ This means one cannot simply punish another because they have been a combatant. They must be treated as humanely as possible. However, the situation is escalated if killing them can lead to peace and security, within the interests of all parties.
Overall, jus in bello suggests in wars, harm can only be used against combatants, never against the innocent. But in the end, the aim is to establish peace and security within the commonwealth. As Vittola’s conclusion: ‘the pursuit of justice for which he fights and the defence of his homeland’ is what nations should be fighting for in wars (Begby et al (2006b), Page 332). Thus, although today’s world has developed, we can see not much different from the modernist accounts on warfare and the traditionists, giving another section of the theory of the just war. Nevertheless, we can still conclude that there cannot be one definitive theory of the just war theory because of its normativity.

Jus post bellum

Finally, jus post bellum suggests that the actions we should take after a war (Frowe (2010), Page 208).
Firstly, Vittola argues after a war, it is the responsibility of the leader to judge what to do with the enemy (Begby et al (2006b), Page 332).. Again, proportionality is emphasised. For example, the Versailles treaty imposed after the First World War is questionably too harsh, as it was not all Germany’s fault for the war. This is supported by Frowe, who expresses two views in jus post bellum: Minimalism and Maximalism, which are very differing views. Minimalists suggest a more lenient approach while maximalist, supporting the above example, provides a harsher approach, punishing the enemy both economically and politically (Frowe (2010), Page 208). At the last instance, however, the aim of war is to establish peace security, so whatever needs to be don

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