Politically High Risk Environments

A major risk factor for domestic firms operating abroad is the collective uncertainty that exists within the political environment. The risk of impact on safety often is high. Even though high risk factors and potential threats of operating in certain politically charged environments existed, a number of multinational corporations continued to invest deeply and chose to move forward with operational plans in such environments.

• Discuss two reasons why multinational corporations are committed to operating in politically high risk environments abroad.
• Name two multinational corporations which operate in politically high risk environments abroad and discuss whether or not you feel the decision to do so is justified.