The social and economic context
Chapter 3 considers the social and economic context in which the modern corporation operates. It examines some of the key factors shaping this context and their implications for corporations including: globalisation, political uncertainty and instability, and social media and the 24-hour news cycle. Numerous benefits and challenges of globalisation are discussed. In addition, two recent trends – information globalisation and the proliferation of State-owned or -controlled enterprises – are analysed in light of their current and future implications for multinational corporations. Where once globalisation offered a “flattening of the playing field,” more recently the manipulation of information (for example in the US 2016 presidential election and the UK 2016 Brexit referendum) has occurred in a way which favours the powerful and elites. Likewise, the multiplication of State-owned enterprises in China, and oligarchic models of corporate control in Russia, have transformed the geopolitical landscape and, in some cases, blurred the demarcation between the State and corporate sectors. The chapter then discusses the concurrent surge of far-right political parties (and leaders) around the world and the consequential uncertainty and instability this has generated. Finally, we examine the transformative role of social media and the 24-hour news cycle in reconfiguring the context in which corporations now operate.