Diffusion of Environmentally Friendly Technologies by Multinational Corporations in Developing Countries?

DANIEL CHUDNOVSKY,; ANDRÉS LÓPEZ

International Journal of Technology Management & Sustainable Development

Intellect

Año: 2003

Multinational corporations (MNCs) can be an important source of environmentallyfriendly technologies for developing countries since their affiliates are often more advancedthan local firms in the adoption of modern environmental technologies and managementpractices. This does not mean, however, that MNC affiliates in developing countriesinvariably employ the same standards, technologies and management approaches adoptedby their parent companies or by affiliates operating in developed countries. The contributionof MNC affiliates to sustainable development depends on the quality of their operationand the characteristics of the host countries where they operate. The former isconditioned by such factors as the nature of the sectors where MNCs direct their investments,the kind of assets brought by MNCs, and the role played by the affiliates withinthe MNC global network. The latter is mainly about the availability of skills, the stateof domestic technological infrastructure, the competitiveness of local suppliers, the nature ofnational environmental regulations and the extent to which these regulations areenforced. The paper notes the need for more robust empirical studies on the environmentalrole of MNCs to guide policy aimed at enhancing the effectiveness of foreign directinvestment (FDI) initiatives in promoting sustainable development.