Introduction: Transnational Corporations Revisited

Transnational corporations are not a new phenomenon.¹ The extension of economic activities across national borders since the end of World War II caused transnational corporations to spread to an extent capable of significantly affecting societal matters. This development did not go unnoticed in academic discussions. Transnational corporations have been of major scientific interest since the 1960s. Stephen Hymer, an early pioneer in this area, analyzed the organizational mechanisms of multinational corporations.² The exploding number and size of private enterprises on a global scale mesmerized many authors, who called such enterprises "cosmocorps"³ and "a challenge to the nation-state."⁴ In the early 1970s, authors like Raymond Vernon in his book, Sovereignty at Bay: The Multinational Spread of U.S. Enterprises,⁵ and Samuel P. Huntington in his seminal article, "Transnational Organizations in World Politics,"⁶ were at the forefront of questioning the fundamental relationship between nation-states and transnational organizations. By the early 1990s, the importance of transnational corporations vis-à-vis nation-states as influential actors on the international level had already been clearly stated.⁷

So why revisit a subject already discussed in the 1970s today? Because the world has seen enormous change over the last few decades, which has affected the role of transnational corporations in what is now perceived as a globalized society. While Huntington claimed in the early 1970s that transnationalism—as opposed to European colonialism—is the "American mode of expansion,"⁸ and many economists thought that transnational corporations were in fact national corporations with international business activities,⁹ others predicted that in the future there would be no national products, technologies, corporations, or industries, but only global economics.¹⁰ In 1990, for instance, Kenichi Ohmae stated: "In today's 'Interlinked Economy,' global corporations have effectively become nationalityless."¹¹ In fact, in 2011 we witness not only an era with more, bigger, and increasingly influential transnational corporations than any time before (see section II), but also an era when these corporations' de facto independency from a certain nation-state as their home base is growing (see section III).

A further examination is also needed because the analysis of transnational corporations from a specifically legal perspective remains underdeveloped. Whereas numerous economic contributions treat the inner structure of transnational corporations,¹² law scholars largely focus on the external relationships of the corporation and regulatory issues like supervision, taxation, or liability.¹³ It is remarkable that even the most important economic standard literature on transnational corporations is hardly taken into account in the legal discourse. Alan Rugman, author of the seminal book, Inside the Multinationals: The Economics of Internal Markets, notes that since its publication in 1981 the book has been cited 215 times in academic scholarship—but only three times in legal contributions.¹⁴

In legal discourse, the corporation was originally treated as an object regulated by nation-states; its inner functioning remained out of focus. More recent legal publications have differentiated the role of the corporation in more detail. Particularly, the literature on corporate social responsibility (CSR) has boomed over the last decades.¹⁵ This debate was accompanied by literature on the treatment of transnational corporations under international law¹⁶ and the role of corporations as legislators of their own legal regimes.¹⁷ However, these branches of research treat only follow-up problems; further research is needed in order to better understand the inner functioning of the transnational corporation. The merits of specific legal discourses, like the CSR debate, could be expounded if legal scholars were better able to understand the corporation itself as the starting point of concerns about its responsibility. From this perspective, the recent debate over transnational corporate governance points in the right direction.¹⁸

In order to set the stage for the discussion in the following contributions, the remainder of this introduction briefly addresses three issues. First, what is a transnational corporation? Second, how important are transnational corporations for world trade? And third, how transnational are transnational corporations? This introduction then concludes with a brief overview of the contributions in this issue.

I. The Concept of Transnational Corporations

From a legal perspective...