FROM GLOBALISATION TO GEOPOLITICS: HOW ARE MULTINATIONAL COMPANIES REDESIGNING THEIR GLOBAL STRATEGIES

The purpose of this paper is to explore changes in the global strategies of multinational companies in the context of the transition from a world order centred on globalisation to one in which geopolitics is becoming increasingly important. On the basis of a secondary literature review (peer-reviewed journal articles, working papers and industry reports), this study focuses on the move from cost-driven global value chains towards security focused production and sourcing networks. Specifically, the review analyses the process within the context of international business theories: the eclectic paradigm of Dunning, the CAGE distance framework of Ghemawat, and weaponised interdependence of Farrell and Newman, applying the framework to current developments in friend shoring,nearshoring,reshoring,and supply chain diversificationKey to the findings is that geopolitical risks have become primary strategic factors alongside cost and market access, and therefore multinational companies resort to diversification, diplomatic engagement by firms, and other non-market strategies. Furthermore, the results of the study indicate that the highest amount of change takes place in politically sensitive sectors such as semiconductors and rare earth metals.