The globally integrated enterprise and its role in global governance

Abstract

Purpose - This paper aims to explore how the model of an enterprise has dramatically changed as a result of globalisation and its subsequent impact on governance. Design/methodology/approach - The paper starts off by explaining how enterprises transformed from the international corporation model of the nineteenth century, to the multinational corporation model of the twentieth century, to the globally integrated model of the twenty-first century. It argues that, although the multinational model helped to build strong relationships with national governments and country-based NGOs, the model has become redundant and uncompetitive in the globalization era. It shares how moving to the new globally integrated enterprise model is inevitable and raises governance implications at the international, national and local level across many dimensions such as culture, skills and ethics. In fact, the new globally integrated enterprise calls for a redefinition of relationships between an enterprise and its stakeholders and with greater collaboration taking place, the role of trust will become an essential foundation for all issues of governance. Findings - The need for global governance to operate beyond national boundaries is being driven by the combination of a growing global interdependence driven by economics and the rise of transnational challenges such as climate change and poverty. Originality/value - The paper is based on IBM's current business model, strategy and corporate citizenship activities and provides an insight into how IBM is evolving its business model in response to globalization. © Emerald Group Publishing Limited.