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The Issue of the Emergence of Euro Companies - Essay Example

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The paper 'The Issue of the Emergence of Euro Companies' presents Euro Companies that have been well recognized for quite some time however, only in more recent years have they genuinely become a word of the public, as they have never been more notorious or understood then they are today…
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The Issue of the Emergence of Euro Companies
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The Emergence of Euro Companies as Significant Global Economic Entities Over the Past Few Decades: A Critical Review and Analysis Euro Companies have been well recognized for quite some time, however only in more recent years have they truly become a word of the public, as they have never been more notorious or understood then they are today. This is for many different reasons, but the changing and alteration of the world around us is quite obviously an incredibly key factor in this regards. There are many similarities and differences in between Euro Companies and companies in Canada or the United States for example, however in the more recent years Euro Companies have - quite surprisingly - been almost more profitable than companies in North America. This is quite astounding, particularly in regards to the United States, as the U.S. has, for quite some time now, been considered and known as being the most profitable and economically stable nation in the world. The issue of the emergence of Euro Companies as being significant global economic entities over the past few years is one which is of incredible importance and significance, and in order to be able to better understand about this matter overall, there are several factors that need to be thoroughly addressed and discussed. The aim of this paper is to not only discuss the issue of Euro Companies, what they are and their primary purpose, but as well to discuss the fact of how they emerged and became considered as being significant global economic entities, particularly over the past few decades. Therefore, here being discussed will not only be the topic of how Euro Companies have emerged and become significant global economic entities, but as well in regards to how operating across European culture and institutional boundaries may constitute as both a challenge and an opportunity for such organizations, as well as any and all other key and related issues. This is what will be dissertated in the following. In order to understand about Euro Companies in regards to any issue, you need to first recognize and understand about what Euro Companies actually are. Basically, and quite simply, a Euro Company is a company that is located or was begun in Europe or surrounding areas of Europe, and although they certainly do have many similarities to those companies that are in other areas of the world, particularly North America, there are many differences as well, of which are just as important, if not more, to take notice of. There are two constitutional principles in particular which are reflected with Euro Companies, which are subsidiarity and integration in the European Union, which clearly force the system overall to be one of jurisdictional competition. One of the core elements of the structure of European Company law consists of disclosure rules, and these rules are quite clearly dominant in European Company law in general, whether that is speaking in regards to accounting law, the law of capital markets, or in traditional EU Company Law Directives. The structure of Euro Company law is incredibly important to the issue of how these companies in particular have emerged as significant global economic entities however there are many other reasons that need to be taken into consideration as well. One incredibly important and significant issue that needs to be raised here is that of European oil companies in particular, as they have had a great impact on the overall emergence of European companies in general. Especially with the war in Iraq which has been going on for the past few years now, there has been an increasing need for oil, and it has been European companies more than any which have been able to produce this. North America particularly by far has been more in need than any other area in the world, as they have suffered the most from this lack of oil, and thus they have been creating a popularity with the Euro Companies because they have needed to import their oil from here. Global market forces in general, in fact, have truly created a dynamic and even volatile business environment for the oil and gas industry, and thus, as a result, the oil and gas industry has undergone numerous periods of expansion and contraction, of which has certainly not always been associated with the particular price of the commodity. The gradual emergence of the Single European Market is producing incredibly dramatic changes in particular not only to the oil and gas industry, but as well in the shape of the European packaging industry. "Companies which have not already done so are organizing themselves on a pan-European basis. As the retail trade producers of consumer goods in Europe are becoming more concentrated and internationalizing at an increasing pace, so the suppliers of packaging to these industries are following suit" (Datastar, 2007). Mergers and acquisitions in particular have reached an amazing level, especially when compared to where they were only a few years ago, and this has resulted in producing some packaging giants with truly pan-European operations. There are many different examples which can go to prove this, considering that basically all of the European packaging companies have emerged, and for example, "The result in the case of metal packaging is that this sector is now dominated by a handful of companies. In the case of glass packaging, national companies are still very evident in the market for bottles and for food companies, though a process of concentration is underway, but containers for pharmaceutical products and cosmetics are an international market (like their customers). Plastic packaging still remains largely fragmented - the domain of specialist small companies - due to the relatively low cost of entry into this industry" (Datastar, 2007). There are many other issues that must be discussed here, particularly in regards to the matter of corporate governance at the European level; the European Trade Union Confederation (ETUC) as well as its affiliates, strongly push to support the objective of creating a highly productive and prosperous European economy and social Europe as a whole, especially as laid down in the Libson Agenda. "That agenda speaks out in favor of a 'high road' strategy and against a 'low road' strategy for industrial restructuring and wealth creation. However, following the 'high road' of a highly skilled, committed workforce and high productivity requires the acceptance by European companies of the broader notion of social quality, rather than just a narrow approach geared towards serving shareholder interests" (Raaijmakers, 2007). One of the most important issues that need to be recognized and realized here is that of how companies really need to be able to respect and consider both the interests and wishes of their employees, in the interest of being able to hopefully achieve a high level of economic performance. Euro Companies have been able to do this quite well, and this is in fact one of the most primary reasons as to why they have emerged so significantly as being global economic entities. The initiatives of Euro Companies therefore properly endorse the emergence and evolution of a European model of corporate governance, as they foster company boards' orientation towards long-term value creation as well as high-trust labor relations and workers' participation in companies' decision making processes and social responsibilities. "The current trend of global competition pushes companies to constantly expand to new markets and to implement strategies based on the cut of labor costs. Such strategies, however, require huge investments. The structural need to activate the financial leverage implies a pervasive presence of the financial world (banks, investment funds, pension funds and insurance companies) in the companies' risk capital, often with negative effects on the governance functioning and decision-making processes" (Raaijmakers, 2007). In many European countries it is mandatory for the workers' voice to be included in the national system of corporate governance. Indeed, in European companies, employee participation has deep roots and it operates in different ways. In 12 out of 28 EU and EEA Member States (including Norway), workers have a mandatory, legally binding right to be represented in company boards and to influence management decisions in both state-owned and private companies. Co-determination in these countries is a fact, diverse in structure, but deeply-rooted in different cultural and historically developed environments. Worker participation seems to work well in both single and two-tier board environments, making a positive contribution to companies' performance. In other countries participation is the result of bargaining practices and also guarantees an influence on the strategic choices of the company. In any case, all the different participation models allow for different interests in the company to develop in full autonomy. European trade unions have no preference regarding these two models. They merely insist on respecting each of these historically developed structures. There is no evidence of an economic need to change or adapt systems in Europe to copy the US style of company management. On the contrary, an examination of micro and macro indicators indicates better performance by national economies with strong, widespread worker representation at board level, as recent studies conducted by the World Bank, the ILO and ETUI-REHS have shown. From this review we can conclude many different things, namely the fact of how there are numerous different reasons as to why there has been such an emergence of Euro Companies as being global economic entities, particularly in more recent years, and we have seen that one of the most major reasons in particular is in regards to the war in Iraq, and consequently, the lack of oil and gas in locales such as North America and the increase in the oil and gas industry in Europe. When the needs of such enormous nations such as the United States and Canada are lacking, there is thus going to be an obvious emergence of the markets that are located in the areas where the lacking can be filled, in this case, Europe. However this is only one explanation towards the emergence of the markets in Europe, as there is also the issue of packaging companies as well. Packaging companies are one of the largest markets in all of Europe, and because both the United States and Canada - as well as other less industrialized nations as well - are tending to import a large majority of their packaged goods from Europe, thus this is another reason as to why there has been such an emergence of Euro Companies in general. All of the aspects truly must be looked at in order to be able to have a proper understanding on an issue such as this, and, as has been previously discussed, from this we are able to gain a truly more informed and knowledgeable viewpoint on the subject matter at hand. We have been able to see the importance of Euro Companies and of the European market in general, as well as how particularly efficient they have been for the rest of the world in recent years. Although - as with most anything else - there are still certain difficulties and negativities which remain as a basis for most Euro Companies, there are absolutely no problems that are not able to be fixed, and thus, in order for Euro Companies to benefit and profit even more, or at least for them to be able to remain at the high point that they are at now economically, there are really going to have to be some positive reinforcements and decisions that are made soon in order to do this. Works Cited Athwal, Harmit. The Emergence of a European Security-Industrial Complex. 2007. 29 March 2007 < http://www.irr.org.uk/2006/may/ha000016.html> Blum, Jerome, Cameron, Rondo & Barnes, Thomas G. The Emergence of the European World. New York: Little, Brown and Company, Inc., 1970. Coates, Willson H. 'The Emergence of Liberal Humanism: An Intellectual History of Western Europe'. The American Historical Review, 72 (2): 563-564, 1967. Datastar. MOMR - Euromonitor Market Reports. 2007. 29 March 2007 < http://ds.datastarweb.com/ds/products/datastar/sheets/momr.htm> Grundmann, Stefan. 'The Structure of European Company Law: From Crisis to Boom'. European Business Organization Law Review, 5: 601-643, 2004. Kerfoot, Jack L. 'Exploration and Production Trends and the Emergence of the National Oil Companies'. Search and Discovery Articles, 2006. Raaijmakers, Theo. The Statute for a European Company: Its Impact on Board Structures, and Corporate Governance in the European Union. 2007. 29 March 2007 < http://journals.cambridge.org/action/displayAbstract;jsessionid=0B406B961811E28076715E69F03F7C1F.tomcat1fromPage=online&aid=217335> Rosamond, Ben. 'Imaging the European Economy: Competitiveness and the Social Construction of Europe as an Economic Space'. New Political Economy, 7 (2), 2004. Read More
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