Multinational Corporation and Its Sustainable Engagement with Local Small Businesses : A Case Study of Unilever Thailand

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Abstract: Once the boundary in global investment does no longer exist, a substantial number of multinational corporations (MNCs) seek for the lower-cost countries such as developing countries or emerging countries to be their production bases. It is undeniable to say that these recipient countries will benefit abundantly in several aspects namely: capital and technical knowledge, employment boost and economic development stimulation. However, the disadvantages that occur may not be worth the trade-off in a long run whether it is economic inflation, impact to the environment and disappearance of small-scale business. Hence, sustainable business approaches concerning every involved stakeholder is vital, some firms might view that adjusting entire activities in the value chain does increase the costs, but some realizes that aligning their practices with along Sustainable Development Goals is the only way to gain profit, and save people and the planet simultaneously.Nevertheless, there are billions of poor people at the Base of the Pyramid (BoP) who are consumers and entrepreneurs especially in the developing countries. Part of the theorizers believes that producing products and service that respond to the grassroots turns out to be new opportunities for MNCs to develop new types of businesses; bring prosperity to the firms; enhance the poor by offering them knowledge and alternative solutions, shaping their aspirations and improving the accessibility of the products. On the other hand, the other part of the theorizers argued that this method does not only harm the poor since these people are vulnerable consumers, it also has less emphasis on legal, regulatory and social mechanisms. In a nutshell, nothing can guarantee that this approach will enventually take us closer to sustainability.In our study, we have seen that there are some MNCs looking at the BoP market with different perspectives. For instance, the arrival of MNCs in term of modern trade business in Thailand caused a severe effect to traditional retail stores or ‘Mom & Pop1 stores’ in the country. Unilever is one of the MNCs that have a major engagement with local small businesses through their new business model which does not only alleviate Mom & Pop store owners to retrieve their businesses, but it also creates a win-win situation between Unilever and these owners concurrently, allowing them to be self-reliance and operate their businesses sustainability in the days to come.The purpose of this master’s thesis is to understand and assess sustainable development theory, particularly in corporate social responsibility thinking in the BoP perspective based on sufficiency economy. Qualitative research and case study of Unilever Thailand were chosen as appropriate research methods to conduct this thesis.

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