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A Note on Return on Foreign Assets and Foreign Presence for UK Multinationals *
Author(s) -
Rugman Alan,
Yip George,
Jayaratne Saliya
Publication year - 2008
Publication title -
british journal of management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.407
H-Index - 108
eISSN - 1467-8551
pISSN - 1045-3172
DOI - 10.1111/j.1467-8551.2007.00536.x
Subject(s) - multinational corporation , context (archaeology) , business , metric (unit) , space (punctuation) , return on assets , work (physics) , industrial organization , marketing , computer science , finance , geography , mechanical engineering , archaeology , profitability index , engineering , operating system
Within the context of the international business literature on multinationality and performance we develop new data on the foreign presence and performance of large UK multinational enterprises (MNEs). There are 32 UK MNEs for which we can obtain data on both their degree of multinationality (measured by the ratio of foreign to total (F/T) sales) and their performance. Here, in addition to the traditional overall performance of the firm, shown as return on total assets, we use new data on the return on foreign assets (ROFA). We conduct analytical work to show the positioning of the UK MNEs in the ROFA and F/T sales space and provide regression results showing a linear relationship between multinationality and performance, using the new ROFA metric.