Which is a disadvantage of multinational companies?

Multinational companies (MNCs) often operate across multiple countries, which introduces a variety of languages and communication styles into their operations. This diversity can lead to significant difficulties due to language barriers. For instance, when employees from different linguistic backgrounds attempt to collaborate, misunderstandings can arise, which may impede effective communication and decision-making. Additionally, conveying company policies, training, and corporate culture can become more complex in multilingual contexts.

While successful MNCs typically develop strategies to mitigate these challenges—such as employing translators or adopting a common corporate language—language barriers remain a notable disadvantage.

The other options highlight advantages or characteristics that don’t align with the typical challenges faced by MNCs. For example, higher communication efficiency could be an advantage when overcome language barriers, and operating in one culture or having less exposure to foreign markets do not accurately describe the nature of a multinational entity, as they deliberately engage across multiple cultures and markets to maximize their reach and profitability.