Foreign enterprises in Italy: they are still few but weigh in the production system 

A report provides the first data on the presence and role of foreign multinationals in our country.

Sara Landi | IMT alumna and researcher at Osservatorio Imprese Estere, Luiss
Luciano Lozano/AGF/Ikon Images

The 15,799 foreign-controlled multinational firms in Italy represent just 0.4 percent of our country's resident firms, yet they employ more than 1.5 million people and account for 16.3 percent of the value added produced domestically. Above all, foreign-owned multinationals stand out for their significant propensity to innovate: in 2019 they invested a total of 4.3 billion euros, equal to 26 percent of total private research spending in Italy. These are just some of the most significant data that emerge from the Report "Foreign enterprises in Italy and the new paradigms of competitiveness, produced by the Osservatorio Imprese Estere in collaboration with Istat and with the IMT School, which has just become the Osservatorio's official partner for the promotion of joint research projects.

In fact, the Osservatorio Imprese Estere (OIE) was set up in May 2021, on the initiative of Confindustria's Foreign Investors Technical Group, precisely to collect data on foreign companies in Italy and assess the impact of their presence on the territory, in economic, environmental and social terms. 

Overall, the Report, published last March, shows that due to their characteristics of organisational structure, of governancesize and capital strength, investment in assets intangibles (innovation, R&D, human capital and capacity to drive the territory), foreign multinational companies are particularly responsive to structural changes linked to the ecological transition. Large foreign manufacturing companies in particular are particularly oriented towards adopting actions and behaviours that lead to a high level of environmental sustainability, higher (+7.9 per cent) than other types of companies.

In the current economic scenario, global value chains are the most widespread articulation of the production process: multinationals locate in different places according to the competitive advantages of each country. In the Italian case, foreign companies choose our country to focus on supply chain segments with a high added value content, complementary to the manufacturing sectors that represent the national historical tradition. Small and medium-sized enterprises within the supply chain are thus included in a broader production network. Foreign companies, therefore, are important allies of the small and medium-sized enterprises that characterise the Italian production structure and represent an important asset for the entire country.

The evidence emerging from the report provides a descriptive framework that can contribute constructively to the debate on foreign investment in Italy. Public opinion, in fact, often tends to frown upon foreign takeovers of Italian companies, considering them almost a sell-out of our best industrial tradition, and thus a loss for the entire country. On the contrary, foreign investment and the presence of foreign-capitalized companies in the country are an important support for the growth of the production system and the entire economy, and not only thanks to the inflow of capital. Multinational companies with foreign capital, in fact, by their very nature invest with a longer-term vision, thus favouring the use of financial resources for innovative projects that take longer to achieve results. Moreover, multinationals, especially those with foreign capital, are characterised by a form of governance managerial type, more complex than the traditional model.

Therefore, resources for innovation are combined with modern management processes and relations with the territory favour spillover Therefore, the resources for innovation are combined with modern management processes and relations with the territory favor technological and productivity spillovers, thanks to the dissemination of knowledge, skills and technological innovation. Furthermore, the professional management of the processes that characterizes the multinationals makes it possible to concretely define the organizational practices, the best practices through which the work is divided between the companies and the other players involved and to transmit them within the networks in which they operate. best practicesthrough which work is shared between companies and other actors involved and to transmit them within the networks in which they operate.

The Osservatorio's activity, and the School's involvement in it, is a further building block in the important work of attracting and retention of foreign investors that, especially in this period of instability and uncertainty, can help Italy recover from the post-pandemic crisis we are currently experiencing.

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