1. Introduction

‘principled embeddedness’ stands for the corporate commitment of an MNE to follow its self-imposed corporate responsibility principles worldwide, while, simultaneously, providing its subsidiaries with sufficient autonomy to embed themselves into the local economy (see Aerni 2017b). In this sense, the term ‘principled’ ensures that embeddedness is not indirectly endorsing the undesirable type of embeddedness associated with local corruption and collusion (an anti-corruption policy should be part of the CSR principles of a company).

There are certainly global companies that do indeed only care about profits no matter at what social cost. Moreover, the so-called ‘paradise papers’, published on November 5, 2017 by the International Consortium of Investigative Journalists (ICIJ) have once again unveiled tax evasion practices by MNEs, especially in the mining sector, that may not be illegal but nevertheless account for a significant loss of government revenues in countries where the resources are extracted. Abusive tax practices by MNEs will be addressed briefly in Sect. 7.​4.​4. In view of the ease to hack data in the age of the digital society and the enormous long-term costs resulting from reputation loss associated with the detection and denouncing of extensive transfer pricing, MNEs may think twice if it is worth to endanger their license to operate by taking the risk of making extensive use of tax havens to optimize tax payments. Some MNEs may continue to engage in tax evasion even if they cannot claim that national corporate taxation schemes would be abusive. But it would be unfair to argue that they represent MNEs in general.

See http://​www.​ohchr.​org/​EN/​Issues/​Business/​Pages/​BusinessIndex.​aspx (Accessed Sept 25 2018).