2024-01-17 00:41:19
Published17. January 2024, 01:41
Davos: Associations denounce the margins of multinationals
The twenty companies with the largest global market capitalizations generated an average margin of 50% between 2018 and 2022.
Apple is one of the companies cited, like Microsoft or LVMH.
Getty Images via AFP
The margins of the twenty biggest companies on the planet have soared over the last five years, four European associations denounced at the Davos forum, calling for an end to monopoly situations.
Between 2018 and 2022, they estimate that the twenty companies with the largest market capitalizations in the world have generated an average margin – which these organizations determine as the difference between the selling price of a good or service and its production cost — by 50%, citing in particular Apple, Microsoft, Saudi Aramco and LVMH.
This is double the average margin achieved by half of the companies analyzed in a large sample of listed groups, notes this report published on the occasion of the World Economic Forum in Davos. The comparison sample used for 2022 included around 34,000 companies. The one from previous years was a different size.
Davos Forum Partners
The margin level of the twenty largest companies has thus increased by almost 7 percentage points in comparison with the period from 1995 to 2022, while that of the enlarged sample has increased on average by a little more than 1 point , specifies the report prepared by four European organizations, the Balanced economy project, Global justice now, the Center for Research on Multinationals (Somo) and Lobby control.
These companies “use their monopoly power in their field to raise their prices and keep them high, defrauding consumers just because they can”, it is written in the report which specifies that 14 of the largest of them are partners of the forum and “are involved in the development of the debates” of this event in Switzerland, where 60 heads of state and government are expected until the end of the week.
Merger control
Before the forum opened on Monday, the NGO Oxfam had already denounced the doubling of the financial assets of the five largest fortunes in the world since 2020, thanks to the surge in stock prices since the pandemic.
Among their recommendations, the four European organizations call for an end to monopolies by notably strengthening the control of mergers and dismantling in several parts the dominant companies “which lock users into their ecosystems”.
They also call for transforming into a public service a company whose dismantling would be too dangerous and for modifying international agreements in order to no longer promote the concentration of companies.
(AFP)
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