Teaching International Financial Management of the Multinational Enterprise in International Business
Education: Exploring the Role of the Parent Firm’s Corporate Treasury and the Use of Internal Debt Financing by
Foreign Subsidiaries
Quyen T.K. Nguyen
Henley Business School, University of Reading, United Kingdom
Volume 20: 2025, pp. 391-432; ABSTRACT
This teaching article, which is intended for international business educators and students
enrolled in undergraduate or pre-experience postgraduate courses, presents three propositions. First,
international financial management of the multinational enterprise (MNE) is important in
international business education. Second, theoretical concepts and frameworks need to be made
relevant to the learning experiences of students by analysing the real-world practices of MNEs and
their foreign subsidiaries. Third, both rigour and relevance must be well-integrated. We apply this
teaching and learning approach by examining the role of internal capital markets within the MNE’s
organizational structure, where the parent firm’s corporate treasury effectively mirrors the working
of internal capital markets in business practice. We introduce a framework for the sources of funds
in the MNE and the foreign subsidiary, discussing its theoretical insights and practical value. We
examine the use of internal debt financing that foreign subsidiaries obtain from the corporate
treasury. To illustrate the link between theory and practice, we use the full accounts of Nestlé (UK)
Ltd., filed with the United Kingdom Companies House, as an example for classroom teaching and
learning.
Keywords: multinational enterprises; foreign subsidiary; corporate treasury; internal debt
financing.
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