How Political Environment Affect Business

Businesses are affected by the political environment in a country because at times they
might suffer a loss. Government actions can result to change in the political
environment at all levels, from the federal level to the local level.
Therefore, businesses must be fully prepared from the fallouts in government politics.
In this article, you will be informed on several factors on how political environment affect
business. Take note that a business is affected by the political environment, either
negatively or positively that will depend on the current situation of a country. Here are
the four factors for you

Impact in the Countrys Economy

The political environment existing in a country primarily affects the economic
environment. As a result, the economic environment also affects the business
organizations performance. Like for example, in the United States, a considerable
number of differences can be seen in Republican and Democratic policies. The two
parties have quite been opposing for years regarding their rules and regulations. This
often has implications for government spending and taxes, which may in turn affect the
stable economy and business of a country. With higher level of spending in the
government body, it may stimulate the economy as well

Change in Government Regulation

Additionally, the change in government regulation is another known factor that affects
business. With the constant change in rules and regulations, this can relatively have an
effect in all businesses. The accounting scandals in the 21st century, for example, has
led the Securities and Exchange Commission in the United States to be more focused
in corporate compliance. The government has introduced the Oxley-Sarbanes
compliance in 2002, as a response on the social environment that calls for public
companies to be more responsible

Political Stability
A lack in political stability may in particular affect the business that operates
internationally. In any country, a hostile takeover may overthrow a government that
could also affect the business. This can lead to looting and rioting as they in turn will
become general disorders of the society

What is Corporate Social Responsibility?

Corporate social responsibility (CSR) refers to business practices involving initiatives

that benefit society. A business's CSR can encompass a wide variety of tactics, from
giving away a portion of a company's proceeds to charity, to implementing "greener"
business operations.
There are a few broad categories of social responsibility that many of today's
businesses are practicing:
1.

Environmental efforts: One primary focus of corporate social responsibility is

the environment. Businesses regardless of size have a large carbon footprint. Any steps
they can take to reduce those footprints are considered both good for the company and
society as a whole.

2.

Philanthropy: Businesses also practice social responsibility by donating to

national and local charities. Businesses have a lot of resources that can benefit charities
and local community programs.

3.

Ethical labor practices: By treating employees fairly and ethically, companies

can also demonstrate their corporate social responsibility. This is especially true of
businesses that operate in international locations with labor laws that differ from those in
the United States.

4.

Volunteering: Attending volunteer events says a lot about a company's sincerity.

By doing good deeds without expecting anything in return, companies are able to
express their concern for specific issues and support for certain organizations.

CONTEMPORARY SOCIAL ISSUES

A contemporary Issue is a Subject that is currently in Public discourse. Most often it is
a Problem that People are discussing about and trying to bounce ideas of them in order
to find a solution
ENVIRONMENTAL ISSUES affecting business include industrial waste, sustainable
development of raw materials and water and air emissions. These issues affect
business because laws require businesses to change equipment and procedures to
meet imposed standards, which costs businesses money.

GLOBAL ISSUES critics suggest that globalization leads to the exploitation of

developing nations workers, destruction of the environment, and increased human right
abuses
TECHNOLOGICAL ISSUES
Information technology is critical to operations for most companies and has the power to
catapult growth when utilized effectively. Conversely, if things aren't going well with IT,
powerful business tools can quickly become frustrating and expensive roadblocks to
achieving business objectives.
ETHICAL BEHAVIOR IN THE ENTERPRISE
Paying attention to ethics makes good business sense. This can create goodwill for the
corporation and enhance the chances of success.
SIX FOUNDATION OF TRUST UPON WHICH ETHICAL BUSINESS PRACTICE IS
BUILT:
CHARACTER - drives what we do when no one is looking.
ETHICS set of rules that describes what is acceptable conduct in society.
INTEGRITY adhering to a moral code in daily decision making.
LAWS is a series of rules and regulations designed to express the needs of the
people.
MORALS a set of rules or mode of conduct on which society is based.
VALUES acts, customs, and institutions that a group of people regard in a favorable
way.