Business Environment and Corporate Social Responsibility

Business Environment

Company environment refers to all external factors that influence business activities. The plan, policy, vision, mission, and strategy of the organization are all impacted by changes to any aspect of the business environment. Business environments can be physical or abstract. There are two types of business environments: internal environments and external environments.

• Internal environment:
  • The internal environment of an organization is made up of all the forces that have an impact on how well it runs. The management can exert influence over internal environment forces. Owner, shareholders, the board of directors, resources, organizational structure, and culture make up the internal environment.
• External environment:
  • The term "external environment" refers to all external elements influencing the business environment. Since these factors exist outside the confines of the company, management is powerless to influence them. The elements of the external environment have an immediate, direct impact on managerial choices and have a direct bearing on the success of the firm. Political, economic, sociocultural, and technological factors make up the external environment.

Corporate social responsibilities

Having a sense of corporate social responsibility implies looking out for stakeholders' interests. It entails acting in the interests of stakeholders. Businesses have been founded, are active, and serve a purpose in society. They must conduct their business in accordance with all applicable laws, rules, and social conventions. Stakeholders include shareholders, customers, workers, the general public, and the government.

• Responsibility toward shareholder:
  • Regular dividend from investment
  • Security of the investment
  • Participation in decision-making process
  • Transparency of financial statement

• Responsibility toward consumer:
  • An affordable product with high quality
  • The timely distribution of products
  • Minimize black marketing and fake shortages
  • Offer after-sales support
  • Adaptation and innovation

• Responsibility toward employee:
  • Appropriate salary on time
  • Job security
  • Extra remuneration
  • Training and development
  • Work autonomy

• Responsibility toward society:
  • Use of resources
  • A rise in the standard of living
  • Maintain society's credibility
  • Employment possibility

• Responsibility toward government:
  • Regular tax payment
  • Government's strategy and policy implementation
  • While engaging in foreign trade, uphold reputation
  • Aid in building infrastructure

Managerial ethics

The set of moral guidelines that guide a person's behavior is known as ethics. Managerial ethics refers to the acknowledged standard of societal norms and values, truth, and fairness. Managerial ethics takes into account a variety of elements, including a person's morals, values, personality, and experience. The moral guidelines and precepts used in business are known as managerial ethics.

Corporate governance and Ethical standards:

• A series of interactions between a company's management and various stakeholders is known as corporate governance. A system of monitoring and regulating an organization's activity is known as corporate governance. Corporate governance offers the framework through which an organization's goals are established and the appropriate actions are done to achieve those goals.
• An individual's behavior is governed by a set of moral principles and norms, which are referred to as ethical standards. It serves as a foundation for deciding what is good or wrong in a particular circumstance. There is a connection between managerial behavior and company governance. In order to accomplish an organizational purpose, a manager must uphold moral principles while conducting business.

Reference

Dr.S Poudyal, Santosh Raj. Principles of management. Bhotahity,Kathmandu.: Asmita book Publishers & Distribution (P)Ltd., 2011