Business Environment

MBS 2nd year

Unit-1 introduction
Concept and characteristics of
business environment, importance of
business environment, components
of internal and external environment

Unit 2 social responsibility of

business
Concept, strategy and approaches of
social responsibility, corporate
accountability social audit-concept,
feature and model, sustainable
enterprise and consumerism

Unit 3 Nepalese business

environment
Political- legal environment- political system (constitution, political
parties, political institutions, legislative, executive and judiciaries)
government business relationship. Concept of business legislation,
classification of business legislation in Nepal,- general business
legislation, labor related legislation, finance and investment related
legislation
Economic environment: components of economic environment,
economic system, economic policies, structure of economy
( agriculture, industry and service sector) economic reform.
Socio- cultural environment-Components of socio-cultural environment
( demographic, religion, language, education, attitudes and
beliefs),basic social structure ( family, reference groups, social class)
impact of socio-cultural values in business.
Technological environment- concept, level of technology, technology
transfer, status of technology in Nepalese industrial sector, science
and technology policy, information technology in Nepal.

Concept
SR focuses on what an organization
does to society and it does for society.
SR is the businessmans decisions and
actions taken for reasons at least
partially beyond the firms direct
economic or technical interest.
SR refers to pursuit of goals by
business that are in the interest of
society.

Argument for social responsibility

Public expectation
Image buildings
Conducive
environment
Power balance
Resource strength
Less regulation
Economic benefits
Ethical obligations

Goal dilution
Social cost
Poor capacity
Power misuse
Poor accountability
Lack of support

Approaches to SR
1.
2.
3.
4.

Communist
approach
Classical
approach
Reactive
approach
Proactive
approach

1.

2.

3.

4.

Business are born for profit so they never

care society, SR should be imposed. ( karl
Marx)
Business of business is business. SR distort
the market. SR is only compliance of Law
(Adam smith)
Legal compliance alone is not enough.
Business should accept SR beyond the
requirements of the law. It should react to
social pressure to solve social problems
( Keith Davis)
Business and society works for their
mutual benefits.
1.
2.

Proactive level- meet the public expectation

Creative level- create social expectation and play
leadership role

Strategies of SR
Social obligation strategies

Social contribution
It is withdrawal strategy. Under
strategies
this strategy, the social
Businesses regard themselves
responsibility of business is to
as responsible corporate
citizen. They seek opportunity
perform its economic functions
to contribute to society.
efficiently.

Social reaction strategies

It is bargaining strategies.
Under this SR of business is to
react to social pressures.

Social response strategy

To respond voluntarily to social
problem is SR.
Ethical compliance,
philanthropic actions etc

Social accountability
strategies

Business organization are

required to be socially
accountable to their
stakeholder. They reflect
it in their mission and
vision statement. social
audit is used to assess
social performance.