1 Portfolio Unit 5 BUS 5115: Business Law, Ethics, and Social Responsibility Soukaina Qmih University of the People Dr. Todd Cooley March 3, 2022 Law may be defined as a system of laws established by each nation or state to coordinate, regulate interaction, and maintain society's safety and harmony. Enforcement is often carried out by various institutions such as police and courts; the law empowers them to penalize anybody who violates the standards. According to Cambridge University Press (n.d.), the law can be defined as “a rule, usually made by a government, that states how people may and may not behave in a society, and often orders particular punishments if they do not obey”. The first role of the law is to serve as a safeguard. It protects against all kinds of evil. Secondly, it has the function of putting forward the needs of the community. It can also settle disputes, but above all, it encourages the use of legal applications. Business law encompasses all the laws that govern the formation and operation of a business. This comprises all the rules that control and regulate how to start, buy, run, manage, 2 close, or sell any kind of company (Schaffer, 2016). Business laws established the concepts and standards that all businesses must follow. Any business is usually created and run for profit. People constantly need a visual framework to act, progress and function. The purpose of business laws is to provide a proposition to all those who wish to start a business. To avoid a chaotic marketplace, a set of rules and actions must be established to manage individuals. For example, business law plays an essential role in protecting the rights of a company's shareholders and managing conflicts between them that may be detrimental to the development of the company. Contracts with employees or suppliers are another example of how the law helps safeguard a business and ensure its success. Not to mention how it protects against theft of intellectual property, such as trademarks and innovations, through patents, unfair competition. Moreover, “There is ample evidence that the establishment of the rule of law attracts private investment, to the extent that it creates a climate of stability and predictability, where business risks may be rationally assessed, property rights protected, and contractual obligations honored” (Shihata, 1996, p. 1578). Simply establishing these principles provides much-needed consistency, clarity, and stability in an otherwise turbulent environment that could hinder a company's development. Originally, laws were established to protect the people and society against unethical actions. Corporate law plays a vital role in safeguarding society from harmful business activities; nevertheless, the principles differ greatly from place to region. Because ethics is a subjective topic that varies from person to person, the need of law enforcement organizations in avoiding and protecting the people is clear. 3 Because the global business activity is so diverse, many types of safeguards and laws were required. Consumer protection legislation is an example of a weapon used by law enforcement agencies to prohibit deceptive or unfair actions. Providing guarantees on products is also one of the tools consumers may use to protect themselves from being tricked and dumped with low-quality or damaged goods (Nebbia, 2012). Furthermore, criminalizing and prohibiting misleading advertising and pricing is also a kind of client protection to keep them from being a victim of unethical company activities. The rule of law is required to counteract the negative consequences of uncontrolled commerce and business on the planet and its health, environmental destruction, and labor exploitation. Guiding laws and rules also give clear standards, credit approval criteria, and anticipated ethical conduct to the private sector. Regulatory authorities, such as the Environmental Protection Agency (EPA), regulate waste disposal, greenhouse emission reduction, and pollution management to maintain ethical sustainable practices (Davis, 2021). In terms of legal corporate social responsibility (CSR), there is a clear relationship between company activity and law, implying that businesses must adhere to laws and regulations. Corporations must be completely informed of the legal system. Most crucially, lawful CSR requires corporations to neither breach the law nor engage in criminal activities for their selfish gain. In terms of environmental CSR, corporations should be aware of their responsibility to conserve and develop the environment, which plays an important role in society's benefit. Several minor but significant tasks may be undertaken, such as minimizing toxic materials in manufacturing and services, creating green workplaces, conserving water and energy, and limiting waste. 4 In enacting laws to protect businesses and customers, lawmakers should strike a delicate balance between protecting businesses' and customers' rights in terms of ease of doing business, tax rates, VAT rates, and government intervention in the pursuit of sustainable growth, reduced inflation, and economic prosperity. Finally, the rule of law offers a guiding framework for how individuals, corporations, and governments conduct and function in concerns such as insider trading, environmental sustainability practices, credit approval, local and international commerce, exporting and importing, and regulating. To conclude, Corporate-related legislation will aid in economic growth and serve as a protection for business operations. It provides a good orientation for the firm and guides them to take ethical actions in all commercial operations. It deters businesses from engaging in illicit operations and holds them responsible for their conduct. It offers an open mechanism for tracking and tracing their commercial activity and financial transactions. Both businesses and persons involved are controlled by a different set of laws under the concerned authorities which has the potential of anticipating and allowing for flexibility in contractual terms, regarding support business demands. As a result, law contributes to the development of a good marketplace for merchants and consumers. It gives a set of guidelines for dealing with the dispute resolution aspect. This aids in suing organizations for illegal practices that are harmful to society or the environment. Law also protects private and personal property infringement and aids in the documentation of transactions and intellectual property rights. “the link between the rule of law and economic growth derives from the micro-level incentives created by the conditions sustained by the rule of law” (Zywicki, 2002, p. 22). References 5 Cambridge University Press. (n.d.). Law. In Cambridge Dictionary. https://dictionary.cambridge.org/us/dictionary/english/law Nebbia, P. (2012). Competition law and consumer protection against unfair commercial practices: a more-than-complementary relationship?. In The Global Limits of Competition Law. Stanford University Press. https://doi.org/10.11126/stanford/9780804774901.003.0010 Schaffer, J. (2016, December). It is the Business of Laws to Govern. Dialectica, 70(4), 577588. https://doi.org/10.1111/1746-8361.12165 Shihata, I. F. (1996). The role of law in business development. Fordham Int'l LJ, 20(5), 15771588. Zywicki, T. J. (2003). The rule of law, freedom, and prosperity. Supreme Court Economic Review, 10, 1-26. https://doi.org/10.1086/scer.10.1147136
