Chapter_10_Regulating_Business_2

Chapter_10_Regulating_Business_2 - BUS306002...

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BUS 306-002  Ethics in Decision Making Chapter 10:  Regulating Business George Z. Peng
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Learning Objectives The purposes of this Chapter is: To examine all types of regulation of business, not just that  imposed by government. To understand that in most forms of capitalism operating in  democracies, there is a mixture of regulations (market, self and  government) that provide a balance between government,  business, and society. To understand that a stakeholder approach is desirable   (Mintzberg,  1984) . Also to understand that regulation is one side of the story, the  other side is business counter-regulating. . 2
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3 Chapter Outline The Spectrum of Regulation Forms of Regulation: Market, Self, Government  The Scope of Government Regulation of Business Business Involvement in Politics Business Lobbying Corporate Public Affairs Departments Corporate Agenda The Impact of Decreasing Government Involvement Ethical Implications in Business-Government Relationship Ethics in Government
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4 10.1 Spectrum of Regulation Three types of regulation  that influence business  based on: (1)  Market forces; (2)  Self-regulation; (3)  Government.
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Self-Regulation vs. Government Regulation Self-Regulation: Faster, cheaper, ,more effective and  efficient than government. More likely to be accepted. Improves the relationship between  business and society, and allows  government to focus on other  priorities. Impairs competition and innovation  due to self-serving restraints by  industry participants. Results in lower standards. Difficult to enforce . 5 Government Regulation: Is necessary because society  cannot trust business self- regulation. Provides a countervailing power to  business on behalf of society. Is criticized for being oppressive,  ineffectual, confused, conflictual,  costly, rigid,  weakly enforced , and  amenable to capture by those it is  regulating…
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6 10.2 Forms of Regulation:  Market Regulation  No need for government-imposed laws or regulations Corporation influenced by market forces Laissez-faire approach Government does not interfere with business Consumers can force companies to behave in  particular ways by refusing to purchase  goods or  services or through boycotts . There may or may not be a connection between  business and society.
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7 Norms or standards that are developed, used and  enforced by the corporation itself:  mission , values  statement , codes of conduct or ethics The acceptance and practice of CSR is the most  general form of self-regulation. Criticism include:
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This note was uploaded on 10/12/2010 for the course BA 306 taught by Professor Z during the Spring '10 term at American University of Central Asia.

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Chapter_10_Regulating_Business_2 - BUS306002...

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