Professional Documents
Culture Documents
UNIT 3
PART A
UNIT III LEGAL ASPECTS OF ETHICS
Political legal environment; Provisions of the Indian
constitution pertaining to Business; Political setup major
characteristics and their implications for business; Prominent
features of MRTP & FERA. Social cultural environment and
their impact on business operations, Salient features of
Indian culture and values.
and government will impact on the prioritization of mental health policy in relation to other policies, the
funding available to mental health and the time frames in which policies and programmes can be realized.
This refers to set of laws, regulations, which influence the business organisations
and their
operations. Every business organisation has to obey, and work within the
framework of
the law. The important legislations that concern the business enterprises include:
(i) Companies Act, 1956
(ii) Foreign Exchange Management Act, 1999
(iii) The Factories Act, 1948
(iv) Industrial Disputes Act, 1972
(v) Payment of Gratuity Act, 1972
(vi) Industries (Development and Regulation) Act, 1951
(vii) Prevention of Food Adulteration Act, 1954
5.what are all the features of Ethical business Environment
Business environment is the sum total of all factors external to the business firm
and
that greatly influence their functioning.
It covers factors and forces like customers, competitors, suppliers, government,
and
the social, cultural, political, technological and legal conditions.
The business environment is dynamic in nature, that means, it keeps on
changing.
(d) The changes in business environment are unpredictable. It is very difficult to
predict
the exact nature of future happenings and the changes in economic and social
environment.
6.write down the importance of ethical business environment
The interaction between the business and its environment would identify
opportunities for and threats to the business. It helps the business enterprises for
meeting the challenges successfully. The interaction with the environment leads
to opening up new frontiers of growth for the business firms. It enables the
business to identify the areas for growth and expansion of their activities. It helps
the firms to analyse the competitors strategies and
formulate their own strategies accordingly
IFET CE BUSINESS ETHICS AND CORPORATE GOVERNANCE /VISHNU J/UNIT 2 VERSION
1.0
This right has been described by Dr. Ambedkar as the heart and soul of the Constitution.
In tact the mere declaration of fundamental rights is useless unless effective remedies
are available for their enforcement. This has been ensured under Article 32 which grants
the right to move the Supreme Court by appropriate proceedings for the enforcement of
the rights conferred by the Constitution.
POLITICAL SET UP
1.What is political system.
A democracy is a form of government in which the citizens create and vote for laws
directly or indirectly via representatives.* The idea of democracy stems back from
ancient Greece and the profound works of ancient academics. However, the presence
of democracy does not always mean citizens wishes will be equally represented. For
example, in many democratic countries immigrants, and racial and ethnic minorities
do not receive the same rights as the majority citizens.
ii.
iii.
iv.
the profits derived from the production, supply or distribution of any goods or
services.
Giving false facts regarding sponsorship, affiliation etc. of goods and services.
Giving false guarantee or warranty on goods and services without adequate tests.
The Foreign Exchange Regulation Act (FERA) was legislation passed by the Indian
Parliament in 1973 by the government of Indira Gandhi and came into force with
effect from January 1, 1974. FERA imposed stringent regulations on certain kinds of
payments, the dealings in foreign exchange and securities and the transactions which
had an indirect impact on the foreign exchange and the import and export of currency.
[1]
The bill was formulated with the aim of regulating payments and foreign exchange.[2]
FERA :
Consisted of 81 sections.
All branches of foreign companies (except air lines and shipping companies) seeking
approval under FERA have to convert themselves into Indian companies.
ii. A minimum permissible foreign share holding limit of 74 per cent will be allowed to
companies engaged in manufacturing any item listed in Appendix-I of 1973 Industrial
Policy or predominantly export-oriented or engaged in any industry using
sophisticated technology or tea plantation or manufacturing companies engaged in
trading provided trading constitutes less than 25 per cent of ex-factory value of
production or has a turnover of less than Rs. 5 crores.
iii. A permissible foreign share holding of 40 per cent will be allowed for companies
engaged in other manufacturing items which neither use sophisticated technology nor
are listed in Appendix I.
However, these companies will have the option to change the charter of their
manufacturing operations or by becoming predominantly export oriented or by
manufacturing items listed in Appendix I. In such cases the maximum permissible
share holding would be 74 per cent.
iv. If a company is 100 per cent export-oriented, a foreign share holding exceeding 74
per cent may be allowed.
v. Airlines and shipping companies as well as banking companies are exempted.
IFET CE BUSINESS ETHICS AND CORPORATE GOVERNANCE /VISHNU J/UNIT 2 VERSION
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vi. Since 1985, due to Governments liberal economic policies, legislations like FERA
and MRTP have become more and more irrelevant.