Importance of Law and Its Role in the Business Environment

Introduction

Different types of businesses operating in a business environment are usually expected to comply with payment of tax requirements. The entire process of taxation within the business environment for the players involves usually guided by the law on taxation. Various government authorities are normally responsible for the implementation of the legal taxation frameworks that affect the manner in which different structures participate in the payment of tax. Some of the businesses whose operations are commonly influenced by the taxation law include corporations, partnerships, and sole proprietorships. Essentially, law involves various rules and regulations that assist in conduct governance, resolution of disputes, and addressing criminal actions. Several roles are served by them in the society as well as a business environment (Grelecki & Willey, 2017).

Role and importance of law in the business environment

Business managers and other players in the field of business are often specialists and expert in certain specific areas of business. However, it is worth appreciating that certain decision in a business environment that requires the input of legal experts. The understanding of various laws and their application in a business environment is critical because helps to avoid making incorrect decisions on legal matters affecting a given business. The application of laws in a business environment assists business plays by establishing appropriate guidelines for the facilitation of key decisions. As a disciple, the field of law is broad and characterized by several categories and components serve different functions in a business environment. Employment laws are crucial when it comes to giving guidance on the manner in which employees relate and interact with employees in a business environment. Employment laws usually address issues relating to payment of employees and the associated disputes. Employment laws also provide guidance about the manner in which governments across the world relate to workers in the business sector (Miller & Crain, 2011). In this regard, governments are guided by employment laws to perform the implementation role in ensuring that various workers and employees working in the business sector are paid salaries and wages that are commensurate with their qualifications as well as roles and responsibilities. Furthermore, the employment laws play a considerable role in guiding different authorities to ensure that safety workplace measures are in place and businesses can provide favorable conditions of working for their employees and workers.

According to Zwarensteyn (2007), the rule of law in a business environment influences the establishment of the relevant regulations and guidance that businesses and people are expected to follow for a sense of orderliness to prevail. Not only does the rule of law in a business environment makes it possible for players in the business industry to understand their legal roles and expectations but it also creates regulations to be followed by their business enterprises. Also, the adoption and application of laws in a business environment restrain various external forces from infringement on the rights and properties of various businesses that are in operation. There are always predictable channels and processes within the law that make it possible and easier to carry out a peaceful resolution of various business disputes. The rule of law in the world of business is a critical consideration owing to its significant role in ensuring the availability of relevant checks and balances in various areas of business. For instance, the legal system in the United States creates a sophisticated structure of operation where the business environment is governed and regulated by the coexistence of federal and state laws. Through exercising the rule of law in a business environment, it becomes easier to govern, monitor and control different business contracts that take place between different business entities as well as business individuals. Under the system of common law, there are necessary legal requirements that have to be met for a business contract to be regarded as complete, satisfactory and legally binding.

The findings made by Miller and Crain (2011) indicate that most major corporations and business entities usually rely on the application and implementation of the rule of law in their environments of operation to enforce the legal requirements associated with the contracts in which they enter with other business players. In this respect, every party in any business contract understands his or her obligation according to that is expected to be honored courtesy of the rule of law that governs contractual interactions between different business partners. The application of the aspect of law in a business environment plays a vital role in enabling various business entities and corporations to have a clear understanding of their legal roles and responsibilities as part of their commitment to the rule of law. Any individual or any business entity that contravenes the legal requirements and regulations as legally provided under the rule of law is subject to a process of legal recourse. The practice of law in an environment characterized by business contacts and transactions ensures that different properties in business remain adequately protected under legal frameworks existing with a particular business environment. The protection of tangible properties belonging to business people takes place in a business environment upon being facilitated by the rule of law. For example, the transfer and maintenance of legal ownership of tangible business properties are usually conducted under the guidance of a system of law in business.

Law in business is crucial since it is relied upon by businesses to manage the processes and relationships involved in interactions with creditors and debtors. Whenever, financial matters in business go against the expected outcomes, and business finds itself facing the threats of bankruptcy, the legal system has a way of ensuring that such a business is protected from a creditor who may want to take advance of its situation. In that regard, the legal system goes to the extent of ensuring that the properties of business are protected from unfair and unjust repossession while the business is still struggling to attain financial stability. The presence of an efficiently and effectively working system legal system within a business environment ensures that individual personalities are adequately protected from the business entities associated or attached to them. For instance, antitrust legislation enacted by the United States Congress has been playing an instrumental role in preventing anticompetitive activities and practices in a business environment such as fixing of prices and colluding. According to this particular law, business enterprises are also prohibited from engaging in deceptive advertising and marketing practices that may cause injuries to consumers or unfair competition to other businesses in the same industry (Benlemlih & Girerd-Potin, 2017).

Moreover, the application of the rule of law in a business environment ensures that businesses stay protected from rogue governments by ensuring that every institution including governmental institutions is subject to the rule of law. As such, governments are also expected to operate by the rules and regulations that are set to guide interactions and activities in a business environment. The law prohibits governments from operating outside jurisdictional limits or restraints. This because businesses that end up running in situations that are characterized by lawlessness and impunity are highly likely to face significant losses and even closure. Fundamentally, the rule of law in a business environment ensures that governments do not go to the extent of manipulating different business by coming up with outrageous demands and regulatory requirements such as excessive taxes. The rule of law plays its role in a business environment by influencing the operations and processes taking place in different disciplines. For instance, the employment laws do govern not only interactions between employers and their employees but also provides a critical framework that offers legal guidance when it comes to the management of human resources for businesses. Grelecki and Willey (2017) explore the roles of law in the business environment by analyzing the situation that would characterize this environment in the absence of the legal enforcement rules according to business legal frameworks. In this respect, the absence of an effective legal system in the field of business would have effects on contracts in the sense that parties to a contract would not be committed to honoring their contractual obligations.

In most cases, the absence of legal frameworks governing contractual agreements would most likely leave the fulfillment of the relevant obligations to the whims and goodwill of the parties involved. As such, contractual agreements and obligations would only be binding in situations where the beneficiaries have effective authorities to enforce them. Moreover, there is a high likelihood that the aggrieved parties may end up with no choice but to resort to extra-legal means of enforcement of some of the contractual obligations involved. When it comes property right, the absence of appropriate laws governed by an effective legal framework is likely to cause business individuals and corporations to have a tendency of being more selective and choosy when acquiring assets. In this case, it would be convenient for them to acquire only the properties and assets whose property rights they can manage maintain through own means of enforcement. Such kind of a business environment would cause many business people to opt to liquidate their business properties and assets and properties before keeping them in the form of portfolio investments or deposits in other countries abroad where the business legal system is functional. This move would end up have negative effects on the economic growth and development of a particular country since pressure would begin piling on the value associated with its local currency thereby making it weaker. Furthermore the absence of functional law in a business environment would imply that some of the operations of certain corporations would be halted to the extent of the entire businesses having to close down (Miller & Crain, 2011). 

Ethical Theory and its Role in the Formation of American Jurisprudence

In analyzing the role of ethical theory in the formation of the American jurisprudence as far as the business law is concerned, Simon (2011) observes that ethical theory remains a crucial requirement whenever there is need to answer questions emanating from the legitimacy and legality of normative ethics in business activities. In turn, the state of normative ethics influences the status of according to the ethical jurisprudence. The acceptance of normative ethics in as part of the American jurisprudence is an implication that most of the solutions the questions of ethical jurisprudence that have been coming up in the business environment could have their basis in the understanding of critical philosophical principles. As pointed out by Toh (2013), unethical business operations and activities often bring about aspects of moral confusion and distrust among the players and stakeholders in a business environment. The act of business people giving in to temptations of abuse of responsibility, opportunism, and greed contributes considerably towards the presence of serious ethical challenges in areas of labor relations, the environment, and consumer welfare. While it may be observed that that behavior codes, legislation, and regulations by the relevant authorities address some of the issues associated with corruption and lack of morality in a business environment, prevention of unethical business practices could be significantly influenced through the provision of specific lessons and guidelines about business ethics.

The explanation offered by Grelecki and Willey (2017) on the role of ethical theory towards the formation and sustainability of the American jurisprudence indicates that the aspect of ethical consideration has always aimed at fulfilling duties to morality and ethical obligations. To that extent, business operations in an environment characterized by the features of a free market economy serve a hypothetical basis whereas markets in real-life circumstances are often subjected to legal restrictions and regulations. Most of the theorists in the field of business ethics agree with the view that business people would be expected to have certain legal obligations in their business environment that are above their interest. However, extensive debate still exists about the actual considerations to which business individuals and entities would be expected to be obligated ethics and law. If a business entity has stakeholders or investors, the owner of such an entity is faced with a legal obligation and duty to always act in their best financial interests. Some scholars would bring about the argument that the owner of that particular business entity would also be ethically obligated to carry out his or her functions in a manner that serves the best interest of the environment, the community, and the workers as well as several other stakeholders. Some business people may consider themselves as having a personal obligation to uphold ethical principles that significantly influence their personal and religious beliefs.

The assertion by Benlemlih and Girerd-Potin (2017) indicates that the understanding of the role of ethical theory in any given jurisprudence may only be important and useful in a situation where one has previous has an extensive interaction with that particular jurisprudence. The Civil Rights Act in the United States is among the laws that influences the business environment with regard to the manner in which business and employers are expected to treat their human resources. This act prohibits businesses and employers from acts of any form of discrimination against their employees or workers. Simon (2011) maintains that the last couple of decades have experienced recognition by different legal ethicist when it comes to the decisions made by business people and their legal advisors of the significance of a particular jurisprudence. However, most of the occurrences in the recent business environments have had the tendency of placing more focus and emphasis towards the analysis of ethical theories in relation to the legal duties and obligations of people involved in business operations and activities. The American jurisprudence that has been undergoing a continuous process of formation over the last couple of years for the perspective legal ethics and jurisprudential theories appear to have gone against the idea of taking responsibility for moral obligations in a business environment. This is largely attributable to the fact that most business people and entities would have the tendency of making critical decisions that are informed by the financial interest of their key stakeholders at the expense of their moral duty to decide and act under the guidance of ethical requirements and expectations in a business environment. 

The clarification made by Toh (2013) the relation between legal obligations and moral obligations in a business environment indicates that the jurisprudential turn that is believed to have taken place in matters of legal ethics represents a shift that changes focus to the analysis of legal issues away from moral issues. This happens to be the present state of affairs owing to the professional roles and responsibilities held by most business people and business entities who are key players in any business environment. It would be expected that the major stakeholders in a business environment governed useful and functional frameworks would raise fundamental questions regarding the manner in which legal experts tend to interpret issues of morality. However, that has not been seen to be taking place in the previous processes towards the formation of the American jurisprudence. Miller and Crain (2011) established that corporate law plays a fundamental role when it comes to the formation and operation of corporate businesses. In this regard, state corporate codes of conduct are charged with the responsibility of ensuring the formulation and implementation of rules and regulations that govern the process of forming corporations. Also, there are federal laws that govern the processes involved in buying and selling of corporate business entities. A significant portion of the law used in ensuring a secure buying and selling of such entities finds its basis in the Securities Act of 1933 as well as the Securities Act of 1934 of the federal laws of the United States. These acts are also responsible for governing the issuance of stock where they offer protection to different business players and stakeholders from stock prices manipulation by unscrupulous business people. 

Zwarensteyn (2007) contends that several other laws are critical for the facilitation of business operations and activities depending on the type of business and the jurisdiction of operation for that particular business. For instance, a business environment involving the sale of food could have its operations governed and regulated by laws represented by the municipal health codes. Similarly, businesses involving the transportation of hazardous substances and chemicals are expected to operate and function under the guidance of Federal Occupation and Safety Laws that are meant to offer the relevant protection clients, businesses, workers, and members of the public. Tax codes are meant to act as laws that guide and regulate various taxes charged on products and services as well as wages and salaries.

Certain ethical dimensions place more emphasis on the importance of ethical theories in understanding and interpreting the American jurisprudence in the business environment. This is because people who are involved in business activities of operations are often faced with the responsibility of making decisions that are associated with ethical significance almost daily. Most of such decisions are usually made about ethical theories either intentional or unintentionally. Having a deeper understanding of the critical ethical theories on the manner in which legal matters influence business operations assists business people to have a broader view of ethical concerns and incorporate them into business decisions. The integration of ethical considerations in business activities and operations often involves some of the core components of ethical philosophy. In this respect, the focus of business ethics usually entails legal obligations that are meant to uphold moral standards. Such standards apply to individual business people as well as large corporations and business entities (Simon, 2011).

Conclusion

In conclusion, it is important to acknowledge that the concept of law and the associated legal components for both criminal and civil law have a crucial role to play in governing and regulating different business operations and activities taking place in a business environment. It is clear that business laws and the supporting legal frameworks entail various rules and regulations that assist in conduct governance, resolution of disputes and addressing criminal actions in a business environment. Notably, the integration of ethical considerations and legal obligations in business activities and operations are often influenced by stakeholder interests.

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