Establishing a business is a long journey for every successful entrepreneur. There are laws governing any type of business and every business person should comply with these laws. The motive of venturing into business is to make profits and grow the business, however, for all the two to be successful, there are ethical and legal issues that surround such a business. We are going to look at Wal-Mart as an example of a well established business that operates globally. We are going to analyze the legal and ethical issue that surrounds such business.
Wal-Mart is a Multinational retail corporation that is based in America; the company operates a chain of discount stores, hypermarkets and grocery stores. It is a Global company that is known for its efficiency in service delivery in all the departments. The company was established in the year 1962 and it has since operated as the best company that offers all services under one roof. The company continues to grow with the advance technology. Recently, Wal-Mart launched the use of internet to sell its products and services and this has boosted the business. It is evident that the company focuses on quality product and service delivery which is the reason as to why it continues to flourish.
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The company complies with all the regulation regarding any business. The ethical and legal consideration forms the basis for the success of the business, as well as competent team of leaders and staff who are working towards retaining the competitive position of the business. According to the Vision statement of Wal-Mart, it seems that the company focuses on the use of price as the selling point in order to attract more customers. The company’ slogan is ‘save money, Live better’ is clear information on the main target customers to be people who would like to spend their money of quality and not quantity (Stuerer, 2008) .
Wal-Mart takes its pride on the legal environment that has fostered a best platform for the company to satisfy its customers. It is important to note that any business rely on both the internal and external environment to establish strategies that will promote sales (Hasl-Kelchner, 2006) . For the case of Wal-Mart, the external and internal environment is a great opportunity that has enabled the company to set strategies to excel, in business. Since its founding in the year 1962, the company has seen its success by adhering to three main principles; the first principle focuses on provision of services and value to customers by offering the best products at affordable prices. Second principle is on corporate dedication to partnership between the company, the employees, the management and ownership. This principle has enabled Wal-Mart to continue experiencing quality service provision which channels down to long term customer relation. The third principle is the corporate social responsibility whereby it focuses on commitment to the United States and all the communities to which the stores are operated globally. All the business practices in Wal-Mart are consistent with the three principles.
There are three specific laws that apply to the business in Wal-Mart stores, these laws are the basis for the success of the business. In every business, there are laws that enable smooth running of all activities pertaining profit making. Business laws are set of rules and regulations that any profit making activity should comply with. These laws protect the business, the customers and those who work in the business. For the case of Wal-Mart, the three laws are;
International business transaction laws: Food safety regulation; this law stipulates all the regulations in regards to food handling and safety, Wal-Mart has invested in this law as a strategy to promote its service delivery. The company ensures that the foods they supply in all the grocery stores globally are safe for human consumption. The company has put in place mechanisms to research and analyze all types of food they supply so as to meet the standards for food safety and regulations. From the customer’s point of view, the foods supplied by the company are safe for consumption and are of good quality. Taking a look at the grocery stores, the company ensures that all groceries reach customers when fresh, therefore there is effective value addition and transportation for fresh produces that gives the company credit for quality groceries (Hamilton & Webster 2015) .
Employment regulations laws; the company values its employees because it is believed that the success of any business relies on the efforts of all the associates(employees).for Wal-Mart, the employment regulation has been one of the basis for establishing a strong relation with its employees. The company complies with the regulations that guard employees against manipulation by most companies. The fact that the company operates globally sparks a sensitive concern in regards to how it manages all the employees. For any company, hiring and retention of employees is a critical aspect, because there are issues that arise from employees that could affect the flow of business, however, for the case of Wal-Mart, the employees are offered the best package in terms of compensation. This motivates employees and enables them to perform better. The human resource team sets strategies that promotes welfare among employees and enables them to channel their complaints in the right manner. This has seen the company receive awards in terms of good working relations.
Constitutional law: tax regulation; this is another legal aspect that poses a threat to the company. Every business has to comply with tax regulations, and most business fail because of not complying with tax laws. When the tax rates are increased, a company will be forced to sell more so as to pay tax, however, most companies tend to evade tax and this can result to serious criminal offence. Wal-Mart complies with the tax laws and ensures that all operations are geared towards sustaining a competitive environment, therefore when there are reforms in tax the company can be forced to pay more taxes. This is one of the legal threats experienced by the company when analyzing the external environment (Jennings, 2014) .
The journey to achieving competitive strategy, avoiding pitfalls from the legal aspect and shaping the decision in business should be the three main aspects of any strategic plan of a business. Business relationships are based on contractual agreements and these results from procedural laws. Taking a look at general laws regarding to business and Wal-Mart, we are going to evaluate these laws; advertising and marketing laws, online business laws and intellectual property laws. Advertising and marketing laws demands for honesty when advertising, according to Wal-Mart, Honesty is one of the core values, therefore the company complies with advertising and marketing laws whereby all the adverts communicate honesty in regards to the products and services from Wal-Mart, it is because of this reason that the company continues to win.
The Online business laws guide any business conducted through internet; for the case of Wal-Mart that recently launched an E-commerce platform, the company complies with the online business laws that protect customers from various scams that take in the e-commerce platform. When it comes to online business, it is important to understand that such kind of businesses are conducted globally, therefore Wal-Mart has to ensure that customer information is private and confidential, by complying to the laws. Intellectual property laws enable a business to protect its products through patenting. Wal-Mart protects its business name through trademark, which does not allow any other business to have the same name as that of Wal-Mart (Hakemy, 2017) .
According to philosophy of economist Milton Friedman “ “There is one and only one social responsibility of business — to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.” This Philosophy is opposed by the executives in Wal-Mart because it focuses only of profit making. However, with the current business environment, Wal-Mart opposes the philosophy basin on the several factors that surround business. People need more of business as opposed to profit making activity. Consumers expect attributes from their purchasing such as; value, quality and safety of the products and services. Employees on the other hand expect more than a paycheck; for example rewards promotion, trainings and other motivation factors that are not money related.
When it comes to the community, it is expected that a business will promote a culture that will benefit those living around the business premise. Regulators on the other hand will expect the business to comply with all the laws that govern any business. Taking a look at Wal-Mart, the Philosophy does not apply to the operations of the company. This is because the company operates globally and hence its operations should meet people’s expectations. The company meets employee expectations by designing the best compensation strategy; it also meets the expectations of customers by ensuring that the products and services are of good quality, valuable and safe. On the aspect of regulation, the company complies with all the business laws and it also practice corporate social responsibility by ensuing that the community benefits from the company’s projects (Lawrence & Weber,2014).
The choice of actions in every company has ramifications that could either derail the company’s performance or promote excellence. An ethical framework that has influenced the executives of the company in regards to the Milton’s Philosophy is the Duty framework. In the Duty framework, the company focuses on obligations and duties that are stipulated. The company focuses on the ethical obligations provided and ensures that these ethical considerations are in consistent with the principles that guide its operations. The Duty framework influences a positive working environment by encouraging companies to treat people equally by meeting the ethical expectations (Twomey, Jennings & Greene 2016) .
Wal-Mart is a global company that operates in nine countries globally; customers expect to be treated equally when delivering on the service and products, the same case applies to employees, regulators and the community. The ethical framework stipulates all the guidelines in regards to treating people, therefore the company has applied the duty framework on the operations that will impact positively on employees (Bagley,2015) . The employees are expected to treat customers with high moral character and respect; this promotes the ethical consideration in business. Take for example the online business conducted by the company, this platform has challenges in regards to customer service and the company has been able to face some of the challenges such as confidentiality of customer’s information, honesty of the products and services delivered and also honest information sharing when advertising and marketing. Legal actions when there is a bridge of any ethical consideration are taken seriously by the company; this is because the company is committed to serving people and promoting a business environment that treats people equally. All employees are expected to comply with ethical guidelines in their roles and this has enabled the company to continue winning despite the many challenges facing the business industry.
Reference
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Hamilton, L., & Webster, P. (2015). The international business environment . Oxford University Press, USA.
Jennings, M. M. (2014). Business: Its legal, ethical, and global environment . Nelson Education.
Twomey, D. P., Jennings, M. M., & Greene, S. M. (2016). Anderson's Business Law and the Legal Environment, Comprehensive Volume . Nelson Education.
Bagley, C. E. (2015). Managers and the legal environment: Strategies for the 21st century . Cengage Learning.
Lawrence, A. T., & Weber, J. (2014). Business and society: Stakeholders, ethics, public policy . Tata McGraw-Hill Education.
Hakemy, S. (2017). Capitalism and Freedom . Macat Library.
