Chapter 4 & 5 Flashcards
(15 cards)
What is the relationship between business organizations and society?
Business organizations and society (specifically the environment) are mutually dependent. Their relationship becomes more complex with variables like technological innovation and political developments.
How do economic changes influence business management success?
Back: Inflation, interest rates, and exchange rate fluctuations affect costs, pricing, and profitability. Economic downturns may reduce consumer spending, impacting sales and growth.
What is the impact of technological changes on businesses?
Back: Advancements in AI, automation, and digital transformation improve efficiency but require investment. Businesses that fail to adapt risk becoming obsolete.
How do political and legal changes affect business operations?
Back: Government policies, tax laws, labor regulations, trade policies, and tariffs impact operations and global supply chains.
Why are social and demographic changes important for businesses?
Back: Shifting consumer preferences and generational behaviors require adjustments to products/services. Workforce demographics (e.g., aging populations, Gen Z) impact HR strategies.
What role do environmental and sustainability factors play in business?
Back: Climate change and sustainability pressures push businesses toward eco-friendly practices. Regulations on carbon emissions and waste management require compliance.
How do competitive market changes challenge businesses?
Back: New competitors and disruptive business models (e.g., e-commerce, fintech) challenge traditional companies. Businesses must innovate to maintain market share.
What is meant by the “interrelatedness of environmental factors” in business?
Back: The business environment consists of interconnected factors (economic, technological, social, political, environmental). A change in one can impact others. Example: AI advancements affect labor markets and regulations.
Why is the modern business environment considered increasingly unstable?
Back: Rapid shifts in market conditions, consumer behavior, and regulations occur. Example: E-commerce and digital payments force traditional retailers to adapt quickly.
How does environmental uncertainty affect businesses?
Back: Future trends, competition, and external shocks (e.g., recessions, pandemics) are unpredictable. Businesses must use risk management and scenario planning.
What is Corporate Social Responsibility (CSR)?
Back: A business approach ensuring ethical, sustainable, and socially responsible operations. It integrates social, environmental, and economic concerns into business practices.
What are the four categories of CSR?
Back:
1. Economic Responsibility – Profitability with ethical operations.
2. Legal Responsibility – Compliance with laws.
3. Ethical Responsibility – Fair and just practices beyond legal requirements.
4. Philanthropic Responsibility – Giving back to society.
What is Environmental Responsibility in CSR?
Back: Minimizing negative environmental impact through sustainable practices like reducing carbon footprint, sustainable resource use, pollution control, and eco-friendly products.
What is Corporate Governance?
Back: The system of rules, practices, and processes directing and controlling a company. It ensures accountability, fairness, and transparency with stakeholders.
Why is good corporate governance important?
Back: It promotes ethical decision-making, protects shareholder interests, and enhances long-term sustainability by balancing economic performance with social and legal responsibilities.
