Global Business Environment and CSR: A Comprehensive Analysis

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Context of business

Contents
Introduction......................................................................................................................................2
The dynamic and changing nature of the business..........................................................................3
Future of organizations within the global business environment................................................3
Need for individuals and organizations to manage responsibly and sustainably and behave
ethically in relation to social, cultural, economic and environmental issues...................................5
Impact of CSR on leadership in a modern organization..............................................................5
Conclusion.......................................................................................................................................6
References........................................................................................................................................7
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Introduction
The business environment is changing very fast today due to the availability of the new
technologies which results in the globalization of business. A business is responsible towards the
society and its people and it should consider the ethical aspects while conducting any business
activity. A business is required to behave ethically and should be responsible as well as
sustainable to cope up with the social, economic, environmental and cultural issues (Shenkar,
et.al, 2014).
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The dynamic and changing nature of the business
Every business operates its activity in a dynamic environment. There are many factors available
in a business environment and these factors are responsible for dynamic change in the business.
Advancement in technology, changes in demand of the people, changes in climate condition and
changes in the economy of the world are responsible for changing the nature of the business.
These factors are driving business to globalization (Shenkar, et.al, 2014).
For example- changes in the demand of consumer will put pressure on the business for new
product development or modification in the existing product and that is how a business is
required to adopt these changes on a continuous basis
Future of organizations within the global business environment
Global business environment
The global business environment is broadly shaped by many factors available within a business
and these factors are externally or internally related to the business. Competitive dynamics,
intercultural effectiveness and advancement in technologies are driving a business towards the
globalization and also influencing a business in its resources use and decision making (Shenkar,
et.al, 2014).
Microenvironment factors
It includes those factors that affect decision making, performance and business strategy of an
organization and affects business at a small scale. There are some types of microenvironment
factors are as follows (Gammeltoft, et.al, 2010)
Customers
Customers are the main asset of an organization and their satisfaction with the product is
necessary to create demand for the products. Changing in the demand, preferences and taste of
the customers affects a global business because the taste and preference of the people of China
might be different from the people of Australia.
Suppliers
Suppliers are responsible for managing the supply of goods and services in the market. They
ensure the availability of an adequate supply of products for its timely delivery. Changes in the
demand of suppliers or non-availability of adequate supply will impact the future growth of a
business (Gammeltoft, et.al, 2010).
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Employees
Skilled employees take responsibility for organisational success and they work hard to achieve
business goals. If the employees are not motivated or engaged in their work it will impact the
performance of an organization.
Investors
Investors are a great source of funding for a business. The availability of great investors manages
the financial issues related to business and ensures that a business can complete all the global
business activities with the utilization of sufficient fund. Any kind of conflict with investors may
restrict the continuous funding for a business(Gammeltoft, et.al, 2010).
Macro environment factors
These factors are externally related to a firm and affect business on a large scale. Some types of
macro environment factors are as follows
Social and cultural issues
In a global business environment, it is necessary for an organization to develop its business
strategy in that way that it satisfies needs and demands of the customers of different religion and
culture as the culture of a country is different from another country. The changes in lifestyle,
preferences determine the purchasing behaviour of the people and cultural barrier may occur in a
global environment as the language, religion, behaviour of the people are vary from country to
country and that may impact the future development of a business (Viswanathan, et.al, 2014)
Economic issues
Growth and development of the economy, increased unemployment rate impacts the
performance of global business. Suppose if the economic development of a country is low than a
business cannot get success thereby distributing its products in a low economic development
area. Developed economy improves the living standard of the people and that creates demand for
the products. An effective business strategy can help to make balance with these changes
(Morrison, 2011).
Environmental issues
Climate change, availability of natural resources, pollution and waste disposal impacts the
environment of the country. The climate condition of one country could be different from
another country and that impacts import or export of goods in a particular country. These factors
are not in control of a business and impacts the operations of a business (Morrison, 2011).
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Need for individuals and organizations to manage responsibly and
sustainably and behave ethically in relation to social, cultural, economic
and environmental issues
An organization is responsible towards the society and its people to maintain the relationship
with them.it is called corporate social responsibility an organization should focus on sustainable
business development that will result in the economic and social development of a country
(Carroll and Shabana, 2010). Sustainable development reduces the wastage of water and
pollution which harms the environment of a country. A business is responsible to conduct its
activity in that way it does not harm the society and environment. They should establish effective
pollution control system as well some rules and regulation must be followed to maintain the
sustainability of the environment. A business should focus on innovation and new product
development as well should provide employment opportunities to the society which would result
in economic development (Cuervo, 2011).
Ethics are a set of norms or principles defined by an organization to govern or control the
organisational activities and its people so that they can work in the benefit of society. An
organization is also liable to follow the government rules and regulations to conduct its business
activities in that way that it does not harm society or its people (Jennings, 2014).
Impact of CSR on leadership in a modern organization
CSR establishes goals or standard for the people of a modern business organization which must
be achieved by the combined effort of everyone in the organization. A leader takes responsibility
for directing and motivating the employees to fulfil the goals of CSR and makes them aware of
their roles and responsibility towards society. A leader encourages its team members to work in
that manner it does not impact the society in a negative way (Werther and Chandler, 2010).
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Conclusion
From the above discussion, it can be said that the global business environment issues have a
great impact on the Globalisation of a business and a business is responsible towards sustainable
development to reduce the impact of economic, environmental, social and cultural issues which
impacts the society and its people. A business is also required to follow some ethics to maintain a
good relationship with society and people related to the business. Further, corporate social
responsibility encourages a leader to perform his job roles in an effective way.
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References
Carroll, A.B. and Shabana, K.M., 2010. The business case for corporate social responsibility: A
review of concepts, research and practice. International journal of management reviews, 12(1),
pp.85-105.
Cuervo‐Cazurra, A., 2011. Global strategy and global business environment: The direct and
indirect influences of the home country on a firm's global strategy. Global Strategy Journal, 1(3‐
4), pp.382-386.
Gammeltoft, P., Barnard, H. and Madhok, A., 2010. Emerging multinationals, emerging theory:
Macro-and micro-level perspectives.
Jennings, M.M., 2014. Business: Its legal, ethical, and global environment. Nelson Education.
Morrison, J., 2011. The global business environment: Meeting the challenges. Macmillan
International Higher Education.
Shenkar, O., Luo, Y. and Chi, T., 2014. International business. Routledge.
Viswanathan, M., Jung, K., Venugopal, S., Minefee, I. and Jung, I.W., 2014. Subsistence and
sustainability: from micro-level behavioral insights to macro-level implications on consumption,
conservation, and the environment. Journal of Macromarketing, 34(1), pp.8-27.
Werther Jr, W.B. and Chandler, D., 2010. Strategic corporate social responsibility: Stakeholders
in a global environment. Sage.
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