Legal enviroment Essay Example | Topics and Well Written Essays - 1250 words

Legal enviroment - Essay Example Furthermore, the essay also intends to explore if an individual is capable of self-regulation and how ethics can influence the regulation process. Issue The main concern in the context of government regulations in business area is that whether such regulations are necessary. The problem with respect to regulations is that thorough imposing them, the activities of people become delimited and thus managed by the government, thereby violating the rights of individuals. By regulations, the choices of people to conduct certain commercial activities are also restricted. Besides, it has also been argued that low regulations in business and low government intrusion can facilitate people and businesses to earn more revenue and thus they can spend more on economic development. However, to a certain extent government regulations in business is necessary in order to support productive business practices. Reasoning According to Jefferson (2012), human beings are able to live in a society, govern themselves by self-imposed regulations and secure the pleasure of life, freedom, property and peace. The basic reasoning behind self-regulation is that people have absolute rights regarding life and liberty to pursue happiness. Government regulations, if considered necessary, are introduced to secure the sanctification of these rights. The main reasoning behind regulations is that government has a responsibility to oversee the activities of people, because they cannot be trusted for making the proper choices. In the context of business, government regulations are used to control such activities which can otherwise result in business and ultimately market failure. For certain individuals, self-regulation is a contradictory element of business, but it also provides several advantages in the field of business. The five potential benefits of self-regulation are immediacy, flexibility, obedience, cooperative interests of industry and resources. On the other hand, self-regulation also has several disadvantages which comprise conflict of interest, insufficient consents, under enforcement, international competition and inadequate resources. Evidently, self-regulations comprise both benefits and limitations. Thus, it is neither an integrally effective nor an ineffective way to govern business conducts. The key challenge is to derive the condition in which self-regulation can be regarded as the proper strategy to encourage ethical behavior and also to find ideal methods of planning self-regulatory organizations. In reaction to corporate frauds, it is reasonable to decide who should regulate the behavior of business organizations and business transactions. In this context, it can be stated that it is not a simple choice to follow either government regulation or self-regulation, rather it is a query of how self-regulation can be utilized (Coglianese et al., 2004). Even if self-regulations have received blame from public due to corporate frauds, it cannot be uninhibited co mpletely. As an alternative, the solution would be to change the inner governance system of the self-regulatory organizations by permitting them new power or altering the level of government observation (Coglianese et al., 2004). Analysis Several sectors of businesses have long complained regarding government regulations and their restrictive characteristics. Government regulat