Assignment in Business Law, Ethics and Corporate Social Responsibilities

1. Introduction:

This paper answers sets of questions about business law, ethics, corporate social responsibilities and their applications in business.

2. Questions and Answers.

1.a.  Discuss and explain various ways that business become involved with United States legal system.  (half page, 5 points)

The  various ways that business becomes involved into the US legal system include the compliance with various commercial laws from formation, registration, operation, winding up and dissolution of these corporate entities.  There are other laws that must be complied with which will maintain their legal status of corporations and which could subject the  corporation and its officers to criminal or civil liabilities for violations.

1.b. Briefly outline the major components of civil suit (10 points, 1 page)

The major components of civil suit include the following: First, the must be a complaint about a cause of action against a person which may consist of action for damages caused or  injuries or breaches of contract or simple claims for money (State Bar of California, 2001). Second, the complaint is normally filed in court (State Bar of California, 2001).

Third, the parties may resort to discovery modes  where each party is given the opportunity to obtain all information possessed by the other (State Bar of California, 2001).  This process include deposition and interrogatories.

Fourth, the after the issues are joined when the other party has filed an answer, the case will go for the pre-trial conference where the parties are given the chance to settle the case instead of going to trial and to reduce possibly the issues before the cases be brought to trial (State Bar of California, 2001).

Fifth, the parties can now go to trial if the case is not settled during the pre-trial conference. In the trial,  the facts will be determined  by knowing what really happened, what one party did to other party as basis of complaint and any counter claim or cross claim if there is any (State Bar of California, 2001).

Counter-claims or cross-claims are kinds of pleading that are filed in lieu or in addition to the answer that  merely denies the allegation of the plaintiff or complainant. In the trial, the parties will have an equal chance to present their sides in form of presentation of evidence in support of their version of the facts and they will also make their arguments clear in an orderly manner as determined by the procedural rules of court.  The first to present one’s case will the complainant by an opening statement. This will be followed  by opening statement of the defense. There will be direct examination and cross examination of each other’s witnesses and this will be followed by rebuttal if deemed needed by the parties (State Bar of California, 2001).

     The last stage to the trial is when the case is submitted for decision. The next component is the rendering of the decision which will make a resolution of the issues and which may either terminate the case or cause the other party to appeal to higher courts. After a certain period in the last day decision of the court, the decision will become final for execution of the judgment rendered (State Bar of California, 2001).

1.c  Discuss various criticism of the US legal system.  What if anything can be done to improve the legal system?  (1/2 page, 5 points)

Various criticism of the legal system include the following:  (1)  That the current legal system is terribly burdened because of  not enough judges and courtrooms to accommodate all the cases filed.  The result of these is seen in long delays in the resolution of civil cases before the issues are ready to be scheduled for trial. (2) Many of the poor litigants cannot also afford the cost of the legal system.

There are legal fees that must be paid before a claim for damages or civil liability could be taken cognizance by the court. If the fees are not paid, the court cannot acquire jurisdiction over the case and for which there is claim whatsoever from the legal point of view and it will  not toll or stop the prescription period of the claim since there technically valid filing of complaint or claim (State Bar of California, 2001). To improve the legal system is to amend the law that would increase judges and courtrooms.

2a. Briefly describe and explain the major sources of law in the United States, including common law, statutory law and constitutional law. (10 points, half page)

The common law applies apart from the statutory laws. Since common laws derive it force and power from the cases decided by implied consent, the legal body or the US Congress does not make the same. There are the so called jurisprudence which became part of the law since the principles of the previously decided case could be used by the court in resolving subsequent cases. The statutory laws are enactments of the US Congress which may readily be found under the US Code of Law.

The constitutional law on the other hand contains the provisions of the US Constitution including the amendment which can affect the rights of parties in the litigation. The court can use one or a combination of these sources of law to resolve disputes but among the three it is the US Constitution that must be controlling since all other laws cannot be  violative of the Constitution. What ever may be declared unconstitutional by the Supreme Court is considered invalid will have no effect and will confer no rights or obligations (Lectric Law Library,2008).

2.b Choose four provisions of the US Constitution (including amendments) and explain how each impacts on business and/or affords certain rights to business corporations. (10 points, half page)

The four provisions of the US Constitution (including amendments) and the explanation of the impact of each on certain on business are as follows: First, the Fourteenth Amendment provision on due process of law (Findlaw, 2008) would also apply to business corporations since the latter are also considered as juridical persons which are protected under the due process clause. These corporations can sue in court to assert and protect their rights to due process. Second, the Fourteenth Amendment provision on equal protection clause (Findlaw, 2008)  applies to business corporations as well since they deserved to be treated similarly as other corporations  of the same conditions for classification as in case of same industries.

Third, the provision of Article 1, Section 8 that Congress shall have the power “to borrow money on credit to the United States,” (Findlaw, 2008) will surely affect the conditions of corporation since this power of Congress could affect the economy within which corporations operate.  Fourth, the provision of Article 1, section 8 that Congress shall have the power to “coin Money and, regulate the Value thereof…” (Findlaw, 2008) will surely affect the level of interest rate which can influence the cost of doing business for companies.

3a. Discuss and evaluate at least three ways the business community influences political process and the effect such influence has upon society.  Should anything be done to limit corporate influence upon the political process?  Explain your answer.  (10) (1/2page)

Three ways that business community influences political process are as follows: First business community can support or boycott a certain candidates in an election contest.  Second business community can lobby for the enactment of laws for a certain industry such as the Sarbanes-Oxley Act of 2002.  Third, certain industries can ask for tax exemption.

The effects of such influences upon society are as follows:  For the first influence, it would mean that business community can influence the result of political power in the community.  By so choosing or boycotting certain candidates, they could support the continuation of certain industry.   An example of this is the power of oil companies which has up to this time has in way prevented the use of alternative source of energy because of the big investments already made in the oil industry.

The effect of the second is the protection or preservation of the interest of the companies which may or may not necessarily be good to society. According to some it could prevent fraud like the case of Enron, but for some it increased costs of doing business which are translated to higher cost of goods in the market. The effect of the second is to promote and protect industry on ground of substantial distinction.

3b.  Discuss how the political environment and elected official in the United States impact corporate community.  Does the government have too much influence on corporate behavior?  Explain your answer. (1/2 page, 10 points)

The political environment and elected official in the United States can impact corporate community by the fact that said political environment and elected official will determine what kind of laws to be passed that would affect the corporate community.  There are many laws that could be passed and that could affect the corporate community.  To illustrate the Sarbanes Oxley Act of 2002 was passed to strengthen corporate governance of the US corporations.

The law was apparently passed to prevent corporate frauds as what happen in the case of Enron and WorldCom. For some quarters however, the law was being criticized as an overreaction and which essentially caused the cost of doing business to increase. The same has therefore a discouragement element for many companies to rather put up their money in non-US countries. On this latter basis, the government may be considered to have too much influence on corporate behavior.

4. Government regulation is pervasive in the United States. Discuss the regulatory environment in detail, including in your answer (a) arguments for and against the regulation of business; (b) the constitutional basis for government regulation for business; (c) recent trends in regulation; (d) various governments regulate business activity; (e) a specific example of government regulation and its impact on business and society; (f) the cost of government regulation and who pays the costs; (g) the future of government regulation. (1.5 page, 20 points)

Government regulation has it advantages since the market forces could not be allowed to determine everything in the promotion of public welfare by government.  Left alone the companies, may engage in any kind of illegal business and which could be dangerous to the community.  Too much regulation however could destructive to business. One example that can be used here is the case of Sarbanes Oxley Act of 2002 which is found by some to have increased the cost of doing business (Community Banker,  2004) while not attaining its designed purpose of preventing frauds in the corporate world.

The constitutional basis of regulation may come from plenary power of legislative branch of government to pass laws that it deems would promote public interest.  As to what will protect public interest is subject to different interpretation since lawmaking has two aspects. The other one is the exercise of it which is political in the sense that politician will act in what will caused the person to stay in office.  At the same time the passed laws may be subject to constitutional or legal question and its final out come will be declared by the Supreme Court.

       The most recent trends in regulation must be deemed to have come from the latest laws passed and from which it could be inferred that there is increasing government regulation and sometimes it is called already called government meddling or intervention in what purely should be determined by the market forces. This is illustrated in the case of Sarbanes Oxley Act of 2002.  These acts of politicians may be deemed however to be still within the Constitution since they think that what they do is what will again promote public welfare or public interest according to their interpretation.

It is fact that all governments in the world regulate business activities of their countries but there could be overregulation if these governments abuse their power.  An example of government regulation is the control of prices for certain commodities. This could have advantages and disadvantages but government is doing a matter of economic policy with the belief that it is good for the people. The cost of regulation is passed on to business corporations since the latter are made to pay for violations for said regulations including penalties.

Government is expected to exist so long as there is government because market forces could not completely attain social objectives aimed by governments. Therefore the present government regulation is bound to continue in the future as long as governments feel the need to protect the interest of the public.

5.  Corporate social responsibility and business ethics are terms that are often found in business and academic literature.  Discuss the concepts of business ethics and corporate social responsibility as they relate to today’s business environment. (20 points, 1.5 pages)

5.a.  A comparison of the term business ethics and corporate social responsibility, including explanation of “stakeholder management.”

Sometimes business ethics and corporate social responsibility (CSR) are treated as one and the same thing.  The history of corporations however reveal that business ethics is the broader term and should include corporate social responsibility for the latter came to be popularly known in the business circles sometime  in the 1960s  when the role of business was expanded to cultivating practices in ethics especially those affecting the environment ( McNamara,2008).  Stakeholder management may be deemed as an offshoot for corporate responsibility concept since the latter involves finding the common interest of stakeholders which is consistent with CSR.

5.b. The arguments for and against social responsibility and ethics in business.

The arguments for corporate social responsibility and ethics in business include the following: First, both are to protect the society from the possible abuses of corporations in their objective to promote their economic objectives. In other words, a social dimension is added by requiring corporations to have business ethics and corporate social responsibility

The arguments against corporate social responsibility and ethics in business include the fact the corporations may be using the same to hide true color of these corporations.  A case in point is where the companies appear in public to be the sponsors of Earth Day and other environmental sounding programs. This may actually be an act of disguise if not hypocrisy to cover up their wrong doings since the environment is still damaged incessantly despite business ethics and corporate social responsibility allegedly being practiced by concerned corporations.

5.c. Examples of corporate social responsibility and corporate irresponsibility.

Examples of corporate social responsibility is making it sure that a corporation has its code of ethics known to stakeholders particularly to those who are subject to the code while ethics in business would refer to how corporate management will make it sure that the code is implemented including its attitude on the matter.

5.d. What can be done by society to encourage responsible and ethical behavior in the business community?

What can be done is have the laws properly implemented which should include making corporations liable for their violations of the law.

5.e. A brief explanation of the steps you would take to implement an ethics program in an organization.

The various steps that I would take to implement ethics program in an organization include the following:  First there must be the establishment of standards and procedures to prevent and detect unethical conduct in the work place. The second step is to make it a part of the policy to involve the multiple layers of management who must know about the program. Third, there is a need to make sure that people with records of unethical conduct in the past should not be given authority for the enforcement of the program. The fourth step is to train the people who will be given authority and make is possible that the ethical policies are made now to those that may be bound.

This may consist in making employee training manual and employee policies manual.  The fifth step is to have the program implemented by ensuring that it is followed by creating and making known reporting mechanism and from  time to time, the program must be evaluated as to effectiveness. The sixth step is to punish the guilty and reward those who are complying.  The last step is for the management to show seriousness of the implementation by taking action on reported violations and resolve the same as soon a possible to deliver the message (Burrows, n.d.).

3. Conclusion

This paper has discussed and explained the various ways that business become involved with United States legal system from which the business organizations could be held liable in case they violate laws of the US legal system. This has also discussed several criticism against the US legal including certain ideas on what can be done to improve the said legal system. To back up the existence of the US legal system within which the business organization may operate, this paper has briefly described and explained the major sources of law in the United States, including common law, statutory law and constitutional law.  Several provisions of the US Constitution (including amendments) are mentioned and are explained how each impacts on business and/or affords certain rights to business corporations.

This paper has further discussed and evaluated several ways by which the business community influences political process and the effects of such influences upon society. This paper also has made a determination and explanation on whether anything should be done to limit corporate influence upon the political process. On the other side, this paper has also discussed the ways by which the political environment and elected official in the United States impact corporate community and determined whether government has to much influence on corporate behavior.

This paper has taken cognizance about the all-encompassing government regulation in the United States and has discussed the regulatory environment in detail, including arguments for and against the regulation of business; the constitutional basis for such regulation for business and the recent trends in regulation. This paper has also provided and illustrated the use of a government regulation and its impact on business and society; the cost of this government regulation and who pays the costs and made a forecast of about the future of government regulation in the US.

This paper has also discussed the concepts of corporate social responsibility and business ethics as found business and academic literature in relation to present business environment by comparing the two terms, the arguments for and against social each concept and providing example of each. This has also delved into finding ways to encourage responsible and ethical behavior in the business community with a brief explanation of the steps this researcher would take to implement an ethics program in an organization.

References:

Burrows (n.d.) Staying Alive:Creating an effective compliance and ethics program to prevent and detect employee misconduct, {www document} URL, http://72.14.235.104/search?q=cache:JMhAXf-ODpIJ:www.abanet.org/labor/lel-aba-annual/papers/2005/009.pdf+steps+to+implement+ethics+program+in+an+organization&hl=tl&ct=clnk&cd=4&gl=ph&client=firefox-a, Accessed October 25,2008

Community Banker ( 2004) , Study: Tech Investments Can Pare Cost of Sarbanes-Oxley Compliance, {www document} URL http://findarticles.com/p/articles/mi_qa5344/is_/ai_n21347672, Accessed October 25,2008

Lectric Law Library (2008) , Common Law {www document} URL http://www.lectlaw.com/def/c070.htm, Accessed October 25,2008

McNamara (2008), Business Ethics: Managing Ethics in the Workplace and Social Responsibility  {www document} URL http://www.managementhelp.org/ethics/ethics.htm, Accessed October 25,2008

State Bar of California (2001), Understanding the U.S. Legal System, {www document} URL  http://www.calbar.ca.gov/calbar/pdfs/publications/legalliteracy2001.pdf, Accessed October 25,2008