BUSINESS ENVIRONMENT

Understanding the environment within which the business has to operate is very important for running a business unit successfully at any place. Because, the environmental factors influence almost every aspect of business, be it its nature, its location, the prices of products, the distribution system, or the personnel policies. Hence it is important to learn about the various components of the business environment, which consists of the economic aspect, the socio-cultural aspects, the political framework, the legal aspects and thetechnological aspects etc. In this chapter, we shall learn about the concept of business environment, its nature and significance and the various components of the environment.In addition, we shall also acquaint ourselves with the concept of social responsibility of business and business ethics.

OBJECTIVES
After studying this lesson, you will be able to:
• explain the meaning of business environment;
• identify the features of business environment;
• describe the importance and types of business environment;
• describe the recent developments in Indian Economy that have greatly influenced the working of business units in India;
• explain the concept of social responsibility of business;
• state the social responsibility of business towards different interest groups; and
• explain the concept of business ethics.