Sunday, 28 May 2017

Responsibilities of a business towards Investors, Government and Consumers

As already mentioned in the previous post, every business has certain responsibilities towards all the stakeholders. Given below are the responsibilities of a business towards the investors,

Responsibility towards Investors: 

Return on Investments–
  • Investors take the risk and invest money in the business to earn good returns (interest)
  • Hence it is important that they get fair returns/Income on their Investments

Transparency–
  • It is important that the business is transparent in dealing with investors.
  • The business should pass on all the necessary information to the investors
  • This helps business to win the trust of the investors

Grievances Management–
  • Every company must have proper grievances handling mechanisms in place for the investors
  • The concerns of investors (if any) should be heard and efforts must be made to solve them quickly
Proper Disclosure of information–
  • The business needs to send regular reports and statement of profits to the investors
  • The company needs to give a true picture of its financial performance.

Proper Conduct of the meetings–
  • Regular meeting with investors should be held to update them about the  performance of the company
  • Notices of such meetings should be sent to all the investors in time

Maintain Goodwill and Solvency–
  • It is important that the business maintains a good image of the company.
  • The investments of the investors should be used very carefully and it must be ensured that the business maintains its solvency

Responsibility towards Government:

Payment of Taxes–

  • The business should make payment of all the taxes in a timely manner
  • The business should not indulge in evasion of tax as tax helps government to provide better facilities in the country

Follow Laws–
  • The business should follow all the rules and regulations laid down by the government
  • The business should be conducted in a lawful manner

Political Stability–
  • The business must assist the government in maintaining political stability
  • The economic growth of the country requires political stability
  • The business should not support anyone who is creating a political disturbance

Earning Foreign Exchange–
  • The business should try to earn foreign exchange by exporting their goods to foreign countries.
  • All the rules and regulations with respect to export, import, and foreign exchange must be strictly followed.

Support Socioeconomic Programs-
  • The business should support the government in the implementation of programs designed to increase literacy, the creation of jobs etc.
  • The support can be financial or non-financial. Nonfinancial support includes supporting the government by giving expert guidance, latest technical know-how etc.

Miscellaneous–
  • Help government in case of natural calamities
  • Help government by providing expert advice for framing rules and regulations.
  • Should not try to gain unfair advantage by bribing any government officials

Responsibility towards Consumers: 

Quality Products–

  • A Business Enterprise should always provide good quality products and services.
  • The goods should match the quality standards laid down by the government

Consumer Safety–
  • The products of the company must be safe to use
  • Unsafe goods should not be sold in the market 

Reasonable Price–
  • Every company should sell its goods at a fair price
  • Maximum Retail Price (MRP) should be mentioned on all the products

Complete Information–
  • Every company should ensure that accurate information is provided on the packaging of all the products.
  • Such information includes instructions for usage, its ingredients, date of manufacturing etc.

Advertising Ethics–
  • A company should not make any false claims/promises in the advertisements
  • Advertisements should not be misleading or vulgar

Hear Complaints–
  • Every company should pay proper attention to complaints/grievances of the consumers
  • The company should make sure that all the complaints are resolved satisfactorily

Miscellaneous–
  • Every company should provide good after sales services.
  • No company should indulge in acts like creating artificial scarcity of the goods in the market to exploit the consumers

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