External environment and social responsibilities

Abstract

A big influence on internal business environment is the external environment. No business can choose to ignore the outside factors, if it aims to succeed in the today's corporate world. Corporate culture should embody what it takes to succeed in the environment. If the external environment requires the strict following of rules in a particular country, then the businesses are bound to follow these rules, otherwise they will be forced to shut down, according to the laws of the company. We can further subdivide this external environment into various categories.

These include social, political, economical and technological. These factors can make or break a business. In simple words the outside environments consists of stakeholders. A stakeholder is any group within or outside the organization that has a stake in the organization's performance. External environment mainly consists of people who have stakes in the activities of the business such as the government, local population, pressure groups and investors. To illustrate how these people are affected by the organization's activities, let's look at some examples:
Government will look at whether the business is indulging in legal activities or not?

Local Population will look at the price of the good and to see that the business is not producing any good that is detrimental to their religion and social norms. Pressure groups will look at the technology and will seek more employment of labor than machines.