Business Makers

Some people criticize the concept of social responsibility. They put forward the following arguments to oppose the assumption of social responsibilities by businessmen.

Dilution of Business Goals: If a business firm involves it in social activities, its economic goals might get diluted. Its positing in the market place might be weakened. As a result it may accomplish poorly in both its economic social goals. Society will lose when productivity of business declines. The economic role of business in society would also become confused.

Lack of Social Skill: Generally businessmen lack the perception a skill required for effective handling of social problems. Their outlook is primarily economic and they do not feel comfortable with social mattes. Their mental make up is suited for handling business matters only.

Rise in Prices: Social involvement of business requires financial expenditure. Unless the government or social institution bear the costs, business is likely to pass his cost on to consumers by increasing the prices of goods and services.

Lack of Accountability: A business enterprise is responsible mainly to its owners. Involvement of business in social matters will give businessmen more owners. As public has little control over them it swills be difficult to check miscue of this power. If different sections of society are represented in the management of business to ensure accountability, decision-making process would become political and freedom of enterprise would be undermined.

Reeducation in Competitiveness: If business firms are asked to spend considerable money on social activities, their competitive position in international markets may go down.

Lack of Measurement: There are no clear-cut criteria to judge the social performance of a business enterprise. Economic values are the only precise criteria to measure the performance of business. Moreover, business corporations are not more agents.
The arguments given above suffer from tow limitations. First, they require business firms to ignore social demands on them. Business enterprises cannot afford to do so. Business concerns are no longer mere economic institutions. They are also social institutions. Businessmen are trustees of various social groups. Secondly, these arguments overstress the power and influence, which businesses may exercise by assuming social responsibilities.

To decide whether a particular activity is an economic or a non-economic activity the following points should be considered:

The purpose of the activity is the most important ground for deciding whether an activity is economic or non-economic. The same activity may be economic for one purpose and non-economic for another purpose. The chief purpose of an economic activity is to generate income. For example when a lady cooks food for monetary gain it is an economic activity. But if the amen lady cooks food for hers family it is a non economic activity.

when the work done is measurable in terms of money it is an economic activity. For example services of a maid servant can be measured in terms of money and is therefore and economic activity. On the other had services of a housewife cannot no measured in terms of money and is therefore a no economic activity.

In the normal course of life a person desires to earn money in order to satisfy his wants. He seeks to obtain maximum return from his efforts. But work done for emotional reasons is non-economic activity. For example a businessman wants to produce goods at the lowest possible cost to make maximum profit. On the other hand a person engaged in religious or social service is willing to spend bother his money and time.

Both economic and non-economic activities must be legal. Activities which are illegal though resulting in economic gain for example smuggling black-marketing robbery and others cannot bane called economic activities. Only those human activities can be called economic activities which are performed in accordance with the laws of the land. Even non-economic activities whether social or religious must conform to law.

Business refers to the economic activities which are directed towards producing or acquiring wealth through buying and selling of goods and services. Business is carried on by people to earn an income. Generation of income or wealth involves production, sale and exchange of commodities which human beings want. In other words, business is sale and exchange of commodities which human beings want. In other words, business is concerned with that part of production which is actually exchange and results in mutual benefit to both the buyer and the seller. Manufacturing, mining, trading, transportation, banking, insurance and others are examples of business activities.

An activity which requires special knowledge and skill and which is under taken to earn a living within a prescribed code of conduct is called profession. The services of lawyers, chartered accountants, doctors are considered as professions. Person’s who render these services are known as professionals. Members of a profession have their own professional association which exercises statutory control over their activities. Professionals are required to bane embalmers of the statutory control over their activities. Professionals are required to be members’ statutory association.

People who work for others and receive wages or salary in return are said to be in employment. They are know as employees and the persons for whom they work are called employers. There is a relationship of master and servant here. Workers employed in factories, offices, banks, government departments, etc. are in employment. They work as managers, officers, clerks, peons, sweepers, and in various other capacities.

Economic activities or occupations are of three types
Business refers to the economic activities which are directed towards producing or acquiring wealth through buying and selling of goods and services. Business is carried on by people to earn an income. Generation of income or wealth involves production sale and exchange of commodities which human beings want. In other words business is sale and exchange of commodities which human beings want. In other words business is concerned with that part of production which is actually exchange and results in mutual benefit to both the buyer and the seller. Manufacturing mining trading transportation banking insurance and others are examples of business activities.

An activity which requires special knowledge and skill and which is under taken to earn a living within a prescribed code of conduct is called profession. The services of lawyers chartered accountants doctors are considered as professions. Person’s who render these services are known as professionals. Members of a profession have their own professional association which exercises statutory control over their activities. Professionals are required to bane embalmers of the statutory control over their activities. Professionals are required to be members’ statutory association.

People who work for others and receive wages or salary in return are said to be in employment. They are know as employees and the persons for whom they work are called employers. There is a relationship of master and servant here. Workers employed in factories offices banks government departments etc. are in employment. They work as managers officers clerks peons sweepers and in various other capacities.

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Traditionally the role of commercial banks in the field of long-term finance to industry has been negligible. Therefore, the Government has set up a number of special financial institutions in the country to provide long-term finance to business enterprise The IFCI, IDBI, ICICI; Sacs are the main among such financial institutions. The term-lending institutions or development banks have become a major source of fence for flotation o new concerns as well as for the modernization and expansion existing oceans. The supplement other sources of fiancé and fill gaps. They provide fennec Goth in the form of equity and debt. These institutions provide both direct (loans) and indirect (purchase and underwriting of securities) assistance. These institutions re not simply financial institutions. They also provide promotional, technician managerial services. They take initiative on locating and filling gaps in the country’s industrial structure. In addition to well-known development banks in the country, the LIC, General Insurance Corporation, NIDC, NSIC, etc. also help in providing finance to industry.

The main advantages of institutional finance are as follows: (i) both risk as well as loan capital is available. Special financial institutions provide underwriting and direct subscript triton facilities also. (ii) New companies which may find it difficult to raise finance form the public can get finance from these institutions. Assistance is available when recourse to normal sources is impracticable or unprofitable. (iii) As these institutions carry out a thorough investigation before granting assistance to a concern, relationship with them help it increase the creditworthiness of a company. (iv) Loans and guarantees in foreign currency and deferred payment facilities are available for the import of required machinery and Kauai mint. (v) The rate of interest and payment procedures is convenient and economical. Facilities for repayment in easy installments are made available to deserving concerns. (vi) Along with finance, a company can obtain expert advice and guidance for the successful planning and administration of projects.

However, institutional financing may involve him following limitations: (i) the concern requiring fiancée form special financial institutions has tourist itself to a thorough investigation. A number of formalities and documents are involved. (ii) Many deserving concerns may fail to get assistance for want of security and other conditions laid own by these institutions. (iii) Sometimes, these institutions place restrictions on the autonomy o management. They lay down a convertibility clause inland agreements. In seedcases, they insist on the appointment of their nominees on the Board of Directors of the debtor company.

A private company combines the following advantages of partnership and public company

• Large capital: A private company can raise larger financial resources than a partnership.

• Limited Liability: Like a public compan7y, the liability of members in private company is limited to the face value of shares held by them. Unlike a partnership, the risk of members is limited.

• Continuity: A partnership is dissolved on the death, insolvency and lunacy of But a private company like a public company continues to exist irrespective of these events.

• Freedom from Legal Formalities: A private company is free from several legal formalities applicable to a public company. As in the case of partnership, three is flexibility of operations in a privet company.

• Close Supervision and Control: The membership and control of a private company rests with a small group of relatives and friends. Like a partnership, it enjoys benefits of prompt decisions, secrecy and effective control.

Thus, a private company is a mixture of partnership and public company. It enjoys ease of formation, flexibility of operations and personal control which are available in a partnership. At the same time, the main benefits of a public company such as limited liability and stability are available to Privet Company.
Private company enables a small group of persons to control the management without undertaking the risk of unlimited liability. Therefore, it is an ideal form of organization for people who seek personal control of business with the benefit of limited liability. On the others hand, a public company is an ideal form of organization for large scale enterprises like steel, automobiles, computes, etc. because huge capital can be secured form the general public.

The 12-point resolution that the business sector unanimously approved during the recently concluded Mindanao Business Conference in General Santos City indicates that the sector will always be an active partner of the government in developing Mindanao.

ICT as development agent

Truly believing that information and communications technology (ICT) is a catalyst for development, the business sector believes that it is an essential part of the overall roadmap for the island and that sufficient infrastructure facilities must be laid out for connectivity to be enhanced.

In this modern world, connectivity is as important as physical infrastructure because it allows real time interaction between and among players of a certain sector and even between the producer and the market. It has tremendously shrunk the world to just about a line between two people, even if the distance is between the north and south poles.

The cities of Davao, General Santos, Cagayan and Zamboanga are all poised to become the ICT hubs of Mindanao. These are the areas where connectivity is present along with a rich source of human capital to support ICT developments.

Power, power

Another major issue that the business sector raised during the event was finding ways to ensure sufficient and steady power supply in Mindanao.

Reliable power supply will not only lure more investments to the island, but also sustain growth.

It is not only necessary for government to ensure that power investments are placed in areas where needed most (in case of Mindanao it is in the southern part which consumes nearly one-half of the power produced in the island), it is also very important that power is brought to all the points, particularly to areas where development is slow.

We must remember that reliable power, like infrastructure facilities such as roads, is a key to development.

And according to the analysis of government agencies, like the National Power Corp. and the National Transmission Corp., Mindanao will run out of power within the next three years unless major decisions are made today.

It is good that the national government decided to set up the transmission line that will bring the excess power supply produced in the northern part of Mindanao, particularly from the 200-megawatt coal-fired plant in Tagoloan, Misamis Oriental, to the rest of the Mindanao grid.

But it is also necessary that new power plants are built in areas where they are needed. But this can only be done if investments in the sector get the much-needed support from government policy-makers.

Efficient shipping services

Considering that Mindanao is a known producer of agricultural products, it is also important to find ways to bring these to the markets in easier and cheaper ways. It is currently more expensive to bring goods from Mindanao to Manila than to send them abroad.

This only shows two things, good port handling facilities are absent and that freight rates are also higher in the domestic shipping sector.

There have been so many attempts to persuade both the government and the industry to find common ground, both in reducing shipping rates and improving port handling facilities. These moves must be realized soon. Otherwise, business will continue to languish and development will not take off.

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SOURCE Eos Airlines

The term electronic business (e-business) refers to the buying and selling of goods and services online. It comprises on-line shopping, marketing and selling of goods and services over the internet. It involves demonstrating goods on the website, selling or filling orders, conducting transactions and receiving payments.

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E-commerce is a part of E-business which refers to the full breadth of activities comprising a successful internet based enterprise. E-business includes creating a viable business model for assessing where profit can come from, financing the business, putting operating system in place and selling on the internet. E-business represents the sales side of electronic business. For example, Amazon.com started as an online bookstore. But it has now become a complete department store selling all kinds of merchandise online.