Question

what types of regulatory factors, operating in the general environment, are crucial for organizations to comply with?  How do organizations ensure employees comply?  How does attention to compliance in turn impact components of the specific environment... customers, employees, etc.?  Provide specific examples.

Answer 1

Q1) Below are the various types of regulatory factors which are crucial for organizations to comply with -

1. Accounting and financial regulations

2. Environmental regulations

3. Safety regulations

4. Quality regulations

5. Human and labor rights regulations

Q2) Organizations need to create specific policies and practices to ensure the management as well as the employees strictly adhere to the regulations to create goodwill among the stakeholders and avoid fines from the regulatory organizations. Apart from creating policies, the employees need to be made aware of them through awareness and training programs.

Q3) Below is how attention to compliance impacts components of the specific to internal or external environment -

1. From an external environment standpoint, complying with regulations will create a goodwill in the minds of customers thus increasing the purchase of the products of the firm.

2. From an internal environment standpoint, employees feel motivated and proud to work for an organization which complies with all the regulations.

3. Shareholders gain from the increase of sales.