India has improved significantly in terms of ease of doing business through various reforms and improving the orderly legal environment in the economy. The administrative wing of government is also an integral part of the legal environment, as it promulgates laws, rules and regulations. Environmental audits are used to assess the impact of business activities on the environment against established criteria or standards. An environmental audit helps to: The legal environment determines how a particular country`s business activities can thrive or be limited by the country`s laws. It also influences the estimate of the economic useful life of an intangible asset. An appropriate legal environment is responsible for the success of a business ecosystem. In the right legal environment, a company can reach its real break-even point. Foreign investors are also attracted in a reasonable legal environment. The components of the legal environment and its impact on each business are explained in more detail in this article.
The legal environment of a business indicates a dual objective set by the government that helps the business to thrive, which benefits citizens either through job creation or through a service. In negative connotations, the legal environment, especially in socialist or mixed economies, can limit or hinder business growth. To properly run a business in India, a basic knowledge of the Companies Act, 2013; Industries (Development and Regulation) Act 1951; Exchange Management Act 1999; Factories Act, 1948; Trade Unions Act; 1926; Workers` Compensation Act, 1923; The Competition Act, 2002 and other laws amended or repealed by Parliament from time to time are necessary, among others. Strict environmental laws can force companies to change their operations and business activities or move to another location where environmental regulations are less stringent. However, there is a double effect of these environmental laws in companies, as companies could be swept away by less stringent laws. The government, through its contractual rules and procedures, dictates how companies work with them. Not only does it actively encourage small businesses to get involved in purchasing products and services, but it also goes to great lengths and spends a lot of money on outreach programs to find well-qualified small businesses as suppliers to avoid legal factors that would impact their business. Many countries have enacted their own environmental protection laws. How these affect the business depends on the type and nature of the business.
Some businesses may also need a license and authorization from the government. India`s economic liberalization in 1991 is the perfect example of how an appropriate legal environment helps businesses grow and prosper. Liberalization and globalization, even after some negative effects, in the 90s helped India a lot in this regard. Environmental protection laws are formulated to protect environmental degradation from illegal human activities. Environmental regulations have a direct or indirect impact on businesses. On the other hand, it also ensures that the environment is not affected by the company. An appropriate legal environment for a business helps a business ecosystem thrive. Alternatively, a strict legal environment can also hinder business activities. Intellectual property law deals with laws aimed at securing and enforcing legal rights in inventions, designs and artistic works.
The Intellectual Property Act provides the opportunity to protect a company`s unique ideas and inventions so that no one but the creator or owner can imitate or produce them. Therefore, it helps to recognize the hard work behind innovation and competitive advantage. Intellectual property is particularly important when branding and promoting a product. Trademark, copyright and patent laws fall under the category of intellectual property rights. Strict environmental laws can force business organizations to change their business operations and activities or move to another location with less stringent environmental regulations. However, there is a double effect of these environmental laws in companies, as companies could be swept away by less stringent laws. The advantages of studying the legal environment of a company are: (Hons) at Kolkata University. This article provides a comprehensive overview of the legal environment, as well as the classifications and impact of the legal environment on the business, and how the legal environment can affect each business. India is the first country to mandate environmental audits in industrial facilities.