Globalization means increasing integration of economies and countries through:
In simple words: businesses operate in a world market, not only a local market.
Common features:
The WTO (World Trade Organization) is an international organization that deals with the rules of trade between nations.
An MNC (Multinational Corporation) is a company that operates in more than one country through subsidiaries/branches.
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Definition of Business Environment is sum or collection of all internal and external factors such as employees, customers needs and expectations, supply and demand, management, clients, suppliers, owners, activities by government, innovation in technology, social trends, market trends, economic changes, etc.
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Globalization means increasing integration of economies and countries through:
In simple words: businesses operate in a world market, not only a local market.
Common features:
The WTO (World Trade Organization) is an international organization that deals with the rules of trade between nations.
An MNC (Multinational Corporation) is a company that operates in more than one country through subsidiaries/branches.
FDI (Foreign Direct Investment) is investment by a foreign entity in a business in another country with the intention of long-term control/management.
Business ethics are moral principles and standards that guide business behaviour.
Ethical businesses build long-term trust with customers, employees, investors and society.
CSR (Corporate Social Responsibility) means a business voluntarily contributes to society’s welfare and sustainable development beyond profit.
Examples:
Sustainability means meeting present needs without harming the ability of future generations to meet their needs.
Sustainable business balances all three.
Common ethical issues:
Good practice: firms should maintain ethical standards globally, not just where laws are strict.
Business ethics → Responsible decisions → CSR activities → Sustainability (People + Planet + Profit)
From this topic
Features (any three):
These features integrate markets at a global level.
Merits (any three):
Demerit (any one):
Globalization expands cross-border trade and investment. MNCs are key players in globalization, and FDI is a major way through which MNCs enter and expand in other countries.
Globalization → Cross-border markets open
↓
MNC expansion → FDI (new plants / acquisition / JV)
↓
Technology + capital + jobs + competition in host country
Thus, globalization increases MNC activity and FDI inflows, impacting the host economy and business environment.