Business Ethics and Corporate Governance, Second Edition

REGULATORY ROLE

A large part of the economy of even most of non-centrally planned countries is regulated by the government, as discussed below:

1. Government may determine the conditions under which persons or corporations may enter certain lines of business as in the granting of a charter, a franchise, a licence, or permitting any ‘person’ to use public facilities or resources.
2. Government may regulate or assist the conduct of economic ventures of various types once they are under way.
3. Public control may extend to the results of business operations as in the limitation of public utility profits, ceiling on dividends and imposition of excess-profit taxes on business, etc.
4. Government may control the relationship between various segments of the economy, ...