Legal Regulatory Framework For Organizations: Research And Analysis

Selected area/legal issue involving research, discussion, appraisal and analysis of the law, legal risk and need for reform.

Managing the Legal Environment

The subject concerns the legal regulatory framework required by organizations in their day in day out activities. It entails various objectives such as how to apply the relevant legal environment knowledge to arising situations, being aware of the existing legal issues and coming up with strategies to effectively respond to the existing risks, (Boutilier  & Thomson 2011).It also, advocates for the promotion of research writing skills that can play an effective role evaluating legal information and further looks into existing theories in relation to organizations.

In regards to the summary of the topics tackled, topic one concerned how to manage the legal environment in which the definition was outlined, theories in regards to the regulating and enforcing environmental laws were discussed and further research into the provisions of the law looked into, (Magness 2008).

The 2^nd topic looked into the theory of governance, its various structures and who bears the responsibilities and liabilities, the opportunities available and threats that exist in it

The 3^rd topic was in regards to how the various legal relationships should be managed, which include: special contracts such as those of employment or agency and its associated risks where factors vitiating a contract such as offer and those that can result to breach such as mistake & misrepresentation were outlined with relevant case laws such as Carlill vs. Carbolic Smokeball.

Regarding the 4^th week, various obligations arising from the legal environment were discussed more so the obligation in regards to torts, issues around it and the implications it brings about.

In the 5^th week, a response of the organization towards various challenges was looked into, such as global challenges i.e. those faced worldwide while local ones are those of a specific state. In addition, possible risks were also looked into and further ways to come up with strategies in response to the risks via decision making were discussed, (Ansell & Gash 2008).  

The Australian wheat board case (1999-2005)

The case concerned one of the white collar form of crimes i.e. bribery which was reported as one of the biggest international case. The company transformed from being run as a public corporation to a private entity following the occurrence of the events below: The Company was the biggest supplier of humanitarian goods under OFFP which existed as from late 1996 -2003, (Rogers 2008). During the period it got over 2 billion US dollars from BNP account through selling over 6m tones of wheat to Iraq in which it paid over $ 2m illegal fee to Iraq that later become responsible for the inland transportation of its humanitarian goods but due to privatization the terms had to be changed, (James & Wooten 2010).  Following this, the major trends were in regards to requests for tender by IGB including illegal fees, contracts between IGB & AWB including illicit fees, requests for added fees outside of the OFFP & AWB complying to pay the illicit fees. Based on the investigation it was apparent that AWB committed unacceptable act of paying unlawful fees, thus making the corporation a motivated lawbreaker and by signing the contracts it made itself a motivated wrongdoer and appropriate target, (Wang  & Pizam 2011).

Theory of Governance and Responsibility

The case concerned an allegation that VW, Audi and Skoda took part in misleading and deceptive conduct in Australia, where it was discovered that most Volkswagen cars sold in the us were fitted with a particular software made to evade pollution controls and that almost one hundred thousand Australians owned Volkswagen that had been affected by the software. Despite the existence of various emails and letters referred to by the legal representatives of the Australian competition and consumer commission where Audi and VW companies had admitted to the regulators and their customers that their emission software was not in line with the Australian laws they still argued that they didn’t have a case to answer since the approval of affected cars came from Europe before their exportation to Australia

The company is one of the biggest owned private waste management corporations in Australia that provides sanitary, recycling and green collection of waste services. It was the first case in which the ACCC enforced in regards to the new laws that were put in place to protect small businesses form unfair contract terms. As per the consumer laws in Australia any terms result to imbalance of power between the entities don’t serve to protect their interests and that which can cause financial detriment to small business if relied on, are unfair and void. Therefore in the case, the federal court found the eight terms of contract by JJ Richards Company, used in transacting small businesses were unfair and therefore declared void.

The case also known as the deep-water horizon oil spill or BP oil spill an industrial disaster that began in the year 2010 in the gulf of Mexico after being brought forward by Sinaloa Class Actions which is an entity made up of lawyers specialized in environmental matters, according to them, during the occurrence of the disaster, oil reached shores of Mexico and therefore interfering with hundreds of people in the surrounding that relied on fishing and tourism for sustainment. Later it accepted to compensate the damage in us

In looking at this theory it’s important to consider the key definition of a ‘stakeholder’ which refers to any person or group who has impact or can be affected by the operation of an organization. Such include: shareholders, employees, suppliers, customers and the community at large. On the other hand, generally the theory idea entails what the organization should be and how it should be conceptualized. Ackermann & Eden (2011) is of the idea that the entity should be taken as a group of stakeholders whose role should be to manage their interests, needs and viewpoints, (Jones 2015). Further, the definition is always a subject of debate in literature which has resulted to recent definitions such as; they are groups who play a significant role in the continuity and success of the business

Further, the theory is looked at in various ways i.e. the normative way in literature, the descriptive way and the instrumental stakeholder theory all concerning how managers should conduct themselves and the company activities, (Jamal & Stronza 2009).

Managing Legal Relationships

The theory can be looked at as new & old theory of the institution, whereby the old suggests that corporations are bodies that show the values of a society while new suggests that bodies are reflected in corporations. Further, the theory in regards governance is influenced by almost all theories concerning ethics because the expectations of a society are natured and styled by governance. In conclusion therefore, what organizations take part in, how they are managed and what is expected in response to regulation is majorly influenced by institutions.

Risks in the legal sphere arise due the various relationships that exist among the different parties such as parties to a contract, employment and agency relationships. Therefore the legal environment comes up with strategies that help in the regulation of such risks which include: coming up with laws whose sources include the common law and legislations such as acts of parliaments, (Cole 2016). Further, the management may be indirect vs direct or market and non-market. Market involves interactions between corporations and other individuals usually providers while the non-market involves the social, political & legal arrangements that enable communications in conjunction with, markets and private entities, (Mitchel, Wood & Agle 2017). Issues for management include; protection of the environment, technological regulations, safety & health international exchange policies, corporation responsibilities and ethics.

Further, there exist risk management standards that must be complied with through adhering to the laid out laws, (Alkin, Christie & Vo 2012). Failure to manage the risks it might result to reduction in reputation of the market, reduce market opportunity or result into loss of value.

The topic and the learning outcomes are of much importance more so to organizations as they help them be aware of the existing dangers they are exposed to and be able to develop flexible strategies that can be able to address both global and local challenges.

The agency theory involves two main parties i.e. the principal and his agent where the agent acts on behave of the principal and therefore resulting to liability on the principal as he is bound by the actions of the agent done in course of duty or under the principal’s instructions, (Lan & Heracleous 2010). Further the agent-principal authority arises under any of the following: express where the agent is instructed to act in a certain way; implied authority which can be construed from their conduct; ostensible; ratified and by necessity

References

Ackermann, F., & Eden, C. (2011). Strategic management of stakeholders: Theory and practice. Long range planning, 44(3), 179-196.

Retrieved from https://espace.curtin.edu.au/handle/20.500.11937/19746

Alkin, M. C., Christie, C. A., & Vo, A. T. (2012). Evaluation theory. Evaluation roots: A wider perspective of theorists’ views and influences, 386.

Retrieved from journals.sfu.ca/jmde/index.php/jmde_1/article/download/348/34

Ansell, C., & Gash, A. (2008). Collaborative governance in theory and practice. Journal of public administration research and theory, 18(4), 543-571.

Retrieved from https://academic.oup.com/jpart/article-abstract/18/4/543/1090370

Boutilier, R. G., & Thomson, I. (2011). Modelling and measuring the social license to operate: fruits of a dialogue between theory and practice. Social Licence, 1779-96.

Retrieved from  https://socialicense.com/.../Modelling%20and%20Measuring%20the%20SLO.pdf

Cole, T.R. (2016). “Report of the inquiry into certain Australian companies in relation to the UN Oil for Food Program. Retrieved from https://trove.nla.gov.au/work/25714701

Jamal, T., & Stronza, A. (2009). Collaboration theory and tourism practice in protected areas: Stakeholders, structuring and sustainability. Journal of Sustainable tourism, 17(2), 169-189. Retrieved from  https://www.tandfonline.com/doi/abs/10.1080/09669580802495741

James, E. H., & Wooten, L. P. (2010). Leading under pressure: From surviving to thriving before, during, and after a crisis. New York, NY: Routledge. Retrieved from  https://www.amazon.com/Leading-Under-Pressure-Surviving-Thriving/dp/1841697915

Jones, T.M. (2015). ‘Instrumental Stakeholders Theory: A Synthesis of Ethics and Economics.’ Academy of management review

Lan, L. L., & Heracleous, L. (2010). Rethinking agency theory: The view from law. Academy of management review, 35(2), 294-314. Retrieved from  https://www.tib.eu/en/search/id/.../Rethinking-Agency-Theory-The-View-from-Law/

Magness, V. (2008). Who are the stakeholders now? An empirical examination of the Mitchell, Agle, and Wood theory of stakeholder salience. Journal of business ethics, 83(2), 177-192.

Mitchel .R.K,  Wood, B.R.&Agle (2017). Towards a Theory of Stakeholders Identification and Silence: Defining the Principle of Who and What Really Counts, Academy of Management Review. Retrieved from  https://pdfs.semanticscholar.org/6606/e86c38b524890f2f805ef6f20436916f2884.pdf

Rogers, P. J. (2008). Using programme theory to evaluate complicated and complex aspects of interventions. Evaluation, 14(1), 29-48.

Wang, Y., & Pizam, A. (Eds.). (2011). Destination marketing and management: Theories and applications. Cabi.