The Functions and Role of Law in Business and Society
LAW/421

The Functions and Role of Law in Business and Society
The functions and role of law in business and society is to maintain order and decency to the effect of creating an environment that is reasonable, just and productive according to the cultural perspectives of the society in which they are implemented (Scheb&Scheb, 2011; Quirk, Seddon& Smith, 2010). Without law to control the actions of those that are either unscrupulous or simply not mentally capable of understanding or differentiating between right and wrong – society would be chaotic. An excellent example of this would be where there were no controls whatsoever over the stock market and family and friends were able to freely access the material inside information of the corporations their associates worked for. This would clearly lead to an environment where virtually only the very privileged few were able to profit from stock market trades in any significant way. It would also ultimately lead to a far less lucrative market when those who were not privileged simply fell out of the market altogether due to lack of opportunity to benefit from their participation, which dropping out would very likely lead to a severe global recession.
In addition to regulating and setting standards for behavior within a society, laws also regulate and set standards for how business should be conducted. Business laws set the ethical standard and expectations for businesses by defining which business practices are ethical and which are unethical. For example, an employee taking credit for another employees work is an example of unethical behavior within the business environment. It is also necessary to establish certain laws that support the general concept of decency. For example, it is considered necessary, in a city environment, to prohibit