Daily Archives: October 29, 2008

about business social responsibilities

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As an individual living in a cohesive society, every citizen has certain social responsibilities to boot. Business houses too are parts of society and naturally they too are necessarily bound by certain commitments and responsibilities to the society.

Let us take one by one, an individual’s responsibility towards society and compare it with a corresponding responsibility of a business house.

WAY OF MAKING MONEY

An individual should earn his living by certain acceptable means which are not detrimental to the welfare of the society. (Eg. Not being a drug peddler, a pick-pocket/ thief)

A business house should not make its profits by producing goods or by rendering services that are detrimental to the welfare of the society. (e.g. A company producing spurious medicines, or a business house engaged in supplying arms and ammunition to terrorists, a grocery shop selling adulterated food items – these are not acceptable to social norms)

CONCERN FOR OTHERS’ WELFARE

An individual should not behave in such a way to create nuisance or trouble to the society (e.g. dumping garbage on the roads, indecent behavior in public places, producing noise – like playing loud music through blaring loudspeakers) etc.

A business house should not let out their wastes that lead to atmospheric, water and soil pollution. A factory/ workshop should not produce too much of noise that cause disturbance to the workforce and surroundings.

PAYING TAXES

In individual should be a honest tax payer (income tax, professional tax etc).

Likewise, the business house should pay its taxes and duties to the Government (sales tax, import duties, service tax, VAT etc as applicable in the country) as stipulated in the law by maintaining proper accounts and not resorting to any dubious means of tax evasion.

ABIDING BY THE LAW:

An individual should respect and obey rules of laws – rules related to driving, payment of taxes, construction of residential buildings, payment of rentals, loans etc.

Business too should be run within the confines of the rules, regulations and laws related to registration, location of business activity, collection and payment of taxes, pollution control, labor relations, mercantile laws etc.

RESPONSIBILITY TOWARDS DEPENDENTS:

Every individual has his responsibility to take care of parents (providing physical and financial support at old age), extending a helping hand to needy relatives in the family etc. Every one has the responsibility of bringing up their children – providing food clothing and shelter with loving care, providing education and help them grow up as responsible citizens.

- ensuring reasonable returns on investment to investors/ share holders

- prompt repayment of loans to financial institutions

- paying salaries and ensuring social security to its employees

- providing care and comforts to the employees at workplace and meeting statutory requirements like holidays, maternity leave, sick leave, over-time payment etc.

- payment of taxes to the government

- providing quality goods and services to the customers for their money’s worth
etc.

RESPECTING OTHERS’ RIGHTS

As an individual no one should bulldoze others’ legitimate means of survival by acting out of utter selfishness or arrogance.

Likewise, a business house should not try to sniff out competition by monopolizing the business; it should not engage in unlawful activities (e.g. employing child labor) for maximizing profits.

A business is not just a money-making entity in the society. It has a very responsible role to play in the welfare of society irrespective of whether it is bound by statute or otherwise.

Manage our market crash

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Do you know the proverb “After rain comes sunshine”? As the proverb indicates, the sun will always appear once the rain stops; just like the weather, the stock market also goes through cycles. Stocks are always rising and dropping and a market crash can happen several times during your life. If you relate the stocks to this proverb you will understand the value of stocks will rise again after a market crash.

Understanding how to survive a market crash is the basics of a good investment strategy. This includes diversifying your stocks and buying on a regular basis. If you have a specific plan when you buy for a certain amount in stocks or mutual funds whether you invest every month or once a year you will notice that sometimes you buy on a low price and other times on a high price. Spreading your investments out is the best way to survive a market crash because stocks are investments for the long term.

A market crash also gives a lot of opportunities to invest in stocks. This time can be a great time to invest in 401 (K) plans or pension funds because you can buy more shares for the same money and this will give you more profit on the long term. You can better limit your investments in these plans in times when the shares are always rising and are reaching a value which can be considered as “overvalued”. Losing money never feels good but after a period of dropping or a market crash the value of the shares will rise again.

Almost everyone has heard of the greatest crash in history in 1929. The Wall Street stock market crash took place on the 29th of October 1929. Economists considered investing in stocks as a safe investment and many people were buying shares. The value of the shares increased terribly fast and could not be conform to the growth of the world economy. During the period of 1921 until 1929 the Dow Jones; which you can consider as the indicator of the world economy, increased from 60 to 400. You will certainly understand the stock market was overheated and many people became rich during this period.

Manage our mortgage loan

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Choosing or determining the mortgage loans to apply for depends on your financial status, your time, and distance or location you are trying to get the house. And sometimes your taste or favouring of some heard about or beneficial mortgages might determine how to choose and apply a mortgage.

if we don’t have any credit rating or maybe we have bad credit reputation, we need to learn how to use bad credit financing.

Some lenders generally don’t offer bad credit secured loans. Even with the collateral, they consider them to be in too much risk. Here, one may increase the chances of getting approved by applying for a secured loan or by reducing his loan amount. The credit history of that person will also be checked while applying for a loan so lenders can assess his credit rating. This is one of the most important factors for lenders to consider when deciding whether to offer a deal. Having a bad credit rating does not mean the person is a financial failure, but the fact is that; missing payments on other loans against him is a guaranteed way onto the credit blacklist.

But even a most improbable person could have a bad credit rating. A person might be too young, or just may not have had any form of credit before. If the loan application is accepted the person will be given a sum of money, which he will usually have to pay back in monthly installments over an agreed period of time.

if we don’t want to have loans with bad credit, we need more time to improving our credit scores.

If enough time is there before applying for the loan, one should try to improve his credit score if possible. Simply reducing the usage of credit cards in the month prior to taking out a loan can help in this regard, as long as the person continues making payments as normal. If his credit score is low, most lenders will only offer him high interest loans. Thus, not only he will be making higher monthly payments, but the loan will also cost him significantly more in the long run. Even getting the credit score up by only a few points can be worthwhile. In fact, the credit score plays a vital role in the bad credit loans. One must try to improve his credit score.