What role(s) does business play in politics, and what challenges and Essay

What role(s) does business play in politics, and what challenges and opportunities does this raise for effective and democratic governance - Essay Example In the light of globalization, global governance has emerged as a multilateral and poly centric process to define and implement global rules. In global governance, the corporate play active roles to address social and environmental issues and other concerns that are experienced all across the globe. Discussion Are firm’s economic or political actors? Whether firms are economic or political actors has become a debatable topic with the advent of globalization. The argument on the relationship between business and politics is based on the assumption of a regulatory environment, where in the public concern issues are addressed by the nation state level institutions. The nation state institutions also regulate the business behaviour in the country. The state institutions are therefore, the only political institutions that work for ensuring the well-being of the society. In contrast, business firms are generally considered as economic actors. Business firms use their political and l obbying strategies to influence the political system. Also, they take up corporate philanthropy as a part of their strategies. But these activities do not establish them as political actors that operate with the aim of addressing public concerns. Instead these activities of the business firm in the political sphere are more aimed at boosting their economic ends. However, over the last decade, the separations between the economic and political spheres have become blurred. With the advent of globalization, the national context of governance started losing its foothold. It was observed in many cases that the state system did not succeed in dealing with the transnational social and environmental issues, administering the rights of citizenship, regulating the economy, serving the interest of the public and in providing necessary public goods. These incidents of failure were seen many times worldwide due to the lack of proper enforcement mechanisms and the lack of essential resources. In these situations, often the private business firms intervened and filled in the void through their voluntary activities. In the current scenario, a number of multinational businesses have implemented voluntary regulation of activities and production of public goods. The companies have taken up responsibilities that were once into the foray of the government bodies only. The firms have started contribution to public education, health, protection of human rights, social security with the objective of filling up the gaps in the legal regulation processes and promoting stability and peace in the societies. Thus, now the businesses are operating as social entrepreneurs who serve public interest with the use of the resources in the business thus creating a distinct change in the political ideology throughout the world. Is the pursuit of corporate non-market/political strategy unethical? Although, the concept of a business firm occasionally taking up political activities is accepted with a broad consensus, yet a business actually being a strong political actor itself other than the governments still draws very less appreciation. The changing image of the firms from economic to political actors in global political scenario is highly contested. This is because this change challenges the existing theory of the role of business firms as economic actors in the society (Yves 351). Also, another reason is that this has caused the rise of substantial concerns about the impact of this change on democracy and public response all over the world. Internationally, only the states are known to have voting rights but international organizations often invite business firms to give their inputs in the