Supporting the global profession
Without business, we wouldn’t have growth, taxes or society. But how should we design and implement the essential rules that guide, encourage or (where necessary) constrain this most vital of activities?
Business is the backbone of modern society which contributes to economic prosperity and raising the standard of living for ordinary people. In order to flourish, business requires an infrastructure which can provide the right conditions for entrepreneurship and for multinational businesses to commit. This report sets out that infrastructure by listing four principles and five enabling mechanisms which provide those right conditions for business.
The intention is for these principles to act as guidance to governments and other authorities engaged in facilitating the right conditions for business. They can also serve as a common denominator for discussions between such authorities, professional advisors and businesses, to reach an understanding on what both parties need from each other to encourage business and economic success as well as social prosperity.
Whilst the principles are not meant to be exhaustive, they will all (to a greater or lesser extent) underpin success. The ACCA Global Forum for Business Law, which has been instrumental in drawing together these principles, will monitor and review the application of the Principles to ensure that the document remains relevant and useful for policymakers and businesses alike.
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ACCA believes there are four key tenets or principals of business law that underpin a good environment for doing business these are:
- Simplicity - the laws that govern businesses should be stringent but not complex.
- Openness and transparency - Lawmakers should be open and transparent with businesses when designing and implementing business law
- Fairness - business law must be applied consistently and equally among business enterprises.
- Accountability - business law should facilitate the accountability of business, fostering trust in businesses.
To ensure that these principles have real meaning in practice, the law must:
- Provide dispute resolution mechanisms
- Provide encouragement for business enterprises
- Support an ethical approach to business
- Maintain stability and confidence
- Enable business to drive society’s prosperity.
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"A common legal framework is fundamental to economic activity and growth. The framework allows trade and business to flourish. Good business law facilitates trade between friends and peers and also between strangers, across long distances and increasingly across national boundaries."
From principles to action
If the principles are to have any meaning in practice then the law must:
Provide dispute resolution mechanisms: disputes between businesses will arise. The way to resolve disputes should be timely, cost-effective and confidential. Although confidentiality is important, a digest of principles and decisions would help others.
Provide encouragement for business enterprise: successful entrepreneurs manage risk sensibly while also being aware of being part of the fabric of a wider community.
Support an ethical approach to business: enterprises should be encouraged to behave ethically commensurate with prevailing cultural sensitivities.
Maintain stability and confidence: governments should instil confidence in markets and financial systems and show it is supportive of business.
Enable business to drive society’s prosperity: business law provides a framework in which business success make a net positive contribution to the wider community.