TABLE OF CONTENTS Business activity takes place locally, within countries, across borders and internationally. It is inevitable that governments will be involved in some way. Markets are globalizing for many products and services because governments around the world are taking action to remove barriers to trade. Understanding the basics of political systems, institutions and processes provides greater opportunities for organizations to align themselves, and thus provide greater opportunities for achieving business objectives.
A good question for audit practitioners reading this book is What is politics? An attempt is made to answer that question from that perspective.
The style and nature of any country s political system will tend to be underpinned by its historical and social values, national identity and political philosophies. Revolutions come and go but political evolution is the norm incremental, rather than radical particularly in democratic countries. This tends to bring some degree of stability to the business environment, particularly in developed countries.
The two extremes of political systems are:
totalitarian
democratic.
Arising from the power of monarchy, from military conquest (sometimes called a junta ), or a free election, a totalitarian government will tend to act in order to restrict or prohibit political participation by others. The style of government tends to be a rigid enforcement of rules and oppression of opposition.
Exemplified by free and fair regular elections, and freedoms of speech and media, democratic systems provide more balanced governments where matters are discussed,...
