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FOUR MODELS OF THE BGS RELATIONSHIP Interactions among business, government, and society are infinite and their mean- ing is open to interpretation. Faced with this complexity, many people use simple mental models to impose order and meaning on what they observe. These models are like prisms, each having a different refractive quality, each giving the

Management: Tasks-Responsibilities-Practices (New York: Harper & Row, 1973), p. 40. 19 For discussion of this distinction see Jean J. Boddewyn, “Understanding and Advancing the Concept of ‘Nonmarket,’” Business & Society, September 2003. 20 In re: the Exxon Valdez, 270 F.3rd 1238 (2001). ste12672_ch01_001-021.indd Page 7 4/4/11 7:36 PM user-f501ste12672_ch01_001-021.indd Page 7 4/4/11 7:36 PM user-f501

WHY IS THE BGS FIELD IMPORTANT TO MANAGERS? To succeed in meeting its objectives, a business must be responsive to both its eco- nomic and its noneconomic environment. 19 ExxonMobil, for example, must effi- ciently discover, refine, transport, and market energy. Yet swift response to market forces is not always enough. There are powerful nonmarket

How Institutions Support Markets CORPORATIONS Combine capital and labor, encourage risk by limiting liability, and have continuity beyond individual lives. THE MARKET JUDICIAL Protect property rights, encourage investment by making dispute resolution predictable. REGULATORY Protect the public and investors from dishonesty, danger, and fraud. CULTURAL Impart values, habits, and norms in family, religious, or educational

WHAT IS THE BUSINESS–GOVERNMENT–SOCIETY FIELD? In the universe of human endeavor, we can distinguish subdivisions of economic, political, and social activity—that is, business, government, and society—in every civilization throughout time. Interplay among these activities creates an environ- ment in which businesses operate. The business-government-society (BGS) field is the study of this environment and its importance

The Study of Business, Government, and Society of New Jersey continued to exist. Although it had shed 57 percent of its assets to create the new firms, it was still the world’s largest oil company. Some companies formed in the breakup were Standard Oil of Indiana (later renamed Amoco), Atlantic Refining (ARCO), Standard Oil of

The Study of Business, Government, and Society Snowmobile Corporation ExxonMobil is a colossus. In 2010 it had revenues of $370 billion and net income of $29 billion. To put this in perspective, it had five times the sales of Microsoft; its profits equaled the total sales of Nike. It paid $89 billion in taxes, a