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Unit 5: Political and Economic Environment

understanding and complying with central regulatory agencies will minimize their chance of notes
fines, prosecution, or other regulatory action. Therefore, it is in the best interest of businesses to
maintain healthy relationships with regulatory agencies at all levels of government. Among the
business activities regulated by government are competitive practices, industry-specific activities,
general issues of concern, and monetary regulations.

5.3.1 central communications commission (ccc)

The CCC monitors and regulates CB radio, radio, telegraph, telephone, and television operations.
It has broad powers to set acceptable standards for television regarding language, nudity,
violence, or other material that may be perceived as inappropriate by the general public. For
example, television shows that are adult-oriented or contain violence are typically on late in
the evening so that children are less likely to see them. In addition, television shows often warn
viewers about their content through a rating system; since the rating is displayed on the screen,
viewers can make an informed decision before watching a particular program.
The CCC also has the power to fine broadcast companies that use inappropriate language in their
programming. Since most television and radio stations know what are considered acceptable
standards, fines are rarely issued. When fines are issued, however, a television or radio station
may take the FTC to Supreme Court to appeal the decision. Broadcast companies that fight the
CCC over a show’s content normally argue that the First Amendment gives them the right to
broadcast the contested material.

5.3.2 food and Drug administration (fDa)

The FDA is responsible for ensuring the safety of cosmetics, drugs, and food. One of the most
important functions of the agency is new drug approval. The FDA requires pharmaceutical
companies to provide detailed scientific data regarding new drugs prior to approval. Specifically,
the FDA will review the potential benefits and negative side effects of all proposed drugs. The
agency reviews the information submitted by the pharmaceutical company and may also conduct
its own tests if additional study is deemed needed. The FDA is extremely important to the
business community because if it rejects a new drug, the pharmaceutical company developing
it cannot sell it. FDA regulators must balance the interests of the general public with those of
the pharmaceutical company. The FDA does not endorse new drugs; rather, it approves them,
stating that they are thought to be safe.

5.3.3 equal employment opportunity commission (eeoc)

The Civil Rights Act of 1964 prohibits discrimination on the basis of race, colour, creed, sex, or
national origin. This law applies to almost every private company, non-profit organization, and
government employer, although some exceptions were granted to religious corporations, Indian
tribes, and private-membership clubs. The Civil Rights Act also created the Equal Employment
Opportunity Commission.

5.3.4 occupational safety and Health administration (osHa)

Enacted in 1970, the Occupational Safety and Health Administration, was designed to ensure
safe and healthy working conditions in nearly every environment. OSHA’s basic premise is that
employers must provide a work environment that is safe and free from hazards that may cause
harm or death to their employees. In addition, employers are obligated to follow occupational
safety and health standards that are ordered by the secretary of labor (OSHA falls under this
department). Employers are given written guidelines so they know specific OSHA rules and
regulations.

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