CHAPTER ONE
INTRODUCTION
- Background to the study
Government, Business and Society interrelationships and responsibilities to each other. Various views exist on the relationship that exists between business, government and society and the expectations from each by the other. Post, Lawrence and Weber (1999) posit that businesses exist primarily to provide good standards of service and products o the society as well as conform to basic societal rules, norms or values. Other responsibilities include obeying the laws laid down by government to guide or regulate their activities as well as, paying taxes to government.
This is to say, Government, business and society exist as a continuous symbiotic interactive system where, each has rights and owes responsibilities to the other two and all are highly dependent on each other for continued existence and relevance. Businesses like all living beings interact with other forces around them and their actions have effects on society and government; just as government actions have on Businesses and society. Both of them in their different ways interact with, affect and are also affected and influenced by the larger Societies in which they exist.
According to Blugh (2010), every legitimate government derives its power from the people (the Society) it governs. He further argues based on the Constitution of the United States of America that, the legitimate grounds for a government’s existence hinges on mutual defense of rights and mutual decision by deliberative assembly. They in turn therefore, owe the society/public a responsibility to protect them from unethical practices of some businesses by enacting government regulations to that effect; they protect the environment, human rights and other social interests. This they try to do through the different ways or control machineries and government agencies they employ. The government here can either be at the Local, State, or Federal levels.
The government responsibility however does not start and end with the society. It owes businesses also, the responsibility of providing a favourable environment for them to thrive in – peace, security and “fair” laws and taxes. In the words of Olebune (2007), “In any government-business relations, the question is, how can the government create an environment in which businesses are naturally motivated to make the right long-term investment decision choices?” This means the government has to put in place the right regulatory and legal framework to guide growth of all industries in the business area. In essence, the government is responsible for protecting the rights of both businesses and society such that the quest of self-interest by either party would not have adverse effects on the other.
Some businesses in a bid to remain in business and continually make profit, engage in some unscrupulous practices which are detrimental to their host environments, represented by the consumers. These are the main stakeholders in every business. The customers or consumers are the major stakeholders in any business organization, and they represent a very large proportion of the society. Stakeholders are defined in Post et al. (1999), as all the people and groups affected by, or that can affect an organization’s decisions, policies and operations.
Businesses therefore owe them a duty to behave in a communally responsible and approachable manner towards them. When a business organization fails in this respect, the customer has a right to register his or her displeasure through complaints.
Consumer complaints should be recognized by an organization and the government as a part of business, because they have beneficial effects for the organization and its products. It is a kind of control measure by which businesses and organizations are made to realize where they have fallen short of customer expectations and see the need to restore consumer confidence in them and their products (Ayozie, 2013). This study is aimed at examining how efficiently a government regulatory agency in Nigeria, The National Agency for Food and Drugs Administration and Control (NAFDAC) is fulfilling its purpose of regulating businesses and protecting consumers.
1.2. Statement of the Problem
Blugh (2010) posits that every legitimate government derives its power from the people, therefore its existence centres on mutual defense of rights and mutual decision by purposeful association. This means, since they were put in place by the people, they in turn owe the society/public responsibilities which includes, protecting them from unethical practices of some businesses by enacting government regulations to that effect.
Olebune (2007) agrees with this position when he argued that the government has to put in place the right regulatory and legal framework to guide growth of all industries in the business area. In essence, the government is responsible for protecting the rights of both businesses and society such that the quest of self-interest by either party would not have adverse effects on the other, through regulations.
The Organization for Economic Cooperation and Development (OECD, 2010) defined Regulation as any instrument by which governments, their subsidiary bodies, and supranational bodies (such as the European Union or the World Trade Organization) set requirements on citizens and businesses that have legal force. The main aim of regulatory policies is to guarantee that the regulatory control works efficiently, so that regulations and regulatory structures are in the public interest. The organization also believes that these regulations and structures should address happenings in the private sector, as well as the public establishments and government agencies. This is because they are important in determining what happens in the economy and the society at large. To achieve this, structures must be put in place by the government to assess conformity or adherence to laid-down regulations. Also, attention should be paid to consumers’ needs and complaints to protect them from unethical practices of business organizations (OECD, 2010).
In Nigeria however, according to Ekanem (2011), the prevalence of fake, substandard, defective and adulterated products is alarming. The quality of services and goods rendered or available to the consumer leaves much to be desired as they are below the regulated standards. In addition, a report by NAFDAC in 2003 stated that the problem of adulterated and fake drugs was so bad that, neighboring countries such as Ghana and Sierra Leone officially banned the sale of drugs, foods and beverages products made in Nigeria (NAFDAC, 2003).
Nwaizugbo and Ogbunankwor (2013), posit that it is doubtful if regulatory agencies set up by government are achieving the mandate for which they were set up. They argue that records in Nigeria show that, consumers do not still know their rights and some who do are unaware of the particular agency to complain to. In addition, it is believed that some of these agencies are ill-equipped to provide adequate surveillance in eradicating fake and substandard products from Nigerian markets. As a result, studies by Alabi, 1996; UNODCCP, 1999; Mambula, 2002; Daily Independent, 2010 (in Nwaizugbo and Ogbunankwor, 2013) concluded that Nigerian consumers are the most abused in Africa.