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Government as a Stakeholder

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Government as a Stakeholder

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  • May 2006
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The need for consumer protection has increased in recent years because of globalisation of world markets. This is because goods and services from around the world can be easily sold in other countries. For example consumers in the UK may need protection from goods and services from abroad as they may not be to a sufficient quality as safety standards may be lower. The growth of the internet has also caused the need for protection to increase as it is largely unregulated so goods and services may be undelivered. Customers sometimes have to give out their credit card details, which can lead to uncertainty. Customers may also be a target for Spam e-mail from companies that they are uninterested in.

The increasing complexity of many goods and services also causes the need for government protection to increase as technological advances in particular, have increased the gap between the knowledge of consumers and producers about products. Therefore consumers will be unable to truly assess the quality of the product, which could cause the producer to manipulate them.

The environment which businesses operate within is also becoming increasingly competitive and is believed that this degree of competition encourages business to take advantage of customers e.g. by reductions in the level of services or in the level of goods offered. The disposable income of many consumers has increased greatly over the last four to five decades. This means that the average consumer purchases far greater quantities of good and services than would have been the case in the past. Therefore more protection may need to be offered to consumers as a result.

Scientific advances have created a variety of materials that were not previously available. E.g. genetically modified products have developed as a consequence of scientific advances in the production of foods. Consumers may need to be protected against any possible harmful effects of such scientific discoveries.

One example of how...

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