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The Impact of Macro-Environmental Factors on Business Performance

Author

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  • Gini, Kiyentei Benneth

    (Department of Economics, Faculty of Social Sciences, University of Port Harcourt)

  • Agala, Humphrey Obinna

    (Department of Economics, Faculty of Social Sciences, University of Port Harcourt)

Abstract

This paper x-rayed the impact of macro-environmental factors on business performance in Nigeria. The narrative appraisal adopted in this paper showed that macro factors exert influence on and shape. growth and development of businesses in developing economies such as Nigeria. The macro-environment bears more relevance to strategic management, and businesses adjust to the external environment. It further revealed that the government now plays more of a regulatory role in the business environment in some sectors of the economy, and that, though certain measures had been put in place at various levels to engender a conducive business environment for private sector participation, macro (external) factors such as high interest and inflation rates, terrorism, culture, religion, volatile exchange rates, susceptibility of the economy to external shocks, etc., escalated cost of doing business and, thus, posed serious threats to firms performance. Therefore, the paper concluded that macro environments have a significant impact on the success of business activities, and hence such environmental factors must be considered seriously during the process of creating a strategic business plan. Considering these factors will improve the success of the business marketing campaign and the reputation of the brand in the long term. Consequently, reconsideration of such environmental factors that impose unnecessary constraints on businesses was recommended.

Suggested Citation

  • Gini, Kiyentei Benneth & Agala, Humphrey Obinna, 2023. "The Impact of Macro-Environmental Factors on Business Performance," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(11), pages 1837-1843, November.
    • Handle: RePEc:bcp:journl:v:7:y:2023:i:11:p:1837-1843
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    References listed on IDEAS

    as
    1. Amrou Awaysheh & Randall A. Heron & Tod Perry & Jared I. Wilson, 2020. "On the relation between corporate social responsibility and financial performance," Strategic Management Journal, Wiley Blackwell, vol. 41(6), pages 965-987, June.
    2. Ibrahim Abidemi Odusanya & Olumuyiwa Ganiyu Yinusa & Bamidele M. Ilo, 2018. "Determinants of Firm Profitability in Nigeria: Evidence from Dynamic Panel Models," SPOUDAI Journal of Economics and Business, SPOUDAI Journal of Economics and Business, University of Piraeus, vol. 68(1), pages 43-58, January-M.
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