Political environment has an impact on every business operation regardless of its size or area of operation. A government seeks to promote its national interest by considering the available resources and political ideologies. These political ideologies have the impact of creating a stable or unstable political environment. The political stability of a nation affects the decision that International business make on conducting business in the country. On the other hand the legal environment affects a number of business issues, for example there are many laws that affect employment, taxes, international trade, health and job training.  These laws concerning the above mentioned factors must be incorporated into business strategic plans to avoid problems with law.

For example due to the US growth oriented policies, Nike Company was able to benefit from the low interest rates and currency exchange stability and thus recorded high profits. On the other hand lack of political stability in countries such as Syria where there was an aggressive overthrow of the government which led to rioting and general disorder, caused major business disruptions for International Corporation as well as domestic business.