Business rules encapsulate dynamic business policies and decisions that govern processes. They are defined formally in manuals or contracts and can change over time due to business or regulatory factors. Business rules are decoupled from application code and allow business analysts to manage logic more easily. Vocabularies bridge business semantics with technical implementations and rules consist of conditions and actions like "IF amount is less than funds THEN conduct transaction". Policies group related rules and the architecture integrates on-premises systems with cloud apps for scalable rule execution on Microsoft Azure.