Ethics Test Banks

What do Crane and Matten identify as a focus for debate in the case of companies expanding into new, international markets? Select all that apply.

Erosion of local cultures and rise of cultural homogenization, Increasing predominance of consumerist ideologies, Deliberate removal of domestic rivals.

Cooperatives are owned and run by their managers

False

Donaldson proposes principles for organizations working internationally and needing to address cultural differences when developing their ethical codes. What are these principals? (Select all that apply)

Respect for local traditions, the belief that context matters when deciding what is right and wrong, respect for core human values which determine an absolute threshold

Match the following employee rights with the examples of the issues involved

Right to privacy = work-life balance. Right to due process = disciplinary proceedings. Right to healthy and safe working conditions = occupational health and safety. Right to work = fair treatment in the interview

The four kinds of constructive engagement between civil society and business, according to Crane and Matten, are charitable giving, business-CSO collaboration, blank and 'civil regulation'.

Social enterprises

Rest's 4 stage model of ethical decision making

Stage 1 =recognize a moral issue Stage 2 = make a moral judgment Stage 3 = Establish moral intent Stage 4 = Engage in moral behaviour

According to Kaler (1999), the two main areas to which an employee's right to participation extends are operational participation and a right to association. True or False?

False

According to resource dependence theory, power derives from the degree of dependence that each actor has on the other's resources. This dependence is a function of the quality of an organization's resources and how useful they are to the other party.

False

What responsibility are sellers often said to have, in relation to customers perceived to be vulnerable in some way?

A duty of care

Which of the following is a scheme to tackle the specific aspect of reporting assurance in social accounting?

AA 1000S

Correctly complete the comparison of corporate governance regimes globally, with respect to ownership identity

Anglo-American model = Individuals, pensions and mutual funds. Rhenish capitalism = Banks, corporations, state. India = Families, foreign investors, banks. China = State, families, corporations

Crane and Matten define a conflict of interest as follows: 'A conflict of interest occurs when a person's or organization's obligation to act in the interests of another is interfered with by a competing interest that may blank the fulfilment of that obligation.'

Obstruct

Which of the following is not one of the issues that Zadek et al have proposed as the key principals of good social accounting

protecting the integrity of confidential data

Crane and Matten identify two very different models of informal ethics management. Is the following statement true or false? In the culture change approach, the leader's role is one of participation and empowerment in order to foster moral imagination and autonomy on the part of employees. On the other hand, in the cultural learning approach, the leader's role is to articulate and personify the values and standards to which the organization aspires, and to then inspire and motivate employees to follow their lead

False

Instrumental stakeholder theory is a theory that attempts to explain how firms take into account stakeholder interests

False

Match the following statements about the effect of globalization on the context of business-government relations

Intensity of regulation in a national context = Decreasing intensity (e.g., deregulation, privatization). Intensity of regulation in a globalized context = Increasing intensity. Addressee of regulation in a national context = Social actors (e.g., domestic companies, citizens). Addressee of regulation in a globalized context = Nation states (e.g., EU member states), private transnational actors

'Green jobs' is one of the main ways in which the problems and tensions inherent in the concept of sustainable development has been addressed. Which of the following do Crane and Matten identify as aspects of green jobs? Please select all that apply.

Jobs become more environmentally sustainable through reorganization of labour and the workplace, Jobs in industries producing environmentally friendly goods and services.

Crane and Matten suggest that businesses can best be understood as part of an industrial network rather than part of a simple exchange between two parties. What does this suggest about corporate interactions?

Notable decisions about how the firm deals with any single other firm can have a significant effect on other members of the business network, including suppliers and competitors.

One attempt to address social elements is the UN's Millennium Development Goals (MDGs), which is a set of 8 goals to be achieved by 2015. Which of the following is not an MDG?

Reduce domestic violence

Match the following context related situational influences with the descriptions of their influence on ethical decision-making

Rewards = Strong evidence of relationship between rewards/punishments and ethical behaviour, although other stages in ethical decision-making have been less investigated. Authority = Good general support for influence from immediate superiors and top management on ethical decision-making of subordinates. Bureaucracy = Significant influence on ethical decision-making well documented, but actually exposed to only limited empirical research. Specific consequences for ethical decision-making therefore remain contested. Organizational culture = Strong overall influence, though implications of relationship between culture and ethical decision-making remain contested.

Complete the matching of some of the key differences between a social enterprise and a corporation

Role of profit in a social enterprise = Profit earning; limits on profit distribution. Role of profit in a corporation = profit maximizing. Governance of a social enterprise = based on participation and democracy amongst stakeholders. Governance of a corporation = based on accountability to providers of capital

What is the Accountability Charter, which was launched in 2006?

The charter is to serve as a code of conduct for NGOs on the international stage.

Crane and Matten argue that the pressure exerted by powerful corporate customers to comply with ethical sourcing guidelines and criteria constitutes a kind of regulatory intervention in the supply chain. True or False?

True

The Dow Jones Sustainability Index takes a best-in-class approach, meaning the DJSI includes the following kinds of shares (Select all that apply)

those companies identified as the sustainability leaders in each industry

Why is business ethics important? Select all that apply

Business has greater power and influence in society than ever before, business has the potential to provide a major contribution to our societies, business malpractices have the potential to inflict enormous harm on individuals, communities and the environment, business continues to violate ethics across countries and sectors (all of the above)

Detomasi (2007) talks of 'global public policy networks,' in which 'the strengths of state, market, and civil society actors combine to create an effective international governance system that overcomes the weaknesses afflicting each individually.' What is the main instrument that is used in such networks to regulate the social, ethical, and environmental impacts of business?

Codes of conduct

What are industrial ecosystems?

Communities or organizations bound by interdependence of all kinds of resources and wastes

Travino et al identified 4 main ways of approaching the formal organization of business ethics management, match the label with the description

Compliance orientation = Main emphasis is on preventing, detecting, and punishing violations of the law. Values orientation = Approach is based on defining organizational values and encouraging employee commitment to certain ethical aspirations. External orientation = The focus is on satisfying stakeholders such as customers, the community and shareholders. Protection orientation = Primary orientation is (or is perceived to be) towards shielding top management from blame for ethical problems or legal violations.

What are the dimensions of Smith's (1995) consumer sovereignty test? Select all that apply.

Consumer capability, Choice, Information

Blank describes the process by which shareholders seek to ensure that their corporation is run according to their intentions. It includes processes of goal definition, supervision, control, and sanctioning.

Corporate governance

Bird and Waters describe the phenomenon of moral muteness, in which managers reframe moral actions and motives in non-moral terms. Managers do this because they are worried about perceived threats. Which of the following do managers not feel is under threat through the use of moral terms?

Credibility = the fear of losing organization credibility with stakeholders, particularly shareholders

Institutional discrimination means that the very " " of the organization is the prejudiced against certain groups.

Culture

Blank occurs when a marketing communication either creates, or takes advantage of, a false belief that substantially interferes with the ability of people to make rational consumer choices.

Deception

Read the following statements carefully and indicate which of them Crane and Matten identify as being among the most serious issues (from an ethical perspective) in the globalization of financial markets (Select all that apply)

Deterritorialized financial markets impose the problem that no national government is entitled to govern these markets, as globalized financial markets are not fully controlled by national governments, they can easily be used for transactions that would be illegal in most countries.

Crane and Matten define business ethics management as follows "Business ethics management is the blank attempt to formally or informally manage ethical issues or problems through specific policies, practices, and programmes"

Direct

Carroll developed a four-part model of CSR to address the nature of business's social responsibilities. According to Carroll's model which of the follow responsibilities does society expect businesses to meet?

Ethical responsibilities

According to Shankman two features make agency relations special. One of these is the inherent conflict of interest between shareholders and managers, which is the other?

Informational asymmetry between principal and agent

What is civil society? Select all that apply.

Non-profit distributing organizations, Involved in the promotion of social interests causes and/or goals, Examples include social enterprises non-governmental organizations and religious groups

With which of the following statements on ethical issues in relation to competitors would Crane and Matten agree?

There is a clear ethical issue in the case where a single large competitor dominates the market, as it can disadvantage consumers and competitors.

Which of the following do Crane and Matten not provide as an example of an issue associated with an employee's duty to respect their employer's property?

Whistleblowing

Given the emerging role for corporations in the administration of civil, social and political rights, Crane and Matten argue that the extended view of corporate citizenship suggests the following definition

corporate citizenship describes the corporate function for governing citizenship rights for individuals

Crane and Matten contend that a corporation can be morally responsible for its actions, because it has agency independent of its members. The main arguments in support of this point center on a corporation's internal decision structure and corporate blank

culture

What is at the 'bottom of the pyramid' concept?

focus on offering innovative products and services to the world's poorest people.

Crane and Matten's definition of a stakeholder makes it clear that is it impossible to identify a definitive group of relevant stakeholders for any given corporation in any given situation. Nevertheless, a typical representation is possible, and three different models are presented. Which of the following stakeholders are included in the stakeholder view of the firm and in the network model of stakeholder theory, but not in the traditional model of managerial capitalism?

government

Socially responsible investment is the use of ethical, social, and environmental criteria in the selection and blank of investment portfolios, generally consisting of company shares

management

Risk analysis and management is one of the key components of business ethics management. According to Sison this is because the language of risk assessment has encourage firms out spell out the risks that firms run by ignoring ethics in terms of...

possible monetary impact

A sex shop might call itself ethical because it...

sells sex toys made with environmentally friendly materials, uses fair trade materials in its toys and aides, provides philanthropic support for related causes, promotes a label to certify that sex industry workers have not been exploited in the making of labeled products (all of the above)

It is now generally accepted that business responsibility does extend beyond simply making a profit. Which of the following do Crane and Matten list as business reasons for CSR? Select all that apply

socially responsible firms may find it easier to attract employees who may be more committed, corporations seen as responsible may attract more and/or more loyal customers, by engaging in voluntary CSR, corporations may avoid government legislation

What is Crane and Matten's definition of sustainability

sustainability refers to the long-term maintenance of systems according to the environmental economic and social considerations

Which of the following is not one of the factors that Crane and Matten identify as the most important in deciding whether a situation should be assigned a moral status?

the decision is likely to be open to legal challenges

Ethics rationalizes morality to produce ethical blank that can be applied to any situation

theory

Crane and Matten define the subject of business ethics as, "The study of business situations, activities, and decisions where..."

...issues of right and wrong are addressed

Match the following statements with respect to company reporting on ethical performance 'Approaches prefaced...tend to..."

'ethical' = focus on internal management systems, or individual-level aspects of the business. 'environmental' = focus on exclusively on the organization's impact on the natural environment. 'social' = have a broader remit, covering a range of issues in addition to (or sometimes separate from) the environment, such as employee conditions or community relations. 'sustainability' = are concerned with the triple bottom line of social, economic, and environmental considerations.

One of the key policy areas of sustainability has been on the issue of global climate change. Correctly complete the timeline.

1992 = World Business Council on Sustainable Development lobbies against any concrete measures at global level on climate change. 1996-1998 = Shell and BP leave the Global Climate Coalition in the face of European Union commitment to Kyoto and stakeholder pressure in the EU. 2005 = The European Union launches its Emissions Trading Scheme. This is a market mechanism designed to achieve greenhouse gas reductions. 2006-2008 = A growing number of firms conclude that measures to tackle climate change are inevitable and it is therefore prudent to be part of the process.

A code of conduct is all very well, but to be successful in practice, Emmelhainz and Adams (1999) argue that ethical sourcing through the supply chain requires the following: Select all that apply.

A workable code of conduct, Enforcement policies which establish the penalties for violation, A system of monitoring supplier compliance with the code.

In what ways is government a stakeholder of business? Select all that apply.

As a representative of citizens' interests, government restricts business, As an actor with interests of its own government is dependent on business, As an actor with interests of its own government is in competition with business

In his influential 1970 article, Milton Friedman protested against the notion of corporate responsibility for corporations. Which of the following is not one of the 3 main premises of his argument?

Corporate responsibilities limit a corporation's freedom to choose how to pursue its main task of increasing profits

The degree of interaction between business and CSOs has intensified at the same time as it has increased in scope and incidence. Which of the following do Crane and Matten identify as one of the risks?

Corporations co-opt their CSO partners, threating the independence that makes the CSO sector such an important balance to corporate power.

Business has become a key player in the regulatory game, with a number of new forms of regulation emerging in recent years. What are the goals for those trying to introduce new types of rule-making, according to Calster and Deketelaere (2011)? Select all that apply.

Cost-effectiveness (financial savings), Faster achievement of objectives (speed), Encouragement of a proactive approach from industry (integration into the regulatory process)

Translate the following terms

Flexibility = management can do what it wants. Empowerment = making someone else take the risk and responsibility. Recognizing the contribution of the individual = undermining the trade union and collective bargaining. Teamworking = reducing the individual's discretion

Which of the following statements on global issues and causes would Crane and Matten agree with?

Global issues raise the prospect of coordinated global attention from international CSOs and multinational corporation.

Since the late 1980's we have witnesses a growing tendency towards the "privatization" of many political functions and processes formerly assigned to governments. Which of the following are examples of how people's lives are increasingly controlled and shaped by corporations as well as governments? (Select all that apply)

Globalization facilitates relocation and potentially makes companies able to engage governments in a "race to the bottom", decisions over employment, lay-offs and relocation are taken by firms, and governments cannot directly control employment levels (though they are made responsible for unemployment), the privatization of major public services and publicity owned companies has led to private actors dominating major industries such as media, telecommunications, and transport, market and industrial liberalization and deregulation has increased the power of private actors: the more strongly the market dominates economic life, the weaker governmental intervention and influence is (all of the above)

Match the regulatory outcomes at national level with the regulatory actor group involves, in the following multi-factor setting

Government = National imperative regulation (e.g. 35-hour week in France). Government and business = Country-wide agreements with government (e.g. voluntary environmental agreements in place in many countries). Business and CSO = Country-wide agreements with CSOs (e.g. agreements between businesses and trades unions). Business, government and CSO = Country-wide multipartite agreements and projects (e.g. Covenant for Work in Germany)

Government is located between the interests of business and society. Complete the following matching which sets out the relationship in a little more detail

Government provides society with = Regulation that protects their interests. Government receives from society = Consent and tolerance. Government provides business with = Profitable and stable economic framework. Government receives from business = taxes, jobs, investments, etc

You are the purchasing manager at ACME Ink Supplies, Inc. The sales rep from a new supplier gives you a large box of premium quality Belgian chocolates after your first test purchase, with a note thanking you for the business. You like chocolates, but are not sure you should take the gift. What would Crane and Matten suggest you might consider in making up your mind? Select all that apply.

How might your existing supplier perceive the gift, What do you think is the intention of the sales rep, What impact would the gift have on you.

With regard to difference between national cultures and moral values, what do Crane and Matten suggest should be the starting point for providing direction between the two poles of absolutism and relativism on questions of employment conditions?

Human rights should be a basic compass

The law can be said to be a definition of the minimum acceptable standards of behaviour, with many morally contestable issues not covered by the law. What does this imply for business ethics?

In a sense, business ethics can be said to begin where the law ends

Which of the following statements about ethical consumption would Crane and Matten agree with? Select all that apply.

In responding to ethical consumers, companies have two basic options: they are either adopt an ethical niche orientation to the ethical market, Consumers can to some extent act as a social control on business.

Which of the following statements are to be found in Crane and Matten's definition of consumer rights? Please select all that apply.

Inalienable entitlements to fair treatment when entering into exchanges with sellers, They rest upon the assumption that consumer dignity should be respected, They rest upon the assumption that sellers have a duty to treat consumers as ends in themselves

One of the numerous ways in which business can influence government is for it to engage in lobbying, which Crane and Matten define as an attempt by business to influence government decisions making through blank and persuasion.

Information provision

Match the following explanations of cognitive moral development with one of the stages identified by Kohlberg

Instrumental purpose and exchange = individuals are concerned with their own immediate interests and define right according to whether there is fairness in exchange or deals they make. Interpersonal accord, conformity, and mutual expectations = individuals live up to what is expected of them by their immediate peers and those close to them. Social accord and system maintenance = individuals consideration of the expectations of others broadens to social agreement for generally. Social contract and individual rights = individuals assess right and wrong according to the upholding of basic rights, values and contracts of society

Match the following common ethical problem around marketing with the main consumer rights involved

Intrusiveness = right to privacy. Predatory pricing = right to fair prices. Buyer-seller relationships = right to engage in markets. Consumer exclusion = right to basic freedoms and amenities

Werhane sees moral imagination as the creativity with which an individual is able to reflect about an ethical dilemma, why is this significant?

It allows the individual to develop alternative solutions

As western firms have become more familiar with traditions, such as the Chinese practice of guanxi, so they have increasingly tolerated gift-giving practices in such countries. What is the reason for this, according to Donaldson (1996)?

It is a matter of respect for local traditions

There are clear regional differences in business ethics. Read the following statements and decide which of the following is correct

Key issues in business ethics in Asia are corporate governance and accountability. In North America they are misconduct and immortality in single decision situations. In Europe, key issues in business ethics are social issues in organizing the framework of business

Match the different types of organization with their different approaches to managing ethics

Large corporation = formal, public-relations, and/or systems-based. Small business = informal, trust-based. Civil society organizations = informal, values-based. Public sector organization = formal, bureaucratic

Hofstede suggests that differences in cultural knowledge and beliefs across countries can be explained in terms of 5 dimensions. Read the following description carefully and indicate which of Hofstede's 5 dimensions it describes "the extent to which an emphasis is placed on valuing money and things versus valuing people and relationships"

Masculinity/Feminity

Anand and colleagues identify 6 different strategies of rationalizing unethical behaviour. What strategy am I using if I make the following argument "Its okay for me to use the Internet for personal reasons at work after all, I do work overtime a lot"

Metaphor of the ledger

Stakeholder relationships can take a wide variety of forms. Match the kind of stakeholder relationship with the correct description

One-way support = relationships based on philanthropy, sponsorship or other forms of resource contribution from one party to the other. Joint venture or alliance = Relationship based on formal partnership involving significant mutual commitment to achieve specific goals. Project dialogue = Relationship based on discussion between partners regarding specific project or proposal, such as stakeholder dialogue accompanying major regeneration or construction projects. Strategy dialogue = Relationship based on discussion between partners over longer-term issues and the development of overall strategy for organizations, industries or regulatory regimes.

Individual factors with their likely influence on ethical decision making

Personal values = significant influence, some empirical evident citing positive relationship. Personal integrity = significant influence likely, but with lack of inclusion in models and empirical tests. Moral imagination = A new issue for inclusion with considerable explanatory potential. Locus of Control = limited effect on decision-making, but can be important in predicting the apportioning of blame/approbation

Boycotts are probably the most widely used form of non-violent direct action. Friedman (1999) suggests a number of purposes that CSOs may have for boycotts: which of the following is not one of Friedman's suggestions?

Promotional boycotts aim to shift business from on company to the sector's best performer as a means of encouraging weaker companies to change their policies.

Ruggie (2008) has developed a framework for understanding business and government responsibilities in the area of human rights. It is a framework of...

Protect, respect and remedy

Imagine a retailer introduces a programme aimed at making sure employees smile and appear happy in front of customers. This is an example of which of the four kinds of threat to privacy that Simms (1994) suggests we might want to protect? Choose the best fit.

Psychological privacy

Ballwieser and Clemm identify 5 main problematic aspects of the financial intermediary's job, which of the following is not one of them?

Ratings are frequently unreliable

Carroll has delineated four strategies of social responsiveness, match the strategy name with its description

Reaction = the corporation denies any responsibility and does what is demanded of it by relevant groups. Defence = the corporation admits responsibility, but fights it, doing the very least that seems to be required. Accommodation = the corporation accepts responsibility and does what is demanded of it by relevant groups. Pro-action = the corporation seeks to go beyond industry norms and anticipates future expectations by doing more than is expected

Blank includes rule definitions, laws, mechanisms, processes, sanctions, and incentives.

Regulation

Crane and Matten identify different types of CSOs: match them

Sectional group aims = self-interest, Promotional group aims = social goals, Sectional groups exert pressure through = threat of withdrawal, Promotional groups exert pressure through = mass media publicity

Fair trade is concerned with more than just the fairness of exchange relationships in a narrow economic sense. It is just as much concerned with blank an organization's suppliers and the communities and environments where these suppliers are located.

Sustaining

Carefully read the following statements about recognizing CSO stakes in business and indicate which of them Crane and Matten would agree with. Select all that apply.

The boundaries defining which CSO can reasonably be defined as stakeholders are permeable and evolving rather than concrete and fixed, Firms are more likely to recognize and respond to CSOs that are known, trusted and not too critical

Buncholz (1998) identifies the changing ethics governing our societies as a factor in the move towards more sustainable consumption. Which of the following statements is accurate according to her model? Select all that apply.

The consumerism ethic promotes instant gratification and consumption.

There are numerous ethical issues around executive pay. Which of these do Crane and Matten identify as a reason that executive pay touches an ethical chord with the public in many countries

The pay differentials between those at the top and those at the bottom appear to be highly inequitable

'Presenteeism' is a common cultural force in many organizations - but what is it?

The phenomenon of being at work when you should be at home recovering or enjoying time off

CSOs have a role to play in encouraging business to promote sustainability, but the relationship is not free of challenges. What do Crane and Matten identify as challenges for business in engaging with CSOs on sustainability? Select all that apply.

Whether an how to sustain civil society through their actions, given CSOs' vital role in encouraging sustainable development, Deciding how to balance the competing interests of different CSOs, Deciding the extent of community and/or CSO participation in corporate decision-making

According to Crane and Matten, globalization as defined in terms of the deterritorialization of economic activities is particularly relevant for business ethics, and this is evident in three areas: culture, law, and blank

accountability

Crane and Matten identify 4 main types of ethical codes. Read the following carefully and choose which of the following is not one of these 4 main types

accreditation codes of ethics (eg. Use of fair-trade mark)

The bureaucratic dimension of organizations has been argued to have negative effects on ethical decision-making. Read the following carefully and indicate which is not one of these negative effects

denial of responsibility

Which of the following do Crane and Matten not list as being a common issue in the context of privatization and deregulation?

public-private partnerships (the profit maximization of business may conflict with effective public service provision)

Mackenzie identifies two types of SRI funds; Market-led funds choose the firms to invest in following the indication of the market. Deliberative funds base their portfolio decisions on:

their own ethical criteria

The notion of caveat emptor has been eroded over time. One example of this is the UN's guidelines on consumer protection. Carefully read the following statements and indicate which of them is not one of the objectives of those guidelines.

to promote the availability of effective consumer redress

In order to enhance corporate accountability, corporate social activity, and performance should be made more visible to those with a stake in the corporation. The term usually applied to this is blank

transparency