International Business - Chapter 5

______ are situations where none of the available alternatives seems morally acceptable.

Ethical dilemmas

What management position serves as the organization's internal control point for improprieties?

Ethics Officer

Which statement accurately describes how personal ethics might be challenged in international transactions?

Expatriate managers may face more pressure to violate their personal ethics.

True or false: Pursuing strategies that are sustainable has little impact on helping an organization ensure that ethical issues are considered in business decisions.

False

True or false: Sustainable strategies adopted by a company typically only benefit upper management.

False

Which congressional act outlaws the payment of bribes to foreign government officials to gain businesses?

Foreign Corrupt Practices Act

The straw men theory that states that businesses should behave in a socially responsible manner, according to ethical custom and without deception and fraud is the _______.

Friedman Doctrine

What theories concentrate on the fair distribution of economic goods and services in a society?

Justice

______ ethics hold that one should always respect the humanity in others and act in accordance with rules that could apply to everyone.

Kantian

______ argued that it was ethically justified for General Motors to operate in South Africa so long as conditions of disobeying and promoting the abolition of apartheid laws were fulfilled.

Leon Sullivan

______ refers to the moral obligation to act in an honorable and benevolent manner.

Noblesse oblige

What are four determinants of ethical behavior?

Organizational culture Leadership Personal ethics Societal culture

Which two theories provide the moral compass that is important when thinking through the ethical implications of decisions in a systematic way?

Rawl's theory of justice Rights theories

As demonstrated by the Nike example in the text, which situation is generally MOST preferred when considering employment practices in international business?

Requiring good conditions in home and foreign operations even when this results in a smaller profit margin

The straw men approach to ethics is comprised of which four approaches?

Righteous moralist Cultural relativism Friedman doctrine Naive immoralist

Which approach to business ethics includes cultural relativism, the righteous moralist, and the naive immoralist?

Straw Men

General Motors adopted the ______ principles in order to continue business operations in South Africa during the apartheid movement.

Sullivan

Which description of leader behavior is most likely to promote a strong ethical culture in an organization?

The boss who consistently demonstrates strong personal ethics in all dealings with clients.

Garrett Hardin described how herders shared common land for grazing. It was advantageous to the poor to place more and more livestock on the commons because it would mean more income. Why did these actions result in ultimate tragedy?

The commons were overgrazed and eventually destroyed by the livestock.

In an organization where personal ethics are important, which individual should be considered for a job opening?

The individual who has a disappointing interview but has glowing letters of recommendation that attest to his integrity.

What is an accurate description of developed nations with regard to the environment?

They have more substantive environmental regulations.

True or false: According to cultural relativism, all ethics are culturally determined.

True

True or false: Business people may behave unethically because they forget to ask whether the decision or action they are making is ethical.

True

True or false: Businesses based in a utilitarian philosophy often use cost-benefit analysis when determining action.

True

Which of these common phrases can be used to describe the straw men approach known as cultural relativism?

"When in Rome do as the Romans."

True or false: Companies can use psychological tests in the hiring process to help identify people who have a strong sense of personal ethics.

True

True or false: The decision-making process is one of the determinants of ethical behavior.

True

The Universal Declaration of Human Rights was created by the _____ and has been ratified by almost every country.

United Nations

The UN ______ is a global expression of what many believe are the rights to which all human beings are inherently entitled.

Universal Declaration of Human Rights

______ ethics measure actions on a cost-benefit scale.

Utilitarian

Which ethical theory emphasizes that the best actions are those that benefit the most number of people and harm the least number of people?

Utilitarianism

Which company is contributing to the global tragedy of the commons?

Virtual-Day Inc. moved production to a South American country with lower environmental regulations and sends pollutants freely into the air.

Which three practices would be considered acceptable according to the concept of cultural relativism?

You should adopt the culture of the country that you are doing business in, no matter what. If a culture supports slavery, it is okay to use slave labor. There is a rejection of universal notions of morality.

Carla questioned the ethics of her company in hiring an Indonesian firm to manufacture its clothing products. She knew that women who worked in these sewing factories were forced to work long hours in substandard conditions and she knew she wouldn't like to work that way. Carla is demonstrating the use of ______.

a moral imagination

A person who follows the idea of _____ says that the multinational's home-country standards of ethics are the appropriate approach to follow in foreign countries.

a righteous moralist

It is wrong to cheat on a test. Conversely, it is right to

accept responsibility for your actions.

Some ethics experts have proposed practical guides or ethical ______ to make ethical decisions in a systematic way.

algorithms

Rawls' view of justice states that all economic goods and services should be distributed equally except when

an unequal distribution would work to everyone's advantage.

A policy of racial segregation and political and economic discrimination against nonwhites in South Africa was known as the

apartheid system.

One justification given for investment in China, which has a questionable human rights record, is that investment will

boost economic growth and raise the standard of living.

Many companies develop a formal statement of primary values and ethical standards for employees and managers to follow. This is called a

code of ethics.

International business frequently have to address ethical issues that develop because

countries have different business laws, practices and regulations

Maria's boss asked her to do whatever it takes to secure a contract. Maria knows that paying a bribe would ensure that the contract would be signed, but walks away because she knows that while paying the bribe would ensure large profits, doing so would be unethical. Maria is demonstrating moral ______.

courage

The belief that ethics are culturally determined and a firm should adopt the ethics of the country it is doing business in is

cultural relativism.

A company's organizational _____ reflects the values and norms that are shared among employees of an organization.

culture

Under Rawls' ______ principle, the long-run expectations of the least-advantaged social group need to be maximized.

difference

Sanjay told his staff that the company didn't care if the components came from a company using sweatshop labor, the parts were needed to meet the order and the company needed the order to make the sales quota. In this situation, the company makes this decision based on purely _____ terms.

economic

Ethical issues arise in international business when

environmental regulations in host nations are less stringent than those in the home country.

A business strategy that does not violate the accepted principles of right or wrong governing the conduct of businesspeople is called a(n) _____ strategy.

ethical

What is an example of a sustainable strategy?

A strategy designed to reduce CO2 emissions

In a business setting, noblesse oblige refers to _____ behavior considered to be the responsibility of successful enterprises.

Benevolent

According to the text, which three actions can managers take to ensure that ethical issues are considered in business decision making?

Build an organizational culture that values ethical behavior. Favor hiring and promoting of people with a sense of personal ethics. Implement decision-making processes that consider ethical aspects of business decisions.

The first thing Brett's manager told him when he started working was that the company always considered the social consequences of any business decision. This is a reflection of _____.

CSR

Global warming is said to be the result of which greenhouse gas?

Carbon dioxide

Gemini Corp. is a multinational company. Which argument should the company use to justify conducting business in a repressive country?

Continuing inward investment helps boost economic growth and living standards in the country.

Which of the four straw men approaches is associated with the phrase, "When in Rome do as the Romans"?

Cultural relativism

Bennie is managing a call center in Italy. He is finding it difficult to motivate employees to meet their call volume using the standard tactics employed in the United States. Bennie is told by another manager that if he starts offering "daily bonuses" to employees, they will meet their targets. He is torn between doing what is right and meeting his numbers. Which type of challenge is Bennie facing?

ethical

Scandinavia scores high on the individualism and uncertainty avoidance measures of societal culture. According to Hofstede's dimensions of societal culture, Scandinavia is more likely to engage in ______ business behavior than -- for example -- Russia.

ethical

When Phil's manufacturing company was fined by the US government for the amount of carbon dioxide it released into the air, it decided to move its business to Thailand where it knew there were fewer restrictions on air emissions. Environmentalists would most likely question the ______ implications of this decision.

ethical

Young children are permitted to work in the manufacturing of soccer balls in Pakistan, but this would not be legal in the United States. However, a company wants to sell these soccer balls in the United States to Kick-Rite Sports Equipment and Kick-Rite is not sure it wants to sell these particular soccer balls. This is an example of a(n) ______ dilemma.

ethical

Marietta is visiting her company's manufacturing subcontractor in Pakistan. She notices children working on the machinery with no air conditioning and little access to water. But she also knows these children are probably supporting their families. Marietta can't decide if children working in the factory is appropriate or inappropriate. This is an example of a(n) ______.

ethical dilemma

Henri reminded the group members that they should follow the principles of right and wrong set down by the organization when making their decision. These principles represent the _____ that govern the actions of the group.

ethics

Lucia is responsible for establishing a confidential service employees can use to question if a practice is unethical and she also makes sure the company complies with government laws and regulations. Lucia is an example of a(n) _____.

ethics officer

An ethical strategy is an action that

evaluates the impact of decisions based on the acceptable moral principles.

The Foreign Corrupt Practices Act was amended to include _____ because some US businesses complained the act would put US firms at a competitive disadvantage.

facilitating payments

Generon Inc. has moved its production to a new nation. It freely dumps its harmful waste in the rivers and causes environmental degradation there. In this case, Generon has contributed to the

global tragedy of the commons.

Up until the 1990s, companies conducted business in Myanmar and South Africa. However, it soon became evident that extreme ______ existed there, and companies began to leave.

human rights violations

Moral ______ allows a business to think about how a decision might impact the stakeholder.

imagination

According to the Friedman Doctrine, what is the only social responsibility a company has as long as it stays within the rules of law?

increasing profits

Individuals or groups who work for or own the business are referred to as ______ stakeholders.

internal

The fair and equitable dissemination of economic goods and services is the focus of a(n) _____ distribution.

just

One important drawback to the utilitarian philosophy to business ethics is that it does not consider _____.

justice

The tragedy of the commons phenomenon was named when Garrett Hardin noticed

large open areas were free for all to use as pasture.

The Hewlett-Packard example discussed in this chapter suggests that one cause of unethical behavior in a company can stem from _____.

leadership

An accurate description of the apartheid system in South Africa is it

mandated segregation between whites and nonwhites.

According to Hofstede's theory, cultures high in masculinity and power distance are _____ (more or less?) likely to engage in unethical behavior.

more

Celeste, a manager at a multinational investment firm located in Italy, knows that the company isn't reporting accurate profits to the government. She explains that this action is fine because all the multinational investment firms behave in the same manner. Celeste can be described as a(n) ______.

naive immoralist

The ______ believes that if a multinational firm sees that other firms are not following ethical norms, then they don't have to either.

naive immoralist

Trevor told his foreign-born roommate that it was socially acceptable in the United States to question a professor if you believed he or she was saying something that was not true. This example of a social rule that governs behavior demonstrates the idea of a

norm

The social rules and guidelines used to determine appropriate behavior in a particular setting are known as ______.

norms

Rights that are taken for granted in developed nations, such as freedom of association and freedom of speech are

not universally accepted.

When making ethical decisions, ______ factors are stressed in Japan while ______ factors are more important in the United States.

organizational; individual or personal

One concept included in Kantian ethics that is not found in the utilitarian approach is the need to respect

people's dignity.

The generally accepted principles and values that govern interactions between individuals are called

personal ethics

James is an expatriate managing a tech support center in India. He is a firm believer in the minimum wage and treating employees fairly. Yet he sees his assistant manager firing an employee and hiring his neighbor to do the job at a lower rate. James confronts his assistant manager, claiming this behavior isn't right. He is displaying the ______ approach to ethics.

righteous moralist

Certain theories accept that there are rights, both positive and negative, that all humans have simply because they are human. These are called ______ theories.

rights

The _____ theories recognize that there are things we CANNOT do against individuals because they have certain moral, fundamental rights.

rights

How do facilitating payments benefit a company?

smooths the progress of services to which the business is entitled

The idea that business people should favor decisions that have both good economic and social consequences is called corporate

social responsibility.

A(n) _____ strategy helps a company make good profits but does so without harming the environment.

sustainable

Starbucks' ethical sourcing policies are an example of a(n) ______ that benefits multiple stakeholders including shareholders, the environment, local communities, and customers.

sustainable strategy

Unrealistic performance goals can often only be attained by

taking shortcuts or behaving in an unethical manner.

Business ethics are defined as

the principles that govern the proper conduct and moral decisions that arise in a business environment.

TimeTurner Corp. is a company based in the United States that manufactures luxury wrist watches. By western standards, if the company uses sweatshop labor to make these watches it is most likely to be considered

unethical

The managers of Simple Sound Manufacturing are struggling to meet their quota that was recently increased by upper management. They decide to eliminate two quality control steps in the manufacturing process. This is unethical behavior that was a result of

unrealistic performance goals.

Garrett's company believes minimizing air emissions is the right thing to do, and it will not contract with a supplier who thinks otherwise. This idea about what the company believes to be right is an example of a

value.

What a group believes to be good, right, and desirable is a reflection of their ______.

values

In the 1980s, Western businesses questioned the ethics of operating in South Africa because the apartheid system in place there

violated basic human rights.