MGMT 478 Ch.10

Seven principles of admirable business ethics

1. Be trustworthy; no individual or business wants to engage in business with an organization it does not trust 2. Be open-minded, continually asking for "ethics-related feedback" from all internal and external stakeholders. 3. Honor all commitments and obligations. 4. Avoid misrepresenting, exaggerating, or misleading with print materials, actions, or words. 5. Visibly be a responsible community citizen. 6. Use your accounting practices to identify and eliminate questionable activities. 7. Follow the Golden Rule: "Do unto others as you would have them do unto you."

10 Companies With The Best CSR Reputation as Rated by Consumers

1. The Lego Group 2. Microsoft 3. Google 4. Walt Disney Company 5. BMW Group 6. Intel 7. Robert Bosch 8. Cisco Systems 9. Rolls-Royce Aerospace 10. Colgate-Palmolive

Bribe

A gift bestowed to influence a recipient's conduct.

Wildlife Welfare

Consumers globally are becoming increasingly intolerant of any business or nation that directly or indirectly destroys wildlife, especially endangered wildlife, such as tigers, elephants, whales, songbirds, and coral reefs.

Which​ product-labeling term has come under increased​ scrutiny?

Green

When Life is Good's Chief Executive Optimist, Bert Jacobs, refers to the actions his organization takes to help children beyond writing a check or simply supporting a cause, he is describing his company's focus on______.

Social responsibility

Sustainability Reports

Sustainability report: • reveals how a firm's operations impact the natural environment • discloses to shareholders information about the firm's labor practices, product sourcing, energy efficiency, environmental impact, and business ethics practices

ISO 14000/14001 Certification

The ISO 14000 family of standards concerns the extent to which a firm minimizes harmful effects on the environment caused by its activities and continually monitors and improves its own environmental performance. • ISO 14001 is a set of standards adopted by thousands of firms worldwide to certify to their constituencies that they are conducting business in an environmentally friendly manner Results in an Environmental Management System (EMS )

What is meant by Life is Good's branding strategy, "Knowing who you are and acting like it?"

a company should know its mission a this may be the reason its customers believe in the company and its brand

Which of the following is NOT considered sexual​ harassment?

a workplace romance

The Institute of Business Ethics​ (IBE) recently conducted a study and concluded that companies displaying a​ "clear commitment to ethical​ conduct" ______.

consistently outperform companies that do not display ethical conduct

The responsibilities of a firm to​ employees, consumers,​ environmentalists, minorities,​ communities, shareholders, and other groups are referred to as​ ______.

corporate social responsibility

The position of most economists is best described how?

firms should not spend monies on philanthropic activities since making and growing profits is paramount

Employees should practice​ whistle-blowing, and organizations should​ ______.

have policies that encourage whistle-blowing

What position should company guidelines and policies take in regards to workplace​ romance?

it should be discouraged. Company guidelines or policies in general should discourage workplace romance because​ "the downside risks generally exceed the upside​ benefits" for the firm. Workplace romance guidelines should specify certain situations in which affairs are especially​ discouraged, such as between a supervisor and​ subordinate, and detail the types of relationships​ allowed, such as between​ peer-level employees in different departments who also have different career paths.

In many​ companies, the corporate environmental group is moving​ ______.

to report directly to the CEO

What debate regarding social responsibility does the video describe?

to what extent firms should spend monies on socially responsible acts given the continuous need to grow profitably

Does the video mention the need of firms to preserve wildlife rather than harm it?

yes

In addition to having a clear code of business​ ethics, managers must also consider the specific details of the​ code, how it will be​ implemented, and​ ______.

how adherence to it will be monitored

Whistleblowing in the United States is governed primarily by​ ______.

the SEC

Reasons Why Preserving the Environment Should Be a Permanent Part of Doing Business

• Consumer demand for environmentally safe products and packages is high. • Public opinion demanding that firms conduct business in ways that preserve the natural environment is strong. • Environmental advocacy groups now have more than 20 million Americans as members. • Federal and state environmental regulations are changing rapidly and becoming more complex. • Many lenders are examining the environmental liabilities of businesses seeking loans. • Many consumers, suppliers, distributors, and investors shun doing business with environmentally weak firms. • Liability suits and fines against firms having environmental problems are on the rise.

Environmental Sustainability

• Employees, consumers, governments, and society are especially resentful of firms that harm rather than protect the natural environment. • Conversely, people today are especially appreciative of firms that conduct operations in a way that mends, conserves, and preserves the natural environment.

Sustainability

the extent that an organization's operations and actions protect, mend, and preserve rather than harm or destroy the natural environment

Social Responsibility

- actions an organization takes beyond what is legally required to protect or enhance the well-being of living things

Environment

The surroundings in which an organization operates, including air, water, land, natural resources, flora, fauna, humans, and their interrelation.

Workplace Romance

Workplace romance can be detrimental to morale and productivity • favoritism complaints can arise • confidentiality of records can be breached • reduced quality and quantity of work could result • personal arguments can lead to work arguments • whispering secrets can lead to tensions • sexual harassment charges may ensue • conflicts of interest could arise

What report reveals how a​ firm's operations impact the natural​ environment?

a sustainability report

As Jacobs' notes, despite the company's focus on "doing good," it must continue to_____.

be profitable in order to continue its mission

According to the ISO 14001​ standard, an organization is required to put in place and implement a series of practices and procedures​ that, when taken​ together, result in​ a(n) ______.

environmental management system (EMS)

What information is NOT included in a​ firm's sustainability​ report?

financial ratios

What quote from the video was attributed to the CEO of Herbalife Company?

integrity equals - longevity

business ethics

principles of conduct within organizations that guide decision making and behavior

Of the following, which is TRUE of firms like Life is Good that engage in social responsibility?

they generally enjoy higher financial performance

Which of the following is TRUE of workplace romance​ guidelines?

They should apply to all employees at all levels of the firm and they should specify certain situations in which affairs are especially​ discouraged, such as between a supervisor and a subordinate

Code of Business Ethics

To ensure that the code of ethics is read, understood, believed, and remembered, periodic ethics workshops are needed to sensitize people to workplace circumstances in which ethics issues may arise.

Extensive research has revealed which of the following relationships between corporate social responsibility and corporate financial​ performance?

a U-shaped curve

Which of the following is TRUE of an​ EMS?

identifies all aspects of the organization's activities, products, and services that could have a significant impact on the environment

What quote from the video was attributed to Alan Simpson?

if you have integrity, nothing else matters. if you dont have integrity nothing else matters.

A gift bestowed to influence a recipient's conduct

is a bribe

Whistle-blowing

refers to employees reporting any unethical violations they discover or see in the firm

Life is Good's CEO Bert Jacobs says the company's branding strategy is, "knowing who you are and acting like it." Not only is this a branding strategy, it also ____.

reinforces the company's organizational culture

Bribery

the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official or other person in discharge of a public or legal duty a crime in most countries of the world, including the United States

Food Suppliers and Livestock Welfare

• Consumers expect humane treatment of animals. • Consumers are flocking to organic products.

Corporate Social Responsibility

• Ralph Nader proclaims that organizations have tremendous social obligations. • Milton Friedman asserts that organizations have no obligation to do any more for society than is legally required.

Corporate Social Responsibility (CSR) and Performance

• Research reveals a u-shaped relationship between CSR and corporate financial performance, whereby firms with the greatest CSR are generally also the firms with the highest financial performance; firms with the lowest CSR tend to have higher performance than those with moderate social responsibility. • Important to know that no social need can be met if the firm fails.

Business Ethics Topics That Have Become Important

• Whistle-blowing • Bribery • Workplace romance