mgt 481 - exam 1

Which of the following is NOT an argument against globalization?

Globalization encourages strong worker unions.

Which of the following statements is most accurate regarding transfer payments, according to the powerpoint slides?

Welfare payments are an example of a transfer payment.

Link #1 is to a video of the action that the Rainforest Action Network (RAN) took against General Mills at the start of its campaign to get the company to stop using palm oil that was not sustainably produced. Which of the "domains of social control" discussed in Rands' CSP Model was RAN utilizing?

moral/symbolic

Which of the types of market failures described in the text and powerpoint slides most commonly results in pollution and other environmental problems?

negative eternalities

The total amount of money that is invested based on the various forms of social investing strategy in the United States, according to "SRI Basics" is approximately

$8.7 trillion

Which of the following examples does not show a company guided by enlightened self-interest?

A company breaking past records by maximizing quarterly profits.

Scholars have found that:

A generally positive association between social and financial performance.

Which of the following is correct regarding economic regulation?

Antitrust regulation is a special form of economic regulation

Under the World Trade Organization's most-favored nation rule:

All import restrictions are illegal unless proven scientifically.

According to information found in the Sustainable & Responsible Mutual Fund Chart, on the issue of pollution/toxics, which of the following SRI mutual funds invests only in companies with positive impacts on this issue?

Brown Advisory Sustainable Growth Fund

To influence government policymakers' actions, an information strategy involves:

Business providing government policymakers with their viewpoint on issues.

The loan policies of the World Bank:

Can impose strict conditions on debtor countries which can sometimes lead to hardship.

Trade associations are:

Coalitions of companies in the same or related industries.

Deregulation has occurred in the following industries:

Commercial airlines, railroads and financial institutions.

Some companies have created a department of corporate citizenship (or some similar name) to:

Consolidate various corporate citizenship functions in one unit

According to Lawrence & Weber, the costs of corporate social responsibility may ultimately be passed on to the:

Consumer through high prices.

When working well, the issue management process:

Continuously cycles back to the beginning and repeats.

Which of the following is NOT a constituency-building strategy tool?

Expert witness testimony.

A "stakeholder" is best defined as any group or individual that is affected by an organization's decisions, policies or operations.

False

A national health care policy is an example of an economic policy.

False

According to Performance and SRI (a link from SRI Basics), the economic performance of socially responsible investing funds has been poor, and has resulted in such funds receiving much lower average ratings from rating services than all other mutual funds as a group.

False

According to Rands, "corporate social responsiveness" refers to the impacts that corporate actions have on society.

False

Government subsidies typically affect all parties (e.g., all industries, all firms, or all individuals) in a roughly equal manner.

False

In the slides a distinction is made between two types of socially responsible businesses: srbs and SRBs. The top 10 companies in CR's 100 Best Corporate Citizens list are predominantly SRBs.

False

Lawrence and Weber argue that top executives should definitely be considered to be stakeholders of the organization.

False

Lawrence and Weber cite the results of a 2006 study by the McKinsey consulting firm on executive views of corporate responsibility. The findings indicate that the majority of executives' responding indicated that business should primarily focus on maximizing economic returns to investors, and not worry about meeting responsibilities to other stakeholders.

False

Private equity funds and hedge funds engage in shareholder activism predominantly in order to boost the social performance of companies in which they are invested.

False

Public policy is a plan of action undertaken by business to influence the government.

False

Rands' Model of CSP provides a complete guide to making decisions about what is ethically right and wrong regarding a certain social issue

False

Regulation cannot be applied to international business behavior.

False

Taxation, according to Lawrence & Weber, is a "social assistance policy" type of public policy activity.

False

The Securities and Exchange Commission prohibits stockholders from placing resolutions concerning environmental responsibility in proxy statements sent out by companies.

False

The stakeholder theory of the firm argues that a firm's sole purpose is to create value for its shareholders.

False

Which of the following statements regarding the Genuine Progress Indicator (GPI) is LEAST accurate, based on the slides and the required article on this topic?

GPI adjusts GDP to account for levels of income inequality; this cause the value of the GPI to be higher than the value of the GDP

Which of the following top 25 members of the 100 Best Corporate Citizens of 2018 was most highly ranked on its handling of climate change issues?

Hasbro

Looking to the "strategic radar screens" identified by Lawrence and Weber is especially critical during which step in the issues management process?

Identify Issue

Which of the following is not an argument in favor of corporate social responsibility?

Imposes unequal costs among competitors.

The iron law of responsibility says that:

In the long run, those who do not use power responsibly will lose it.

Firms that believe they can make decisions unilaterally, without taking into consideration their impact on others are:

Inactive companies

Which of the following is NOT an example of a social regulatory agency?

National Labor Relations Board

Rands' Model of Corporate Social Performance takes a systems approach. Which of the following best describe this.

It is based on the notion of an open system, which holds that the action of an organization can be understood in terms of its inputs from its environment, the throughput of the organization itself, and the outputs it sends to its environment.

A reason cited by Lawrence and Weber for institutions becoming more assertive in promoting the interests of their member investors is:

It is difficult for institutions to sell their holdings without depressing stock price and therefore value of their holdings.

When a customer sues a company for physical and mental harm caused by unsafe toxic chemicals disposal, it is an exercise of a stakeholders':

Legal power.

Failure to understand the beliefs and expectations of stakeholders:

Permits the performance-expectations gap to grow larger.

A common tactic in a financial-incentive political strategy is:

Political contributions.

A firm subscribing to the ownership theory of the firm, would predominately be concerned with providing value for its:

Shareholders.

Spending on social regulation is:

Significantly higher than spending on economic regulation

Around the world, government:

Sometimes cooperates and sometimes is in conflict with business.

Public policy effects are:

Sometimes intended and sometimes unintended.

An example of a nation which in the late 20th century had a government whose actions were widely regarded as illegitimate can be seen in:

South Africa.

A business and its stakeholders coming together for face-to-face conversations about issues of common concern is:

Stakeholder dialogue

Once an organization has implemented a plan to manage a particular public issue, it must most immediately:

Study the results and make necessary adjustments.

Which of the following statements relating to the Bottom of the Pyramid is NOT correct?

The bottom of the pyramid has also been categorized as all those earning less than $5000 US per year (in local purchasing power).

Which of the following four statements (a-d) regarding the "Intel and Conflict Minerals" case is NOT accurate.

The central social problem in the case is the horrific pollution created in the mining and processing of ore into coltan.

In the third stage of corporate citizenship described in the text (and summarized in Figure 3.5):

The company recognizes that fulfilling its citizenship policies is more difficult than it thought and engages in structural innovations.

Companies have been permitted to spend company funds to organize and administer political action committees since:

The mid-1970s.

Stakeholder engagement refers to:

The process of ongoing relationship building between a business and its stakeholders.

The primary purpose of the International Monetary Fund (IMF) is:

To lend foreign currency to member countries.

Economic leverage occurs when a business uses its economic power:

To threaten to leave a location unless a desired political action is taken.

"Inversion" refers to the practice of an American company merging with a foreign company and designating the foreign country as the entity's headquarters in order to reduce its U.S. taxes owed.

True

A company that is highly committed to transparency is more likely to engage in social reporting than one that does not have this commitment.

True

According to Lawrence and Weber, shareholder lawsuits are used to address questionable issues relating to company economic performance more than questionable issues relating to company social performance.

True

Corporate social responsibility implies that harm to people and society should be acknowledged and corrected if possible.

True

Divestment from companies with very poor performance on one or more social issues is sometimes called for by shareholder activists.

True

Excellent competitive intelligence can be a differentiating factor in the marketplace.

True

In Archie Carroll's model of CSR, making a profit is viewed as a legitimate responsibility to society, rather than as being in opposition to a corporation's responsibility to society.

True

Monetary policies refer to policies that affect the supply, demand and value of the nation's currency.

True

Putting all the emphasis on short-run maximum profits for stockholders can lead to policies that overlook the interests and needs of other stakeholders.

True

The external environment of business is dynamic and ever changing.

True

The type of regulation that is newer, grew particularly rapidly in the 1960s and 1970s, and tends to address issues that apply to many industries rather than single industries is social regulation.

True

Under U.S. law, lobbying activities must be disclosed publicly.

True

In Rands' Model of CSP, all of the following are true of the "posture of response" dimension EXCEPT

a choice of a problem solving posture cannot be used with a political response tactic

Which of the following best illustrates the "market failure" concept mentioned in the text?

a number of consumers become ill from eating spoiled fish from the seafood section of a grocery store

Which of the following is NOT a way in which government can influence business in a non-regulatory sense?

actions taken by government agencies such as the EPA, OSHA and FDA

Stakeholder groups can include:

all of the above: Stockholders, The Media, and Environmental activists.

In Rands' Model of CSP, the Social Responsiveness portion of the model contains all of the following processes EXCEPT:

all of the above: assessing the company's effectiveness in implementing its policy for responding to a social issue, formulating the company's response to a social issue, learning about, assessing, prioritizing and developing recommendations regarding a social issue, and implementing policies for dealing with a social issue

Which of the following four statements (a-d) is NOT a step in the process of socially auditing a supplier, as described by Lawrence and Weber.

all: decide whether to use an internal, third-party, or crowd-sourcing approach to conduct the audit, investigate the practices being engaged in by the supplier in their operations (carry out the audit), decide what to do about any non-compliant practices discovered, and decide what information, if any, to report to other parties, and to whom and how

Which of the following is NOT a market stakeholder of a business firm, according to Lawrence and Weber?

business support groups

Which of the four phases of CSR identified by William Frederick in the Lawrence & Weber text (Figure 3.2) introduced and was particularly concerned with managing social issues and stakeholders, consistent with earlier discussions in the text of stakeholder and issues management?

corporate social responsiveness

Which of the following social issues is most frequently subjected to a completely exclusionary social screen by the first 13 SRI funds that the Sustainable & Responsible Mutual Fund Chart provides data on? (ending with Aspiration Redwood Fund)

defense/weapons

Which of the following is NOT one of the four key considerations in stakeholder analysis?

determining what means can be used to discredit the various stakeholders of the firm

According to Figure C of the 2016 Report on Sustainable, Responsible and Impact Investing Trends, the most common approach to socially responsible investing today is:

incorporation of environmental, social and governance (ESG) criteria by money managers and community investing institutions

Which stage/stance/posture of stakeholder engagement did The Coca-Cola Company eventually take, according to the events described in the "Coca-Cola's Water Neutrality Initiative" discussion case found in L-2?

interactive

In Rands' Model of CSP, which of the following is NOT true of the "tactical arena of response' dimension?

it is part of the input portion of the model

Which of the following types of organizations is designed to enable politicians to raise money that can then be donated to other politicians' campaigns?

leadership PACs

According to Rands' Model of Corporate Social Performance (CSP), the Social Responsibilities portion of the model contains all of the following elements EXCEPT:

organizational actions

Social impacts constitute what part of Rands' Model of CSP

outcomes

Which of the following effects did the Citizens United v. Federal Elections Commission have on campaign financing?

permitted for the first time businesses and union efforts to make direct contributions to the campaigns of candidates for elected office

An analysis of the stability or instability of a government is basically an example of scanning the:

political environment.

In link #4, "General Mills' Palm Oil Policy," the company recommitted to using 100% sustainably sourced palm oil. Which of the tactical arena of response - posture of response combination does this most appear to represent, based on the discussion of these in Rands' CSP model?

process - problem solving

Which of the following is NOT one of the criteria that is suggested by Lawrence and Weber as contributing to how salient a stakeholder is to a firm?

proximity

Which of the following best describe the three strategies of globalization explained in the text as develop global market channels, locate global operations in other countries, and develop global supply chains?

sell, make, source

Which of the following (a-d) is NOT a way that President Trump's various policies might affect the future of globalization, according to the authors of the required reading on this topic?

spur increased amounts of foreign direct investment by U.S. based companies

The principles of corporate citizenship listed in Exhibit 7.A found in the slides emphasize that business must balance the needs of all

stakeholders

According to the powerpoint slides, the type of regulatory reform that most directly changes regulations themselves is

substantive

Which of the global social audit standards mentioned in the text and summarized in Figure 7.2 in the slides has as its focus the issues of human rights, labor and the environment?

the United Nations Global Compact

Which of the following statements is MOST accurate regarding the "Should E-Cigarettes Be Regulated Case" in Lawrence and Weber?

the actions taken by e-cigarette makers appear to be consistent with reducing inadequate information

The notion of a "revolving door" refers to

the fact that many former elected officials and legislative staff members find employment with lobbying firms or their business client organizations

Which of the following statements (a-d) regarding social reporting is NOT accurate?

the vast majority of firms surveyed by KPMG in 2013 have integrated their financial and social reports into one single report

Which of the following four statements (a-d) is NOT a benefit of social audits identified by Simon Zadek, as mentioned in Lawrence and Weber?

they help government regulators know which companies are acting irresponsibly and therefore don't need to be inspected