CH. 5 Study set International Business

Which two groups are most likely to be considered the external stakeholders of a firm?

Customers and Suppliers

Which aspect of international business convinced Leon Sullivan to lead the way in eliminating apartheid in South Africa?

Ethics

The theory that states that businesses should not incur social expenditures unless required by law or required for the efficient operations of a business is the ______.

Friedman Doctrine

According to the Sullivan principles, what two conditions were GM required to fulfill in order to continue to operate in South Africa?

GM should do everything possible to promote the abolition of apartheid laws. GM could not obey the apartheid laws in its own South African operations.

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

Internal

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

Rights

The effects of corruption on a company's economic growth have resulted in many multinationals to adopt

a zero tolerance policy

Our personal ethics tell us it is wrong to cheat on a test. Conversely, it is right to

accept responsibility for your actions.

The Universal Declaration of Human Rights has been ratified by ______.

almost every country

International businesses frequently have to address ethical issues that develop because

countries have different business laws, practices, and regulations.

The ______ believes it is always the appropriate strategy to adopt home-country ethical standards.

righteous moralist

According to Milton Friedman, what is the social responsibility of a business?

to increase profits

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

violated basic human rights

Which maxim accurately summarizes the concept of cultural relativism?

when in Rome, do as the Romans do

What are the next four steps a company should take in the decision-making process once it has identified its stakeholders? List the steps in the correct order, starting with step two at the top of the list.

1. Judge the ethics of the proposed decision 2. Establish moral intent 3. engage in ethical behavior 4. audit the decisions

What are two problems with the utilitarian approach to business ethics?

1.Accurately measuring the costs and benefits of a given situation 2.Doesn't consider justice

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

1.Build an organizational culture that values ethical behavior. 2.Favor hiring and promoting of people with a sense of personal ethics. 3.Implement decision-making processes that consider ethical aspects of business decisions.

According to Rawls's view of justice, when people operate under a veil of ignorance, they would unanimously agree on two fundamental principles of justice. What are these two principles?

1.Each person is permitted the maximum amount of basic liberties compatible with a similar liberty for others. 2.Once basic liberty is ensured, inequality in basic social goods is to be allowed only if such inequalities benefit everyone.

The straw men approach to ethics is comprised of four approaches. What are those four approaches?

1.Friedman doctrine 2.Righteous moralist 3.Cultural relativism 4.Naive immoralist

What are four of the determinants of ethical behavior?

1.Leadership 2.Personal ethics 3.Organizational culture 4.Societal culture

The introduction of democratic elections in the ______ led to the eventual demise of the apartheid system in South Africa.

1990s

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

Algorithms

In some countries, bribes are considered appropriate in business. In other countries, bribes are against the law. This is an example of

An ethical dilemma

______ ethics measure actions on a cost-benefit scale.

Utilitarian

The police have located a suspect in a dirty bomb threat to a major city. They plan to do whatever is necessary to locate the bomb -- including torture. Which approach to ethics are the police using in this situation?

Utilitarianism

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

The ______ of a company reflect what the company believes to be good, right, and desirable.

Values

What is the focus of the justice theories?

a fair distribution of economic goods and services

According to Rawls's theory of justice, all economic goods and services should be distributed equally except when ______.

an unequal distribution would provide everyone with an advantage

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

apartheid system.

Which step in the decision-making process is often overlooked by companies?

audit the decision

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.

Ethical issues arise in international business when

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

Which statement BEST explains how a manager's personal ethics might be challenged in international transactions?

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

An amendment to the Foreign Corrupt Practices Act allowed for the use of ______ which allow a business to receive the standard treatment it ought to receive from a foreign government.

Facilitating payments

True or False: The study in the text confirms that corruption had a small but positive impact on a country's economic growth rate.

False

True or false: Organizational culture refers to the system used to create job levels and hierarchies within a company.

False

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

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

Foreign Corrupt Practices Act

Companies that decide to relocate their production activities to a nation where there are fewer environmental regulations which allows the company to dump production waste into rivers are contributing to the

Global Tragedy of Commons

After US companies objected that the Foreign Corrupt Practices Act would put them at a competitive disadvantage, the FCPA was eventually amended to allow for ______.

Grease payments

Which of Hofstede's dimensions are likely to be found in nations where corruption is rampant?

High power distance

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. Finally, Bennie is told that if he starts offering "daily cash bonuses" to employees, they will meet their targets. He is torn between doing what he believes is right and meeting his numbers. Bennie is facing a challenge to ______.

His Personal Ethics

The righteous moralist says that a multinational's ______ country standards of ethics are the appropriate approach to follow in foreign countries.

Home

Because ______ violations were so prevalent in Myanmar in the 1990s, many Western companies could no longer condone doing business there.

Human Rights

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 doesn't do this because she knows that while paying the bribe would ensure large profits, doing so would be unethical. Maria is demonstrating ______.

Moral courage

To ensure that the business has appropriate legal compliance programs and acts in an ethical manner, some firms now have created a position for a(n) ______ officer. Ethics What characteristic helps managers walk away from a decision that is profitable, but not ethical?

Moral courage

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 ______.

Moral immigration

Which well-known advocate for human rights was elected president of South Africa following the apartheid movement in South Africa?

Nelson Mandela

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

Noblesse oblige

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 accepted standards or ways of doing things in a particular setting are known as

Norms

Today, Freedom House ranks Myanmar as

Not free

The basic principles and values that govern interactions between individuals are known as

Personal Ethics

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 working conditions situation is generally MOST preferred?

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

James is a manager from Tennessee working at 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 one employee and hiring his neighbor at a lower rate. James confronts his assistant manager, claiming this behavior isn't consistent with home-country standards. Which philosophical approach to ethics does James represent?

Righteous moralist

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

Straw men

A strategy that not only helps a multinational firm make a good profit, but does so without harming the environment while simultaneously ensuring that the company acts in a socially responsible manner toward its stakeholders is referred to as a(n) ______ strategy.

Sustainable

The Universal Declaration of Human rights was adopted by the ______ and is a global expression of what many believe are the rights to which all human beings are inherently entitled.

United Nations

Sharon is visiting her company's manufacturing subcontractor in Pakistan. She is disturbed when she notices children working on the machinery in a room with no air conditioning and little access to water, but she also knows these children are probably supporting their families. This is an example of a(n) ______.

ethical dilemma

A system of moral principles that govern the conduct of an individual is known as

ethics

In order to expedite routine government actions, what was specifically excluded from the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions?

facilitating payments

Roboton Inc. moved its production facilities to a new nation where it freely dumps its harmful waste in the rivers and causes environmental degradation. In this case, Roboton has contributed to the

global tragedy of the commons

The main criticism of the righteous moralist approach is that

its supporters go too far. The home-country standards are not always applicable.

Marion, 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. Marion's behavior reflects the ideas of a ______.

naive immoralist

The __ believes that if a multinational firm does not follow the ethical norms of the host country, then other multinational firms don't have to follow them.

naive immoralist

Rights such as freedom of association and freedom of speech are

not universally accepted

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.

What do scientists believe occurs as the result of the increasing amount of carbon dioxide in the atmosphere?

the carbon dioxide reflects heat back to the earth's surface and the earth's temperature increases

Maria has decided to send a letter to her state representative regarding the ten industrial plants in her community that release toxic emissions into the air which could create health problems in the future for families living in the area. What phenomenon is Maria concerned with?

tragedy of the commons

Jennifer doesn't understand why the management team decided to continue supporting the supplier in India when it was obvious that a better product at a better price was available from a supplier in Indonesia. According to the text, what is the best starting point to understand this decision?

understand the process the management team uses to make decisions

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

Heidi told her husband that there was no possible way she could meet her monthly sales goal now that her manager had doubled it. She decided the only way to make the new goal was to add 5% to every sales order and hide this cost under "personal needs" when she submitted her report. What is causing Heidi to act in this unethical manner?

unrealistic performance goals

The managers of ABC Manufacturing are struggling to meet their increased quota. They decide to eliminate two quality control steps in the manufacturing process in order to meet the demand. This is unethical behavior that was a result of

unrealistic performance goals.

True or false: According to the rights theories, human beings have fundamental rights and privileges that transcend national boundaries.

True

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

True

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 justice theory attributed to ______ emphasizes the socially just distribution of goods in society.

John Rawls

When Byron Manufacturing decided to recycle component parts, it not only saved the company money, it also limited the amount of waste it sent to landfills. This decision reflects the idea of ______.

CRS (corporate social responsibilities)

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

Carbon Dioxide

Giving people that which they are due is an example of a(n) __ distribution. Just 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

According to the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, the bribery of a foreign public official is considered a(n)

Criminal Offense

Organizational ______ is the name given to 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

What human characteristic did Immanuel Kant use as the basis of his ethical theory?

Dignity

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

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 countries which score high on masculinity and power distance measures.

Ethical

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

Ethical dilemmas

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

Ethics officer

Jeff is a manager at a toy manufacturing facility. Which of these situations demonstrate how Jeff uses his moral imagination?

Jeff decided not to outsource parts to a company in Asia because he knew the company used small children as laborers.

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

Justice

A(n) ______ distribution is one that is considered fair and equitable. Just ______ ethics holds that one should always respect others and act in accordance with rules that could apply to everyone.

Kantian

What is one thing a company must have in order to build an organizational culture that emphasizes ethical behavior?

The business must explicitly articulate values that emphasize ethical behavior.

Garrett Hardin described how herders shared common land for grazing. It was advantageous to the poor to place more and more livestock on the common land 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 hired?

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

What was taking place in South Africa when the apartheid system was dominant?

There was mandated segregation between whites and blacks/nonwhites.

What is an accurate description of developed nations in terms of the environment?

They have more substantial environmental regulations.