Chapter 4
Publicity efforts that portray a company as being environmentally friendly when its actions speak otherwise are called ________.
greenwashing Environmental activists use the term greenwash as a label for publicity efforts that present companies as being environmentally friendly when their actions speak otherwise.
Which of the following approaches to resolving ethical dilemmas advocates choosing the option that delivers the most good for the most people?
utilitarianism Utilitarianism involves choosing the option that delivers the most good for the most people (or protects the most people from a negative outcome).
Which of the following is true about the Americans with Disabilities Act (ADA)?
It guarantees equal opportunities in housing, transportation, education, employment, and other areas for people with disabilities. The federal Americans with Disabilities Act (ADA) guarantees equal opportunities in housing, transportation, education, employment, and other areas for people in the United States with disabilities.
Conflicts of interest involve business decisions that might be influenced by the potential for personal gain.
True
President John F. Kennedy announced a "bill of rights" for consumers, laying the foundation for a wave of consumer-oriented legislation.
True
Seeking the greatest good for the most people is utilitarianism
True
Which of the following federal legislations limits cardholder liability for unauthorized use?
Truth in Lending Act (Consumer Protection Credit Act) (1968) Truth in Lending Act (Consumer Protection Credit Act) (1968) requires creditors to disclose finance charge and annual percentage rate, and limits cardholder liability for unauthorized use.
The manager of a golf course awards a landscaping contract to his brother-in-law's company, even though another company was willing to do the same work for less money. This is an example of ________.
conflict of interest Conflicts of interest refers to situations in which competing loyalties can lead to ethical lapses
Shopper's Paradise, a department store chain, was accused of working with contractors who use sweatshop labor in their manufacturing units. The company was labeled as promoting unethical business policies. To deal with these criticisms, the company decides to make a large donation to a cancer research foundation, as well as sponsor a health awareness program in the community. Shopper's Paradise would be said to have a ________ approach to CSR.
defensive Many companies find themselves facing pressure from a variety of activists and nongovernmental organizations (NGOs). One possible response to this pressure is to engage in CSR activities as a way to avoid further criticism, which is termed as defensive CSR.
A situation in which you must choose between two conflicting but arguably valid alternatives would be known as a(n) ________.
ethical dilemma An ethical dilemma is a situation in which you must choose between conflicting but arguably valid options, or even situations in which all your options are unpleasant.
The CEO of a pharmaceutical firm learns that the FDA is going to deny approval for one of the company's drugs. He knows this will have a negative effect on the company's stock, so he quickly tells his broker to sell all of his shares of stock in the company before the news is announced. This is an example of ________.
insider trading The use of unpublicized information that an individual gains from the course of his or her job to benefit from fluctuations in the stock market is called insider trading.
Facebook was criticized for a behind-the-scenes attempt to generate public outrage regarding alleged privacy violations by Google. The company used a public relations agency to encourage bloggers and the news media to write critical stories about Google. In this example, Facebook was criticized because ________.
it lacked transparency Business communication ethics often involve the question of transparency, which can be defined as the degree to which information flows freely within an organization, among managers and employees, and outward to stakeholders.
A leading pharmaceutical company found that a newly launched, over-the-counter drug might have certain negative side effects such as mood changes, that were not identified during the clinical trials. To avoid unnecessary losses, the company does not inform public about the probable side effects. In this example, the company ________.
lacked transparency Business communication ethics often involve the question of transparency, which can be defined as the degree to which information flows freely within an organization, among managers and employees, and outward to stakeholders.
John, a business owner, refuses to contribute to social causes. He argues that he is an honest, law abiding businessman who never evades his taxes. He states that by providing good quality products at a fair price, he has fulfilled his company's obligation to society. John would be said to have a ________ approach to CSR.
minimalist According to the minimalist view, the only social responsibility of business is to pay taxes and obey the law.
LK Manufacturing Group, a company that manufactures home appliances, supports a community sports center to nurture the city's athletic talent as well as promote fitness activities, without regard for any direct business benefits. This exemplifies ________.
philanthropy Philanthropy involves donating money, employee time, or other resources to various causes without regard for any direct business benefits for the company.
Since its inception, Whole Foods Market has contributed 5% of its profits to charitable endeavors. At Whole Foods Market, company leaders believe they have responsibilities beyond making a profit. The firm has a ________ approach to CSR.
proactive In proactive CSR, company leaders believe they have responsibilities beyond making a profit, and they back up their beliefs and proclamations with actions taken on their own initiative.
Aston Products Inc., a cosmetic research, development, and manufacturing firm, conducts a cost-benefit analysis that identifies an underdeveloped area which has cheap labor and low land costs. The firm decides to set up a factory in that area to take advantage of the lower land and labor costs. While setting up the factory, the company also develops infrastructure such as building roads, hospitals, and primary schools. This is an example of ________.
strategic CSR Strategic CSR involves social contributions that are directly aligned with a company's overall business strategy.
Corporate social responsibility refers to ________.
the notion that business has obligations to society beyond the pursuit of profits Corporate social responsibility (CSR) is the notion that business has obligations to society beyond the pursuit of profits.
The products of Sports Center, an international sports footwear and apparel chain, are manufactured in sweat factories in China. According to the company president, using sweatshop labor is justified because it delivers the most good for the most people. He mentions that it offers a means of livelihood to children and young adults, as well as supplies good quality apparel to customers at a lower cost. In this example, the president of Sports Center uses which of the following ethical approaches to decision making?
utilitarianism Utilitarianism involves choosing the option that delivers the most good for the most people (or protects the most people from a negative outcome).
Which of the following ethical approaches emphasizes desirable character traits such as integrity and compassion?
virtue Virtue emphasizes desirable character traits such as integrity and compassion.
A company insider's disclosure that exposes illegal or unethical behavior by others within the organization is ________.
whistle-blowing Whistle-blowing refers to the disclosure of information by a company insider that exposes illegal or unethical behavior by others within the organization
An employee at Cleveland Medical Center informs the media of certain health law violations and negligence that lead to documented illness and even death in certain cases. This is an example of ________.
whistle-blowing Whistle-blowing refers to the disclosure of information by a company insider that exposes illegal or unethical behavior by others within the organization.
________ is the study of the relationship between organisms and the natural environment.
Ecology Ecology is the study of the relationship between organisms and the natural environment.
Companies that engage in cynical CSR believe that the only social responsibility of business is to pay taxes and obey the law.
False
One of the fundamental consumer rights that form the basis of much of the consumer-related legislation in the United States is the right to know the lowest available price of a good in the local market.
False
Philanthropy involves social contributions that are directly aligned with a company's business strategy.
False
The term "disability," as used in the federal Americans with Disabilities Act, means only those people with physical handicaps, such as hearing or vision loss or loss of mobility.
False
Activities undertaken by businesses to recruit and promote members of groups whose economic progress had been hindered through either legal barriers or established practices are known as ________.
affirmative action Affirmative action programs were developed to encourage organizations to recruit and promote members of groups whose past economic progress has been hindered through legal barriers or established practices.
Which of the following is true about strategic CSR?
It involves social contributions that are directly aligned with a company's overall business plans. Strategic CSR involves social contributions that are directly aligned with a company's overall business strategy.
Which of the following statements is true regarding ethical decision making?
Stakeholders' needs often conflict, requiring managers to make tough decisions about resource allocation. An ethical dilemma is a situation in which you must choose between conflicting but arguably valid options, or even situations in which all your options are unpleasant. Stakeholders' needs often conflict, requiring managers to make tough decisions about resource allocation.
Cap and trade programs try to balance free-market economics with government intervention
True
Widespread concern for the environment dates to the 1960s when ecology entered mainstream discussion.
True
________ is defined as meeting the needs of the present without compromising the ability of future generations to meet their own needs.
Sustainable development Efforts to minimize resource depletion and pollution are part of a broader effort known as sustainability or sustainable development, which the United Nations has defined as development that "meets the needs of the present without compromising the ability of future generations to meet their own needs."
________ refers to the degree to which information flows freely within an organization, among managers and employees, and outward to stakeholders.
Transparency Transparency can be defined as the degree to which information flows freely within an organization, among managers and employees, and outward to stakeholders.
Most of the electricity generated in the United States is produced by ________.
burning fossil fuels Most of the electricity generated in the United States is produced by burning fossil fuels. Nuclear and hydroelectric power provide most of rest.
Under ________, lawmakers establish maximum allowable amounts of a pollutant that an industry is allowed to emit and distribute individual allowances to all companies in that industry
cap and trade Cap and trade programs try to balance free-market economics with government intervention. Lawmakers first establish a maximum allowable amount of a particular pollutant that a designated group of companies or industries is allowed to emit and then distribute individual emission allowances to all the companies in that group.
A ________ CSR is one in which a company accused of irresponsible behavior promotes itself as being socially responsible without making significant improvements in its business practices.
cynical A purely cynical response to CSR is one in which a company accused of irresponsible behavior promotes itself as being socially responsible without making substantial improvements in its business practices.
Mark hacks into the database of an e-commerce firm and steals the social security numbers of many of its customers. He then uses these numbers to take loans. This is an example of ________.
identity theft Identity theft refers to crimes in which thieves steal personal information and use it to take out loans and commit other types of fraud.
Nongovernmental organizations are ________.
nonprofit groups that provide charitable services or promote causes Nongovernmental organizations (NGOs) are nonprofit groups that provide charitable services or promote social and environmental causes.
________ refers to a written statement setting forth the principles that guide an organization's decisions.
Code of ethics Code of ethics refers to a written statement setting forth the principles that guide an organization's decisions. It defines the values and principles that should be used to guide decisions