Ethics Study Terms CHP 1-4

Shareholder model of corporate governance

-Maximizing wealth for investors and owners -focuses on developing and improving the formal system for maintaining performance accountability between top management and the firms shareholders -drives a firms decisions toward serving the best interest of investors

Implementing Stakeholder Perspective

1. Assessing the corporate culture 2. Identifying stakeholder groups 3. Identifying stakeholder issues 4. Assessing organizational commitment to social responsibility 5. Identifying resources and determining urgency 6. Gaining stakeholder feedback

Reputation

An idea held by the public about something or someone

Social Responsibility

An organization's obligation to maximize its positive impact and minimize its negative impact on society

Principles

Basic beliefs, rules, or laws

This is a leading self-regulatory body that provides directions for managing customer disputes and reviews advertising cases.​

Better Business Bureau

_____ is the offering of something of value in order to gain an illicit advantage.

Bribery

_____ law defines the rights and duties of individuals and organizations (including businesses).

Civil

Which of the following is a major ethical concern among corporate boards of directors?

Compensation

Business Ethics

Comprises organizational principles, values, and norms that may originate from individuals, organizational statements, or from the legal system that primarily guide individual and group behavior in business

What type of fraud involves intentional deception on the part of an individual or group in order to derive an unfair economic advantage over an organization?

Consumer

_____ focus(es) on developing sound organizational practices and integrity for financial and nonfinancial performance measures, rather than on an individual's morals.

Core practices

_____ law not only prohibits specific actions in business such as fraud, theft, or securities trading violations, but also imposes fines or imprisonment as punishment for breaking the law.

Criminal

Which of the following are not typically secondary stakeholders?

Customers

____________ must be trusted to make business work properly and includes accountants.

Gatekeepers

Investors

Groups of individuals who invest their money in various types of companies in search of making a profit

Which of the following is not a side-effect of being the victim of workplace bullying?

Increased productivity

Concerns involving copyright infringement on books, movies and music, and other illegally produced goods relate to which type of ethical issue?

Intellectual property rights

Investor Loyalty

Investors are aware of the contributions of ethical conduct in providing a foundation for efficiency, productivity, and profits in a firm

The term business ethics is best described by the following statement:

It comprises the principles, values, and standards that guide behavior in the world of business.

Abusive or intimidating behavior is the most common ethical problem for employees. Which of the following is not related to this concept?

Performance probation

_____ is the synergistic and mutually beneficial use of an organization's core competencies and resources to deal with key stakeholders so as to bring about organizational and societal benefits.

Strategic philanthropy

Profit

The financial gain made in a transaction

Why is the public more tolerant of consumer misconduct than business misconduct?

There are big differences in wealth and success between businesses and consumers.

Why is it important for businesses to recognize secondary stakeholder groups?

They have legitimacy and can exert power.

Which of the following are not typically primary stakeholders?

Trade associations

_____ responsibilities relate to a business's contributions to stakeholders.

Voluntary

How do violations of the law usually start?

When businesspeople stretch the limits of ethical standards

Corporate Social Responsibility

a business's concern for society's welfare

Executive compensation

a governance mechanism that seeks to align the interests of managers and owners through salaries, bonuses, and long-term incentives such as stock awards and options

Board of Directors

a group of persons elected by the stockholders to manage a corporation

The degree to which a firm understands and addresses stakeholder demands can be referred to as

a stakeholder orientation.

Optimization is defined as

a trade-off between equity and efficiency.

Stakeholders' power over businesses stems from their

ability to withdraw or withhold resources.

Ethical Culture

acceptable behavior as defined by the company and industry

Ethical culture is defined as

acceptable behavior as defined by the company and industry.

Conflicts of interest exist when employees must choose whether to

advance their own personal interests, those of the organization, or those of some other group.

Primary stakeholder

any group on which an organization relies for its long-term survival. May include customers, employees, stockholders, creditors, suppliers, or anyone else with a functional or financial interest in the product or situation.

Business ethics is a part of decision making

at all levels of work and management.

The term used to express how a firm meets its stakeholder expectations of its economic, legal, ethical, and philanthropic responsibilities is

corporate citizenship.

Employee Commitment

development of an ethical culture leads to employee retention and loyalty, which increases employee performance

Which of the following describes the four levels of social responsibility?

economic, legal, ethical, and philanthropic

Values are

enduring beliefs and ideals that are socially enforced.

Issues related to fairness and honesty may arise because business is sometimes regarded as a

game governed by its own rules rather than those of society.

Secondary stakeholder

have an indirect relationship with a company. They tend to not be employees or directors and don't have any direct engagement with a company, but can still be influential.

The _____ of ethics involves embedding values, norms, and artifacts in organizations, industries, and society

institutionalization

Investors are concerned about business ethics because they know that misconduct can

lower stock value and prices.

The purpose of a stakeholder orientation is to

maximize positive outcomes that meet stakeholder needs.

Compensation

payment for working

When a commercial states that a product is superior to any other on the market, the marketer risks accusations of

puffery.

Morals...

relate to you and you alone.

Ethical Climate

represents employees' perceptions about the extent to which work environments support ethical behavior

An ethical issue is a problem, situation, or opportunity

requiring an individual, group, or organization to choose among several actions that must be evaluated as right or wrong, ethical or unethical.

Many people wrongly assume that a company will be ethical if it

simply hires ethical employees

Principles are

specific and pervasive boundaries for behavior that are universal and absolute.

Those who have a claim in some aspect of a firm's products, operations, markets, industry, and outcomes are known as

stakeholders.

The study of business ethics is important to better understand all of the following except

that business ethics is entirely an extension of an individual's own personal ethics.

Customer Satisfaction

the extent to which a product's perceived performance matches a buyer's expectations

Corporate citizenship

the extent to which businesses meet the legal, ethical, economic, and voluntary responsibilities placed on them by their stakeholders

Values

the ideas, beliefs, and attitudes about what is important that help guide the way you live

Social Responsibility

the obligation of a business to contribute to society

Ethics

the principles of right and wrong that guide an individual in making decisions

Corporate governance

the system of governing a company so that the interests of corporate owners and other stakeholders are protected

Donation of computer equipment to schools by Toshiba would be associated with _____ responsibilities.

voluntary