Business Ethics Final

Common Reasons and Rationalizations

everyone does it, it isn't a big deal, not my responsibility or "just following orders", knowing it isn't fair to the customer but not wanting to hurt team, or just this one time

exacting culture

high concern for performance, less about people

An effective ethics program should show _____________________.

intolerance of misconduct

What is a disadvantage of small group communication and decision making?

it can lead to excessive risk taking

Apathetic Culture

Minimal concern for people or performance

Values

some values most people share in common

Normalization

Approach ethical issues calmly, like they are a normal part of business

Virtue Approach

Be the best person you want to be, acting consistent with values and morals

Why might listening be just as important as speaking for an ethical leader?

It can establish credibility and increase morale among employees.

Early 70s

Watergate → Increased ethics training for lawyers

Purpose

What do you stand for? What are the overarching values that guide your personal and professional life?

Self-Knowledge and Alignment

What is the best way to communicate your concerns? Formulate preferences, styles, etc into useful tools

Which of the following statements about nonverbal communication is false?

It is less trustworthy than verbal communication.

Principle Approach

Using the DFEI principles

Types of culture

apathetic, caring, exacting, integrative

Which leadership style is likely to be ineffective at promoting ethical conduct?

coercive

An effective team should possess which characteristic?

Diversity

Early 00s

Enron, WorldCom, Tyco, → Sarbanes-Oxley Act, 2004 Sentencing

How can ethical leaders increase employee empowerment?

Make discussions about ethics commonplace.

Separating the people from the issue in an ethical conflict situation allows the leader to approach the conflict situation with more __________.

objectivity

In a rigid hierarchical organization, communication generally consists of ______________.

one-way communication

Ethical leaders should consider their employees to be ____________ in contributing to the firm's values.

partners

Voice on the Fly

It is rarely now or never, if you can address it then do, or return to it later, or request more information

Ethical Philosophies

Utilitarian / Consequenstialism, Deontology, Virtue, Principle, Egoism

Which of the following is a barrier to communication between leaders and followers?

Power Differentials

Why might ethical conflicts be important to an ethical culture?

Ethical conflicts can be used to identify ethical issues.

Reasons and Rationalizations

Prepare for rationalizations people will offer

What does external whistle blowing often indicate about a firm's corporate culture?

Internal reporting is perceived to be ineffective.

Training employees in leadership techniques _________________.

is a form of employee empowerment

Ethical Egoism Approach

Concerned with self interest

Which characteristic best describes a mixed-motive approach to handling conflict?

collaborating

integrative culture

High concern for people and performance

Why is the collaborating style of management most favorable to ethical conflict resolution?

Leaders desire to meet the needs of others but adhere to their own goals and values.

11 steps of creating a culture of doing the right thing

1. have a higher purpose than just making money 2. clear set of principled 3. communicate principles in a positive way 4. commitment from senior leadership 5. seniors leaders hold themselves and others accountable 6. secure way for employees to express concerns 7. hire for character as well as skill 8. evaluate employees for values as well as skill 9. incentivize good behavior 10. measure culture with surveys and interviews 11. invest in employees

Which of the following factors impact the length of time it takes for companies to recover from ethical misconduct?

All three answer options impact the length of time it takes for companies to recover

____________ occurs when both the communicator and receiver considers the unique worth of the other party and tries to understand what the other is communicating.

Dialogue

RADAR

Recognize ethical issues Avoid misconduct whenever possible Detect ethical risk areas Answer stakeholder concerns when an ethical issue comes to light Recover from a misconduct disaster by improving upon weaknesses in the ethics program

__________ occurs when ethical leaders observe and identify ethical risk areas.

Recognizing

Late 80s

Savings and Loan Crisis & Junk Bonds → 1991 Federal Sentencing Guidelines for Organizations

What should an ethical leader do in managing an ethical dilemma?

Select the most desirable path in a situation in which no decision is optimal.

What does an effective ethics program require?

Support from top management and frequent communication with employees

According to most companies' ethics codes, what happens to whistle blowers if their reportings are wrong?

They do not face retaliation for good faith reporting.

Why are managers reluctant to engage in the discovery process?

They fear uncovering misconduct could harm the firm's reputation.

Giving Voice to Values

doesn't focus on ethical analysis, but assumes we have already analyzed the situation and ask "if i were going to act on my values, what would I say and how could I be most effective?"

What is the first step toward making an ethical decision?

identifying the ethical issue

When handling a conflict situation, it is important for a leader to realize that the other party's concerns are _________.

legitimate

According to the information shared in this section, ________ might provide a solution to a disagreement, but it is unlikely that both parties will be happy with the decision.

litigation

Which situation demonstrates reciprocity?

In response to co-workers help making a deadline, you assist them with a similar crisis

Which mediation skill is important for an ethical leader to have in a conflict situation?

use of neutral language

Brand

what people think of when they think of you

7 pillars of GVV

values, choice, normalization, purpose, self-acknowledgement and alignment, voice, reasons and rationalizations

What should an ethical leader do if a conflict begins to escalate?

Bring the discussion back to the core issues.

Which statement about organizational ethical role models is true?

Co-workers can be ethical role models, especially when the manager is distant.

Voice

Don't go in blind, practice explaining your concerns

What do all effective ethical leaders share in common?

Good communication skills

caring culture

High concern for people; minimal concern for performance

Late 00s

Housing Market / Subprime Mortgage Crisis and Lehman Brothers → Dodd Frank Act

What is the best way to avoid an ethical misconduct disaster?

Identify a potential ethical issue before it snowballs into a crisis.

Why is the mixed-motive conflict management style considered to be the most effective?

It bases decisions on the goals and values of the firm

Which statement is true about employee feedback?

It helps leaders identify the firm's strengths and weaknesses.

Why would organizations prefer that employees provide their personal information when making reports?

It is easier to handle a conflict situation when all parties have been identified.

What is the problem with an accommodating style of conflict management?

Leaders might allow unethical employees to continue their misconduct.

Why are leaders important even in a democratic organization?

Leaders often make the final call on major decisions.

Utilitarian / Consequentialism Approach

Produce the most good for the most people to do the least amount of harm

How might a comprehensive code of conduct prove ineffective in curbing misconduct?

The code of conduct is not effectively communicated to employees.

When might a zero-sum conflict approach be necessary?

When compromise would break a law.

What is group polarization?

When the group moves toward a more extreme position than what each member would have done individually.

Why is external whistle blowing a serious decision?

Whistle blowers have been fired for reporting.

As a lower-level employee, how might you be able to ethically influence new hires?

You can communicate organizational principles and values.

Which of the following is part of the discovery process?

assessment

How do you build your brand

decisions and choices you makes

An ethical leader with good interpersonal communication skills should ____________.

demonstrate both respect and firmness in communication

Which of the following is important in catching misconduct internally before it becomes a major issue?

employee feedback

Leaders with an avoiding conflict management style are more likely to exhibit ______________.

ethical complacency

Choice

everyday we act or don't act on values. Identify enablers and disablers to be provide

Good communication skills __________.

promote leader-follower congruence

Which of the following is a step companies take in the recovery process?

reinforcing the firm's reputation with positive messages

Rita Crundwell

stole $54 million to maintain competitive horses and lavish lifestyle through wire fraud- lack of internal and institutional controls She was a treasurer in Dixon

What is a potential downside of overusing the compromising style of conflict management?

Each side has to give something up.nt?

Which of the following is true about dissent in organizations?

Ethical cultures are likely to have strong internal dissent mechanisms.

1991 Federal Sentencing Guidelines

FSGO do not require companies to establish ethics & compliance programs, but offer significant leniency in penalties if companies are convicted of federal crimes and have such programs Specifies core elements of qualifying programs (Seven Steps): 1. Establish Policies, Procedures and Controls 2. Exercise Effective Compliance and Ethics Oversight 3. Exercise Due Diligence to Avoid Delegation of Authority to Unethical Individuals 4. Communicate and Educate Employees on Compliance and Ethics Programs 5. Monitor and Audit Compliance and Ethics Programs for Effectiveness 6. Ensure Consistent Enforcement and Discipline of Violations 7. Respond Appropriately to Incidents and Take Steps to Prevent Future Incidents

What is one of the disadvantages higher-level executives face when overseeing an ethical climate of the organization?

Their tendency to be socially isolated from employees

What do zero-sum leaders believe?

There always has to be a winner and a loser in a conflict situation.

What actions can teams take to aid in the ethical decision making process?

Collectively look for ethical solutions or alternatives

1996 Caremark Decision

Company Directors are potentially liable for a breach of duty to exercise appropriate attention if they knew or should have known that employees were violating the law, declined to make a good faith effort to prevent the violation, and the lack of action was the proximate cause of damages • Incentivizes internal compliance protocols to reduce liability risks

Which of the following statements is true regarding organizational conflict?

Conflicts provide an opportunity to listen to the other party's viewpoints.

80s

Defense Industry Procurement Scandal → Defense Industry Initiative

How should ethical leaders manage their employees?

Demonstrate ethical values through role modeling

To help prevent misconduct, ethical leaders should:

Develop and manage systems to maintain an ethical culture

Deontology Approach

Follow the rules regardless of the consequence

Why is an organization characterized by workplace politics perceived negatively by employees?

Followers are rewarded based on whether they serve the leader's best interests.

Late 70s

Foreign Corruption and Bribery → FCPA

What should an employee do after discovering illegal conduct?

Immediately report to your immediate supervisor.

Jack Abramoff

The most influential lobbyist in Washington D.C. responsible for millions of dollars of campaign donations to over 200 congressmen

Which statement best describes how autocratic leaders communicate?

They limit communication to need-to-know information.

What is a downside to being a variable-sum leader?

They might give in to employees making unethical decisions.

What might be true of leaders who adopt a competing style of conflict management?

They score high on assertiveness.

According to Ethics Consultant, David Gebler, most unethical behavior is committed ______________.

To meet performance goals

Which of the following is an important part of an organizational culture?

Values

In order to promote an open communication culture, leaders should ____________________.

adopt more of a democratic process toward ethical decision making

What does mediation involve?

an objective third party helps two parties settle their differences

Dr. Dan Ariely

committing a dishonest act in one area of your life not only leads to more dishonesty in that one area, but ends up corrupting other areas of your life as well