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
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
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
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
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
exacting culture
high concern for performance, less about people
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.
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
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.
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
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
____________ 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
An effective team should possess which characteristic?
Diversity
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
Ethical Philosophies
Utilitarian / Consequenstialism, Deontology, Virtue, Principle, Egoism
Which of the following is an important part of an organizational culture?
Values
Which of the following is part of the discovery process?
assessment