Chapter 9 Chapter Quiz

When performing an investigation, an ombudsman has access to all company employees. True False

True

Being a virtuous, approachable manager shows high moral development and reasoning, but ultimately makes is more difficult to run a business due to ethical complications. True False

False

It is important for managers to maintain an appearance of ethical perfection, because if employees suspect the manager has done something unethical, they likely will too. True False

False

You know that your company's internal procedures are inadequate to address fraud because the relevant managers are unable or unwilling to act to stop company fraud. You now face the decision of whether or not to blow the whistle on your company to stop the fraud that is happening. Which course of action is best? You should not blow the whistle because protecting one's company from harm and public scrutiny should be paramount for every employee. You should not blow the whistle because whistlebl

You should blow the whistle because it is the most ethical thing to do, even if you face consequences as a result of your actions.

A person with moral courage will be more likely to report unethical behavior. True False

True

You are a manager at a paper supply company. One of your employees self-reports to you that they have been trading personal favors with a supplier in order to receive discounts for the company. You see this is clearly unethical behavior. Which of the following responses would be best? "I've valued you as an employee, but in order to make sure that people know unethical behavior is serious I need to terminate your employment." "This sort of thing hasn't happened with you before, so this

"You're a good employee, so I'm surprised that you would do this. Help me understand how this happened."

Most employees fail to report unethical behavior when they witness it. True False

False

An authoritarian leader stresses loyalty to a code of ethics rather than loyalty to hierarchy. True False

False

You and your neighbor are good friends, work at the same company, and drive to the office together each day. One day in conversation, your friend mentions that he has been getting information from a friend at a different company that guides the way he invests company money. You recognize this as insider trading. When he mentions this you don't say anything, but later decide that something must be done. Which of the following is your best response? Speak to an outside source immediately, such a

Talk with him about his misconduct first and make sure he reports it to his boss.

Companies attempt to detect fraud in various ways, but survey data shows that fraud is most often detected through ______. external whistleblowers tips management interviews of employees ethics training

tips

The greatest difference between whistleblowing and reporting to an ethics and compliance officer (ECO) or ombudsman is ______. how your actions are viewed by others who is reporting the ethical offense who you report misconduct to how frequently the offenses are reported

who you report misconduct to

An ethics and compliance officer should maintain close friendships with management and senior staff. True False

False

An employee feels anxious that the ethics assist line will be used to generate false reporting from a spiteful coworker. True False

True

Your boss listens to your complaint regarding unethical behavior, but tells you that you are being paid to follow his instructions and not be an ethics watchdog. What is this an example of? whistleblowing employee empowerment authoritarian leadership employee silence

authoritarian leadership

It is unknown how much of federal spending is lost due to fraud each year. True False

False

Since smaller companies often cannot afford to hire multiple ethical professionals, a chaplain often serves as the sole HR ethical representative. True False

False

In order to be eligible for a reward, the Dodd-Frank Act requires that whistleblowers publicly testify. True False

False

The company that your friend works for has treated them poorly. Because of this, they would like to see the company suffer losses. During the course of their work, they discover that their company is defrauding investors which they report through the proper channel. No action is taken. They then decide to blow the whistle on their company to bring the fraud to light and hopefully put the company out of business. Were these actions justified? No, personal animosity towards the company means that

Yes, though the motives were not good, since the fraud was reported internally and no action was taken, the next option was whistleblowing.

As an informed employee, you know that whistleblowing carries potentially serious consequences, both for you and your company. Under which of the following circumstances would you be most justified in whistleblowing? You have a strong suspicion that your company's products cause harm to consumers. You work for a government contractor and you have good reason to believe that labor laws have been violated in the past. You can prove that investors are being defrauded by your company. Your coworkers refuse to listen to your concerns about health code violations and your boss is too intimidating to speak to.

You can prove that investors are being defrauded by your company.

In which situation should you consider whistleblowing? You can prove your company has been releasing harmful chemicals into the community's groundwater. You reported this to all of your superiors, but no action has been taken. Your assistant has repeatedly come to work late and does not complete work as assigned. Your boss refuses to reprimand the assistant. You can prove your company has violated industry regulations in the past. You reported it to your superiors and they have created an action plan to resolve these violations. You suspect that the same co-worker has repeatedly stolen your lunch. Your boss refuses to take action against the employee.

You can prove your company has been releasing harmful chemicals into the community's groundwater. You reported this to all of your superiors, but no action has been taken.

Failure of internal reporting services to address unethical behavior ______. saves companies money over the long term generally creates an unpleasant work experience but poses little overall risk can lead to massive losses for both companies and consumers are to be expected as companies are often corrupt

can lead to massive losses for both companies and consumers

Why will an active employee often be more willing to report unethical behavior than a passive employee? Active employees take on responsibilities that are not their concern, whereas passive employees do the duties assigned to them. Active employees have an interest in undermining their bosses authority, whereas passive employees know it is best to stay within the hierarchy. Active employees are ambitious and will do anything to get ahead whereas passive employees are content to stay at their cur

Active employees know that they can shape their work environment whereas passive employees accept the status quo.

An ethics and compliance officer (ECO) and an ombudsman share similar roles. Which of the following best differentiates between the two? An ECO works with lower level employees, while an ombudsman works with upper level management and the board of directors. An ECO exists within the company hierarchy, but an ombudsman investigates outside of the normal corporate chain of command. An ECO cannot guarantee employee anonymity, but an ombudsman can. An ECO is a less common position at a company than an ombudsman.

An ECO exists within the company hierarchy, but an ombudsman investigates outside of the normal corporate chain of command.

As a manager, you overhear a conversation between two employees where they refer to an employee who reported unethical behavior as a "snitch." What action should you take to remain ethically approachable? Proudly post pictures of employees who have reported misconduct, as well as who the offense they reported. Communicate that those who report unethical behavior are positively shaping the work environment. Emphasize that employees who gossip about coworkers will be punished. Note that employees who report unethical behavior are just ambitiously trying to get ahead, which is good.

Communicate that those who report unethical behavior are positively shaping the work environment.

What is the relationship between employee empowerment and employee silence? Empowered employees will avoid employee silence because they know that they can shape their work environment. Empowered employees will participate in employee silence because they trust that management will handle difficult situations. Empowered employees will cause employee silence by making sure that all employees are loyal first to the company. Empowered employees will cultivate employee silence to ensure that workplace gossip does not hamper office morale.

Empowered employees will avoid employee silence because they know that they can shape their work environment.

A company has developed a reputation for unethical behavior but wishes to change its reputation. Which of the following would encourage open and honest communication from employees regarding unethical behavior? A no-tolerance policy where unethical behavior is met with termination. Distributing memos that stress the importance of reading the corporate ethics policies. Ensure that changes are made when unethical conduct is revealed. Conducting frequent audits of each employee's conduct.

Ensure that changes are made when unethical conduct is revealed.

Which of the following represents what is most likely to be a significant source of stress for an ethics and compliance officer? Working with people is difficult. Even one ethical lapse can severely damage a company's reputation. Whistleblowers must be suppressed in order to maintain the company's reputation. There is an expectation to meet with employees at any time, even outside normal business hours.

Even one ethical lapse can severely damage a company's reputation.

You are a manager of a small team. You overhear two employees discussing the morality of a certain decision. What action should you take to encourage ethical behavior? Avoid being present among employees because this increases employee stress and lowers morale. Let the discussion continue, because regular discussion about ethics is a positive thing. Listen in longer to gain information regarding possible unethical behavior. Stop the conversation because discussion of unethical behavior leads to

Let the discussion continue, because regular discussion about ethics is a positive thing.

If a company wishes to promote the use of an ethics assist line among employees, which of the following would likely be the most effective strategy? Closely monitor the ethics assist line so that you know the identity of those who use it. Publicize past unethical company decisions to make employees comfortable sharing their own. Strictly police who has access to the ethics assist line so that only credible sources will report there. Make sure to communicate that employees who use it are loyal an

Make sure to communicate that employees who use it are loyal and respected.

As a manager, you have implemented an open door policy to foster open communication with your employees. After instituting this policy, an employee comes to you looking nervous and asks to talk with you privately. Which of the following would be your best response? Reassure them that there's no need to be nervous. Anything they want to say they can say publicly. Talk with them in your office with the door closed. Confidential discussion is a part of healthy communication in an office. Bring them directly to your immediate superior. They clearly have important information to divulge. Keep your door open. You committed yourself to an open door policy and going back on that would cause employees to mistrust you.

Talk with them in your office with the door closed. Confidential discussion is a part of healthy communication in an office.

As a manager of a small company, you are facing a budget shortage and are trying to trim expenses. You currently contract a third party to run an ethics assist line for your company. However, you know your employees are comfortable speaking with them, so you decide to cancel your subscription to the third party ethics assist line and instead route calls through your personal cell phone. What is true about this change? This will likely lead to a higher number of fraudulent reports to the ethics a

This may cause employees to feel uncomfortable using the ethics assist line.

Confidentiality ensures that employees will not face retribution for reporting unethical behavior. True False

True

A promising employee of yours often asks you and others on the team about ethical matters rather than dealing with said matters independently. As a manager focused on fostering an environment that promotes ethical behavior, you should ______. encourage the employee to make ethical decisions independently be concerned, because consistent discussion of ethical matters indicates the employee does not act ethically be concerned, because this behavior may encourage other employees to act unethically encourage the employee to continue open discussion of ethical concerns

encourage the employee to continue open discussion of ethical concerns

An ombudsman is an ethical professional and therefore is ______. legally obligated to adhere to a set of professional ethics encouraged to adhere to a set of professional ethics, often through financial incentives ultimately an employee of the U.S. government rather than an individual institution required to hold a graduate degree in ethics or some equivalent

legally obligated to adhere to a set of professional ethics

You are assigned to monitor an ethics assist line and report back to management the information you gain through it. What information would you expect to see most often? fraudulent reports of abuses of power concerns regarding legal infractions questions regarding a human resources issue violations of government regulations

questions regarding a human resources issue