Exam 2 Ethics

Departmental subcultures may be stronger than the larger organizational culture of which they are a part.

True

Your career can be irrevocably damaged if you mishandle an ethical issue, but ethical issues in business are predictable and potentially preventable.

True

Treating people differently simply because they are, or appear to be, different: is an acceptable expression of valuing diversity. is the basic definition of discrimination. is an inherent aspect of incorporating fairness into an otherwise unfair system. is the basic definition of valuing diversity.

Correct Response is the basic definition of discrimination.

Set of learned beliefs, traditions, and guides for shared behavior among group members. 1. Culture 2. Organizational Culture 3. Ethical Culture 4. Socialization 5. Formal System 6. Informal System 7. Internalization

Culture

Is based on expectations of confidentiality, product safety/effectiveness, truth in advertising, and fiduciary responsibility. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Customer Confidence

Severe penalties and loss of customer base and loyalty. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Customer Confidence

Lawsuits brought against the organization under laws and regulations such as the Americans With Disabilities Act and the Rehabilitation Act, or under tort or contract law, with accompanying legal fees, damages, negative media coverage, and lowered employee morale. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Discrimination

Occurs when something other than qualifications affects how an employee is treated. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Discrimination

Executive communications, hiring and promotional systems, orientation and training programs, rules, policies, codes, performance management systems, and official decision-making processes that contribute to (or inhibit) the existence of ethical culture within an organization. 1. Culture 2. Organizational Culture 3. Ethical Culture 4. Socialization 5. Formal System 6. Informal System 7. Internalization

Formal System

The formal and/or informal process of enculturization and commuication of cultural or subcultural expectations through which employees are conditioned to embrace an organization's culture. 1. Culture 2. Organizational Culture 3. Ethical Culture 4. Socialization 5. Formal System 6. Informal System 7. Internalization

Socialization

The basis of every personal and corporate relationship is __________, and it exists only when individuals and corporate leaders and employees feel that __________________________________________________________.

The basis of every personal and corporate relationship is trust, and it exists only when individuals and corporate leaders and employees feel that they're being treated fairly, openly, and on the same terms as everyone else.

Why is the founder of a new organization thought to play a particularly important culture-creating role?

The founder has a vision for what the new organization should be. He or she often personifies the culture's values, providing a role model for others to observe and follow, and guides decision making at all organizational levels.

Many large organizations have a headquarters ethics office that functions as the central point of communications for ethics and compliance sustainability.

True

One of the challenges employers face is that employees are quick to identify the real reason for a system and to figure out how to satisfy minimum requirements.

True

Personal use of corporate or employer resources, including time (regardless of value), is considered stealing.

True

Regardless of their personal beliefs, people tend to behave in ways that are consistent with a culture because they feel they are expected to do so and because they crave approval by peers and superiors.

True

The U.S. Sentencing Guidelines aim to encourage organizations to create ethics programs that drive integrity and ethical behavior in their business operations.

True

The U.S. Sentencing Guidelines include a provision for a "corporate death penalty."

True

The assumption that human beings are primarily driven by self-interest and opportunism tends to translate into a managerial philosophy based on behavioral control, whereas the assumption that human beings prefer to be associated with a fair organization that supports ethical behavior tends to translate into a managerial philosophy based on establishing and communicating organizational values.

True

The importance of mission and values statements lies in telling employees and internal audiences what the organization exists to accomplish and how to go about it.

True

The only way to determine whether organizational culture is aligned to support ethical behavior is to conduct regular, comprehensive audits of all relevant cultural systems.

True

Your obligation to ethically and responsibly use employer resources is part of your employer-employee contract.

True

tends to create the assumption in employees' minds that anything goes as long as there is no law or rule against it and that the company is more interested in protecting itself than in protecting its employees 1. values approach 2. compliance approach

compliance approach

Ethical culture is created and maintained through a complex interplay of __________ and ___________ organizational systems that must be aligned if they are to create a consistent ethical culture message.

formal, informal

Decision-making processes can contribute to the problem of unethical behavior by relying exclusively on ___________________ analysis and focusing only on __________________ outcomes.

quantitative, financial

For many companies, ethics and legal compliance are closely tied to maintenance of the firm's ____________ and ______________. In such an environment, ____________ becomes a key driver of corporate action.

reputation brand value integrity

It is important for values and mission statements to be closely aligned with other formal and informal dimensions of organizational culture.

True

A strong organizational culture is more likely to be ethical than a weak organizational culture.

False

An ethically neutral leader will generally be perceived as ethical by default.

False

Employees perceive an organization to have a "benevolence climate" when the organization treats its employees well, regardless of how it treats other stakeholders.

False

Ethical leaders have a stronger influence on organizational culture than unethical leaders.

False

It is easier for managers to change informal systems in organizational culture than it is for them to change formal systems.

False

It is generally bad practice for an ethics officer to have a direct reporting relationship to the CEO.

False

Investigation, loss of effective and valued employees, and loss of professional reputation among trust-based professions that have professional codes of ethics and fiduciary responsibilities. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Conflict of Interest

Occurs as a result of circumstances that cause judgment or objectivity to be compromised. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Conflict of Interest

What is the main problem or challenge that the concepts of loyalty and unquestioning obedience to authority present for ethical culture?

An unethical manager/authority could mislead an ethical/well intentioned employee. They are not expected to think for themselves, to question bad orders, or to take responsibility for problems they observe.

The question of discrimination is best analyzed from a virtue ethics perspective at the expense of other types of analysis.

False

Carrying on an office romance with anyone you supervise or who supervises you can create the potential for which of the following ethical problems? Conflict of Interest Harassment Both of the above None of the above

Both of the above

Identify the five (5) ways that executive leaders can help change organizational culture.

By articulating a new vision and values By paying attention to, measuring, and controlling certain things By making critical policy decisions By recruiting and hiring personnel who fit the organization's vision By holding people accountable for their actions

The portion of organizational culture that significantly influences ethical awareness, judgment, and action of individuals within the organization. 1. Culture 2. Organizational Culture 3. Ethical Culture 4. Socialization 5. Formal System 6. Informal System 7. Internalization

Ethical Culture

Role models, heroes, daily social norms, rituals, myths, stories, and language that contribute to (or inhibit) the existence of ethical culture within an organization and that either support or undermine other aspects of organizational culture. 1. Culture 2. Organizational Culture 3. Ethical Culture 4. Socialization 5. Formal System 6. Informal System 7. Internalization

Informal System

Adoption of external cultural standards as one's own, either over time or quickly because they are already in accord with one's existing beliefs. 1. Culture 2. Organizational Culture 3. Ethical Culture 4. Socialization 5. Formal System 6. Informal System 7. Internalization

Internalization

How does cognitive moral development theory pertain to business policy making?

It reveals that people are looking outside themselves for guidance. Organizational policy can be an important source of that guidance.

A strong organizational culture is one in which standards and guidelines are widely shared within the organization, providing common day-to-day direction, and where all cultural systems, formal and informal, are consistently aligned to point behavior in the same direction.

True

Researchers discovered that many people who risked their own well-being to help others threatened by the Nazis did so because...

They had "practiced" making ethical decisions earlier in their lives by imagining themselves in hypothetical situations that challenged their values. They also discussed their potential actions with others. Researchers called this "prescripting" that laid the groundwork for later heroic actions, as if thinking about ethical issues long before they were actually confronted by the issues gave people a sort of head start in the moral courage department.

Perhaps nothing has influenced corporate ethics programs in the United States more than the ____________________, which took effect in the early 1990s.

US Sentencing Guidelines

Within the ethics infrastructure, good communication—____________, _____________ and _____________—is essential if an organization is to have a strong, aligned ethical culture.... These communication efforts should be ____________, __________, _____________, and _____________.

Within the ethics infrastructure, good communication—downward, upward, and two-way—is essential if an organization is to have a strong, aligned ethical culture.... These communication efforts should be synergistic, clear, consistent, and credible.

disciplinary procedures are an essential aspect and motivating factor 1. values approach 2. compliance approach

compliance approach

employees are informed that obedience is essential and disobedience will result in punishment 1. values approach 2. compliance approach

compliance approach

The concept of "voice" in the Giving Voice to Values program: is primarily about learning to vocalize or communicate your own ethical values to others. engenders the process of analyzing a situation, audience, and your own motivations before figuring out the best way to get your point across to others. focuses on the importance of being a lone voice when you're bucking an unethical system. none of the above

engenders the process of analyzing a situation, audience, and your own motivations before figuring out the best way to get your point across to others.

While an ethics or compliance officer may be either an insider or an outsider, the best choice is usually a(n) __________________________who knows the company's ____________________.

insider who knows the company's culture and people.

What two basic communication principles are essential to effectively communicating ethics?

1. Align formal and informal communication systems., 2. Analyze the audience.

The two dimensions of being an ethical leader are being a moral _____________ and being a moral _________________.

person, manager

What, in addition to values, does everyone have that impacts how each person faces tough ethical issues?

personal narrative

When it comes to work-related actions, organizational culture generally influences the actions of individuals less than national or regional culture.

False

Pertain to fulfilling one's duties and responsibilities under an employer-employee contract. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Corporate Resources

Policy manuals are excellent vehicles for communicating important rules to general employees.

False

List the seven (7) requirements that an organization must adhere to in order to demonstrate due diligence and the existence of an effective compliance program:

1. Establishing compliance standards reasonably capable of preventing criminal conduct. 2. Assigning specific high-level individuals with responsibility to oversee those compliance standards. 3. Exercising due care to ensure that discretionary authority is not delegated to individuals with a propensity to engage in illegality. 4. Taking necessary steps to communicate compliance standards and procedures to all employees, with a special emphasis on training and the dissemination of manuals. 5. Taking reasonable steps to achieve compliance with written standards through monitoring, auditing, and other systems designed to detect criminal conduct, including a reporting system free of retribution to employees who report criminal conduct. 6. Consistently enforcing the organization's written standards through appropriate disciplinary mechanisms, including, as appropriate, discipline of individuals responsible for failure to detect an offense. 7. After an offense is detected, taking all reasonable steps to respond and to prevent future similar conduct.

The 2004 revisions to the U.S. Sentencing Guidelines added additional, rather costly requirements. List five (5) that are given in the textbook: (KNOW 4 of the 5)

1. Expectation that the board of directors will oversee the compliance and ethics program. 2. Senior management will ensure its effectiveness. 3. Compliance officers will have adequate authority and access to senior management. 4. Organizations must train employees and conduct risk assessments to identify potential areas of concern. 5. The compliance program must be seen as an integral part of the organization's culture.

Increased costs due to losses and theft, as well as the need for employee monitoring. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Corporate Resources

A contractual relationship that has essential contract elements, as well as accompanying rights and responsibilities, exists between employer and employee only if there is a signed, written contract between the parties.

False

A good substitute for an ethics program is a company code of conduct.

False

A moral person will automatically be an effective moral manager when placed in a leadership role.

False

An effective ethics program should have only values (proactive and aspirational) components and no compliance (behavioral focus) components.

False

An ethical organizational culture generally changes to an unethical one by intention rather than neglect.

False

Discrimination is an ethical issue but not a legal issue.

False

Employees are more likely to believe and follow messages carried by formal systems than they are messages carried by informal systems.

False

Employees prefer to work for an organization that has a weakly aligned ethical culture because it makes it easier for them to meet minimum standards and to get away with things.

False

For an organization to be convicted of a federal crime, more than one of the organization's employees must be caught breaking the law.

False

Given the choice, and absent any external influences, most people prefer to act unethically.

False

What website do the authors recommend visiting to investigate what employees are saying about a company you might be interested in working for?

Glassdoor.com

Liability for actions of offending employees, substantial victim awards, and the inability to attract qualified candidates, as well as the need to discipline and reassign employees to different posts within the organization, regardless of their qualifications. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Harassment

Occurs when an employee is subjected to unwelcome behavior that makes them feel uncomfortable at work. 1. Discrimination 2. Harassment 3. Conflict of Interest 4. Customer Confidence 5. Corporate Resources

Harassment

Define hypocritical leadership:

Hypothetical leadership refers to a leader who is strong on the communication aspect of moral management but is not an ethical person.

Consider your own personal narrative. In light of the Giving Voice to Values self-assessment questions (only those that apply to you), how does your personal narrative potentially impact how you face hard ethical questions (for good or bad)?

I grew up in a home where honesty was emphasized. Thus, when I face difficult situations where honesty might get me into trouble, I must think about the values that I have been raised on. These experiences help guide me in the right direction. For example, in one of the projects that manage this year, damage was incurred to property that was not mine. We knew that telling the truth would likely cost us money. I had to make the decision to report the damage or to hide it.

An effective leader must be the master of two ends of the spectrum. What are those two ends?

Ideas at the highest level of abstraction Actions at the most mundane level of detail

Why is being a moral person not in itself enough to be perceived as an ethical leader?

It tells employees how the leader is likely to behave, but it doesn't tell them how the leader expects them to behave.

Shared assumptions, beliefs, traditions, and guides for behavior unique to a particular organization and that are manifested in formal and informal rules/systems/policies, rituals, heroes, stories, history, and values. 1. Culture 2. Organizational Culture 3. Ethical Culture 4. Socialization 5. Formal System 6. Informal System 7. Internalization

Organizational Culture

List at least five (5) general "triggers" to help you determine whether an issue is serious enough to be raised with someone beyond your immediate manager. (Read this question—and the textbook—carefully!)

The issue involves values such as: 1. truth 2. employer/customer/stakeholder rights 3. trust 4. fairness 5. harm 6. personal or organizational reputation 7. whether the law is being broken or compromised

"Prescripting," or thinking about potential ethical issues and planning potential actions ahead of time, tends to increase a person's moral courage when that person actually faces ethical issues and challenges.

True

Between 70 and 90 percent of information passed via organizational grapevines (continual streams of information among employees about "what's really going on") has been demonstrated by research to be accurate.

True

Discrimination is an ethical issue—apart from any legal protections—because it is at the core of fairness and trust in the workplace.

True

The U.S. Sentencing Guidelines use a "carrot and stick" approach to managing corporate crime, providing incentives to organizations to develop a ________________________________.

a strong internal control system to detect and manage illegal behavior.

The purpose of identifying a self-narrative is to: make it easier to voice your values and beliefs later. identify individuals and experiences that might serve as sources of strength or passion when faced with ethical dilemmas. identify characteristics and behaviors that align with your image of yourself for purposes of reinforcement and/or adjustment. all of the above

all of the above

focus is on required behavior and obeying the letter of the law rather than aspiring to ethical principles and values 1. values approach 2. compliance approach

compliance approach

largely motivated by legislative measures like the U.S. Sentencing Guidelines and Sarbanes-Oxley 1. values approach 2. compliance approach

compliance approach

They understand and follow the rules and policies of the organization and have good personal ethical compasses. Their judgment and experience help them discern the difference between right and wrong, and they generally have the moral grounding to do the right thing. They do not blindly follow orders but are willing to question an order they believe may be illegal or morally wrong. 1. good soldiers 2. loose cannons 3. grenades

good soldiers

They're neither ignorant nor benign. They may or may not know the rules and don't care either way. They have their own agenda and lack company and professional loyalty. Their activities can severely damage the organization. 1. good soldiers 2. loose cannons 3. grenades

grenades

They have good ethical compasses but may not know their organization's ethics policies and may not be familiar with general business ethics standards. They tend to be inexperienced or come from an industry with different norms. They may be well-meaning but naive or easily influenced. 1. good soldiers 2. loose cannons 3. grenades

loose cannons

"People issues" refer to problems and ethical issues: that arise only when people with low cognitive moral development work together. such as privacy, discrimination, sexual and other types of harassment, as well as merely failing to get along. that arise when people perceive an outcome as being unfair, despite their perceptions of procedural fairness. that inevitably arise as a result of unreasonable notions of fairness and reciprocity inherent in human nature.

such as privacy, discrimination, sexual and other types of harassment, as well as merely failing to get along.

connects expected behavior and high standards to the spirit of the law and organizational values 1. values approach 2. compliance approach

values approach

employees reasonably expect that some sanctions may occur if there are ethical violations 1. values approach 2. compliance approach

values approach

ethics is a point of pride in the organization 1. values approach 2. compliance approach

values approach

incorporates ethical goals and values that are not empty words, but are words that organizational leaders believe and live by 1. values approach 2. compliance approach

values approach

proactive and aspirational 1. values approach 2. compliance approach

values approach

relies on techniques like leader communication and role modeling to affirm the organization's committed to ethical values and goals 1. values approach 2. compliance approach

values approach