Gateway 2 Business Knowledge Check (Ch. 2)

How do multinational corporations demonstrate social responsibility in a foreign country?

As a citizen of several countries, a multinational corporation has several responsibilities. These include respecting local practices and customs, ensuring that there is harmony between the organization's staff and the host population, providing management leadership, and developing a solid group of local managers who will be a credit to their community.

What is corporate philanthropy?

Corporate philanthropy includes cash contributions, donations of equipment and products, and support for the volunteer efforts of company employees.

What is the role of top management in organizational ethics?

Employees often follow the examples set by their managers. That is, leaders and managers establish patterns of behavior that determine what's acceptable and what's not within the organization.

What is a code of ethics?

In general, a code of ethics provides employees with the knowledge of what their firm expects in terms of their responsibilities and behavior toward fellow employees, customers, and suppliers.

How are individual business ethics formed?

Managers and business owners make business decisions based on what they believe to be right and wrong. Through their actions, they demonstrate to their employees what is and is not acceptable behavior and shape the moral standard of the organization.

Is a company's only responsibility to its investors to make a profit? Why or why not?

No, company's also have to put an emphasis on social responsibility in order to please investors.

What is utilitarianism?

One of the philosophies that may influence choices between right and wrong is utilitarianism, which focuses on the consequences of an action taken by a person or organization. The notion that people should act so as to generate the greatest good for the greatest number is derived from utilitarianism. When an action affects the majority adversely, it is morally wrong.

Describe strategic giving

Strategic giving ties philanthropy and corporate social responsibility efforts closely to a company's mission or goals and targets donations to the communities where a company does business.

What role do employees have in improving their job security?

Thanks to today's tight labor market, some employees feel empowered to demand more from their employer and its overall culture via strategies such as increased flexibility, transparency, and fairness. This increased importance of the employee's role in the company's culture helps workers stay engaged in the mission of the organization and perhaps makes them less likely to look elsewhere for employment.

Give an example of legal but irresponsible behavior

The Minnesota-based company that makes MyPillow was recently fined $1 million by the state of California for making unsubstantiated claims that the "most comfortable pillow you'll ever own" could help alleviate medical conditions such as snoring, fibromyalgia, migraines, and other disorders. The company's CEO countered that the claims were actually made by customers.

What are the four components of social responsibility?

The four components are Legal Responsibility, Economic Responsibility, Philanthropic Responsibility, and Ethical Responsibility.

How do businesses carry out their social responsibilities to consumers?

To be successful in today's business environment, a company must satisfy its customers. A firm must deliver what it promises, as well as be honest and forthright in everyday interactions with customers, suppliers, and others.

How can you recognize unethical activities?

You can recognize unethical activities generally if they go against the rule and guidelines set by your business. This can also be seen through questionable personal behavior such as habitual lying, stealing, and intimidation.