MGT 121 ch 2 concepts

Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010

promoted the financial stability of the united states by improving accountability and responsibility in the financial system; established a new Consumer Financial Protection Agency to regulate home mortgages, car loans, and credit cards

American Recovery and Reinvestment Act 2009

provided $7.22 billion to the EPA to protect and promote "green" jobs and a healthier environment

10. Equal Credit Opportunity Act 1974

provided equal credit opportunities for males and females and for married and single individuals. Provided for minimum disclosure standards for written consumer-product warranties for products that cost more than $15

18. Credit Card Accountability, Responsibility, and Disclosure Act 2009

provided the most sweeping changes in credit card protections since the truth in lending act of 1968

How can businesses reduce sexual harassment and abusive behavior at the workplace?

providing programs like codes of ethics to create formal policies that define and prohibit unacceptable abusive conduct

Why did Congress create (and later strengthen) the Equal Employment Opportunity Commission?

to investigate complaints of employment discrimination and the power to sue firms that practice it

16. Children's Online Privacy Protection Act 2000

Placed parents in control over what information is collected online from their children younger than 13 years; required commercial website operators to maintain the confidentiality, security, and integrity of personal information collected from children

11. Amendments to the Equal Credit Opportunity Act 1976, 1984

Prevented discrimination based on race, creed, color, religion, age, and income when granting credit

14. Telephone Consumer Protection Act 1991

Prohibited the use of automated dialing and prerecorded voice calling equipment to make calls or deliver messages

Clean Air Amendment 1970

Provided stringent automotive, aircraft, and factory emission standards

6. Truth in Lending Act 1968

Required lenders and credit merchants to disclose the full cost of finance charges in both dollars and annual percentage rates

1. Federal Hazardous Substances Labeling Act 1960

Required warning labels on household chemicals if they were highly toxic

What is meant by business ethics?

applying moral standards to business situations

What is the social audit? Who should prepare a social audit for the firm?

a comprehensive report of what an organization has done and is doing with regard to social issues that affect it the program director prepares it

What is an affirmative action program? What is its purpose?

a plan designed to increase the number of minority employees at all levels within an organization. employers with federal contracts of more than 50k per year must have written affirmative action plans

Explain and give an example of how advertising can present ethical questions.

false/misleading advertising is unethical and illegal ex: using words such as "healthy, low fat, or light" in a health related ad when the product is not healthy at all

What is trade association's role in encouraging ethics?

having a code of ethics or ethical guidelines that ensures any member in that group is behaving ethically

How does opportunity influence the level of ethical behavior in the workplace?

opportunity is the amount of freedom an organization allows an employee to behave unethically if they make that choice degree of enforcement of company policies, procedures, and ethical codes can reduce opportunity

Outline the historical evolution of business social responsibility.

---During the first quarter of the 20th century, government protection of workers and consumers was minimal. ---During this period, consumers generally were subject to the doctrine of caveat emptor - a Latin phrase meaning "let the buyer beware". ---Before the 1930s, most people believed that competition and the action of the marketplace would, in time, correct abuses. ---The collapse of the stock market triggered the great depression, and public pressure soon mounted for the government to "do something" about the economy and the worsening social conditions. ---As government involvement has increased, so has everyone's awareness of the social responsibility of business.

What are the six important business related federal laws passed between 1887 and 1914?

1. Interstate Commerce Act 1887 - first federal act to regulate business practices; provided regulation of railroads and shipping rates 2. Sherman Antitrust Act 1890 - Prevented monopolies or mergers where competition was endangered 3. Pure Food and Drug Act 1906 - Established limited supervision of interstate sales of food and drugs 4. Meat Inspection Act 1906 - Provided for limited supervision of interstate sales of food and drugs 5. Federal Trade Commission Act 1914 - Created the Federal Trade Commission to investigate illegal trade practices 6. Clayton Antitrust Act 1914 - Eliminated many forms of price discrimination that gave large businesses a competitive advantage over smaller firms

What are the arguments for increased social responsibility?

1. because business is part of society, it cannot ignore social issues 2. business has the technical, financial, and managerial resources needed to tackle today's complex social issues 3. by helping resolve social issues, business can create a more stable environment for long-term profitability 4. socially responsible decision making by firms can prevent increased government intervention, which would force businesses to do what they fail to do voluntarily

What are the arguments against increased social responsibility?

1. business managers are responsible primarily to stockholders, so management must be concerned with providing a return on owner's investments 2. corporate time, money, and talent should be used to maximize profits, not to solve society's problems 3. social problems affect society in general, so individual businesses should not be expected to solve these problems 4. social issues are the responsibility of government officials who are elected for that purpose and who are accountable to the voters for their decisions

Describe several individual factors that influence the level of ethical behavior in an organization.

1. how much an individual knows (personal knowledge) 2. moral values and central, value related attitudes 3. personal goals and the manner in which these goals are pursued

What steps must a business take to implement a program of social responsibility?

1. securing the commitment of top executives 2. planning 3. appointing a director 4. preparing a social audit

Describe the six basic rights of consumers.

1. the right to safety: products must be safe for their intended use, have explicit directions, and must be tested to ensure quality and reliability 2. the right to be informed: consumers must have access to complete information about a product before they buy it 3. the right to choose: consumers must have a choice of products, offered by different manufacturers and sellers, to satisfy a particular need 4. the right to be heard: someone will listen to customer complaints and take appropriate action 5. the right to consumer education: people should know their rights as consumers 6. the right to service: convenience, courtesy, and responsiveness from manufacturers and sellers

Food Quality Protection Act 1996

Amended the Federal Insecticide, Fungicide, Rodenticide Act and the Federal Food Drug and Cosmetic Act; the requirements included a new safety standard - reasonable certainty of no harm - that must be applied to all pesticides used on foods

9. Fair Credit Billing Act 1974

Amended the Truth in Lending Act to enable consumers to challenge billing errors

Resource Conservation and Recovery Act 1984

Amended the original 1976 act and required federal regulation of potentially dangerous solid waste disposal

4. Fair Packaging and Labeling Act 1966

Called for all products sold across state lines to be labeled with net weight, ingredients, and manufacturer's name and address

17. Do-Not-Call Implementation Act 2003

Directed the FCC and the FTC to coordinate so that their rules are consistent regarding telemarketing call practices including the Do Not Call Registry and other lists, as well as call abandonment

Explain the two views on the social responsibility of business.

Economic Model of SR - the view that society will benefit most when business is left alone to produce and market profitable products that society needs Socioeconomic Model of SR - the concept that business should emphasize not only profits but also the impacts of its decisions on society

Resource Recovery Act 1970

Enlarged the solid waste disposal program and provided for enforcement by the EPA

Noise Control Act 1972

Established standards for major sources of noise and required the EPA to advise the Federal Aviation Administration on standards for airplanes

National Environmental Policy Act 1970

Established the Environmental Protection Agency to enforce federal laws that involve the environment

7. Credit Card Liability Act 1970

Limited credit card holder's liability to $50 per card and stopped credit card companies from issuing unsolicited cards. Required credit bureaus to provide credit reports to consumers regarding their own credit files; also provided for correction of incorrect information

12. Fair Debt Collection Practices Act 1977

Outlawed abusive collection practices by third parties

15. Consumer Credit Reporting Reform Act 1997

Placed more responsibility for accurate credit data on credit issuers; required creditors to verify that disputed data are accurate and to notify a consumer before reinstating the data

What are the different types of ethical concerns that may arise in the business world?

bullying/harassment bribing favoritism misusing company time stealing lying to employees violating internet policies hurting the environment

What are the major forces in consumerism today?

consumer advocates and organizations, consumer education programs, and consumer laws

Explain several social factors that affect ethics in an organization.

cultural norms actions and decisions of coworkers values and attitudes of people in their personal life the use of the internet

How can the government encourage the ethical behavior of organizations?

enacting stricter regulations ex: Sarbanes-Oxley Act of 2002 (protects whistle-blowers) laws can be ethical or unethical, which can even encourage businesses to act unethically such as produce pollution as long as it is under the legal limit. While they are following the environmental laws, they are still hurting the environment, which is unethical regardless of the laws.

Clean Air Act Amendment 1987

established a national air quality standard for ozone

8. Consumer Product Safety Commission Act 1972

established an abbreviated procedure for registering certain generic drugs

Clean Air Act Amendment 1977

established new deadlines for cleaning up polluted areas; also required review of existing air quality standards

Water Pollution Control Act Amendment 1972

established standards for cleaning navigable streams and lakes and eliminating all harmful waste disposal by 1985

5. Motor Vehicle Safety Act 1966

established standards for safer cars

2. Kefauver-Harris Drug Amendments 1962

established testing practices for drugs and required manufacturers to label drugs with generic names in addition to trade names

Oil Pollution Act 1990

expanded the nation's oil spill prevention and response activities; also established the oil spill liability trust fund

What are business's responses to environmental concerns?

identifying and eliminating inefficiencies in production and operations finding alternative uses for waste recycling using renewable power green marketing: creating, making, delivering, and promoting products that are environmentally safe

What is whistle-blowing? Who protects the whistle-blowers?

informing the government or press about unethical things happening in an organization that you work for protected by the Sarbanes-Oxley Act of 2002

What are some of the issues businesses must consider with regard to public health?

obesity, smoking, heart disease, alcohol use, smartphone use while driving

3. Cigarette Labeling Act 1965

required manufacturers to place standard warning labels on all cigarette packages and advertising

Clean Air Act Amendments 1990

required that motor vehicles be equipped with onboard systems to control about 90% of refueling vapors

13. Nutrition Labeling and Education Act 1990

required the FDA to review current food labeling and packaging focusing on nutrition label content, label format, ingredient labeling, food descriptors and standards, and health messages

Water Quality Improvement Act 1970

strengthened existing water pollution regulations and provided for large monetary fines against violators

What is social responsibility? How can business be socially responsible?

the recognition that business activities have an impact on society and the consideration of that impact in business decision making businesses can be socially responsible by helping less fortunate people, the environment, etc.

What are the major environmental issues facing society today?

waste and pollution