Chapter 10 - Business Ethics, Social Responsibility, and Environmental Sustainability

The percentage of persons age 65 or older exceeds 20 percent in Japan, Italy, and

Germany.

According to a recent Wall Street Journal article, ________ percent of all firms sampled had no restrictions on boss-subordinate love affairs at work.

5

Which of the following companies ranks among those against whom some of the largest payouts for class-action legal fraud suits ever were judged?

AOL Time Warner

What challenge facing all organizations requires managers to formulate strategies that preserve and conserve natural resources and control pollution?

Ecological

The ________ is a network of the national standards institutes of 147 countries, one member per country.

ISO

Many people consider it unethical for a firm to be socially irresponsible.

True

________ was socially responsible in the wake of the earthquake and tsunami that devastated Japan in 2011; it also was able to get supplies to people who needed them following Hurricane Katrina.

Walmart

Environmental advocacy groups now have ________ Americans as members.

over 20 million

The U.S. Foreign Corrupt Practices Act and a new provision in the Dodd-Frank financial regulation-law allows company employees who bring cases of financial fraud, such as bribery, to the government's attention to receive ________ percent of any sum recovered.

up to 30

Which of the following is NOT a way that companies can help create an ethical culture in their organization?

Discouraging whistle-blowing

Which of the following business actions is considered to be unethical?

Misleading labeling

More and more firms believe that ethics training and an ethics culture

create strategic advantage.

Bad ethics can ________ strategic plans.

derail even the best

According to a study by the Institute of Business Ethics, companies that do not display ethical conduct consistently outperform companies that show a clear commitment to ethical conduct.

false

After decades of debate and struggle, firms have finally definitively determined the appropriate social policies.

false

Corporate social policy should be reaffirmed or changed during strategy implementation.

false

ISO 14001 is a technical standard and as such replaces technical requirements embodied in statutes or regulations.

false

It has gotten easier for firms to get away with placing "green" terminology on their products and labels because there are still no legal or generally accepted definitions of terms like "organic," "green," "safe," or "earth-friendly."

false

Moving jobs overseas is not considered to be an unethical business practice.

false

The percentage of persons age 65 or older will reach 20 percent in the United States in 2018.

false

There is no country that favors or engages in commercial whaling today.

false

A rising tide of consciousness about the importance of business ethics is sweeping the United States and the rest of the world.

true

Business ethics can be defined as principles of conduct within organizations that guide decision making and behavior.

true

Japan is providing incentives for its elderly to work until ages 65-75.

true

Periodic ethics workshops can help sensitize people to workplace circumstances in which ethics issues may arise.

true

Ralph Nader believes that big firms like ExxonMobil, which has more assets than most countries, have an obligation to help society cure its many ills.

true

Sustainability refers to the extent that an organization's operations and actions protect, mend, and preserve rather than harm or destroy the natural environment.

true

The first social responsibility of any business must be to make enough profit to cover the costs of the future because if this is not achieved, no other social responsibility can be met.

true

Bribery involves

bestowing a gift to influence the recipient's conduct.

A proactive environmental policy is likely to lead to

conservation of energy.

Firms should strive to engage in social activities that

have economic benefits.

Unethical activities that plague online commerce include all of the following EXCEPT

inappropriate gifts.

All of the following business actions are considered to be unethical EXCEPT

preventing environmental harm.

Workplace romance

simply happens so organizations should determine how to best manage the phenomena.

Social policy can best be defined as

the responsibilities a firm has to employees, consumers, environmentalists, minorities, communities, shareholders, and other groups.

A bribe is a gift bestowed to influence a recipient's conduct.

true

A new wave of ethics issues has accentuated the need for strategists to develop a clear code of business ethics.

true

Corporate social policy should be designed and articulated during strategy formulation.

true

More and more firms believe that ethics training and an ethics culture create strategic advantage.

true

New Jersey's goal is to obtain 3 percent of its electricity from the sun and 12 percent from offshore wind by 2020.

true

Some ways in which firm's are working to be more environmentally responsible include using solar power and selling organic and environmentally friendly products.

true

The ISO 14000 family of standards concerns the extent to which a firm minimizes harmful effects on the environment caused by its activities and continually monitors and improves its own environmental performance.

true

Which is a rule from the Wall Street Journal article "The New Rules of Flirting"?

Do not make physical contact with the person you are flirting with, unless it is within a desired relationship.

Employee wellness cannot be a part of sustainability.

False

Firms should strive to engage in social activities that have no economic benefits, to avoid their being viewed as public relations ploys.

False

Which of the following was among the most admired companies for social responsibility in 2012 according to Fortune magazine?

GDF Suez

________ is a set of standards in fields such as environmental auditing, performance evaluation, and labeling, that is adopted by thousands of firms worldwide to certify to their constituencies that they are conducting business in an environmentally friendly manner.

ISO 14001

All of the following statements are true EXCEPT

ISO has legal authority to enforce its regulations' implementation.

Preserving the environment should be a permanent part of doing business for which of the following reasons?

More lenders are examining the environmental liabilities of businesses seeking loans.

________ are the individuals primarily responsible for ensuring that high ethical principles are espoused and practiced in an organization.

Strategists such as CEOs and business owners

Which state generates the greatest number of megawatts of wind power?

Texas

________ refers to policies that require employees to report any unethical violations they discover or see in the firm.

Whistle-blowing

A document that discloses to shareholders information about a firm's labor practices, product sourcing, energy efficiency, environmental impact, and business ethics practices is known as

a sustainability report.

Alaska and oil companies contend that protections for polar bears ________.

are diminishing opportunities for Alaska energy development

Responsibility for encouraging ethical decision making and ensuring ethical behavior in a firm lies with

both a firm's strategists and its managers.

If a firm has a bad sustainability record this will

cause investors to closely scrutinize the firm.

Walmart encourages its employees to adopt "Personal Sustainability Projects" like weight-loss or smoking-cessation support groups, illustrating that

employee wellness can be a part of sustainability.

The European Parliament in late 2012 voted with an overwhelming 566-47 margin t

eradicate the practice of shark finning.

A recent Wall Street Journal article reported that 80 percent of all firms sampled had no restrictions on relationships between a supervisor and a subordinate.

false

Bad ethics can derail all but the best strategic plans.

false

CEOs and business owners should delegate the responsibility for ensuring that high ethical principles are espoused and practiced in an organization.

false

California is the nation's second-largest producer of solar energy.

false

Good ethics is not a prerequisite for good strategic management.

false

Having a code of ethics ensures ethical business behavior.

false

History has proven that the lower the trust and confidence of people in the ethics of an institution or society, the greater its economic strength.

false

ISO, the world's largest developer of sustainability standards, is legally authorized to enforce their standards.

false

In Europe, romantic relationships at work are frowned upon, and most firms have policies prohibiting the practice.

false

In order to be considered bribery, the gift offered must be either money or a physical item.

false

Like the United States, Japan is eager to rely on large-scale immigration to bolster its workforce.

false

Monitoring departmental and corporate performance regarding ethical issues can cause firms to misalign ethical and strategic decision making.

false

Most firms warn managers and employees that reporting an ethical violation by others, also known as whistle-blowing, could cause them to be discharged.

false

Primary responsibility for ensuring ethical behavior rests with middle- and low-level managers, since they are in a position to influence many employees.

false

Social responsibility refers to actions an organization takes that are legally required to protect or enhance the well-being of living things.

false

Some strategists agree with Ralph Nader, who asserts that organizations have no obligation to do any more for society than is legally required.

false

While it is socially responsible to be a good steward of the natural environment, doing so will not enable a firm to gain competitive advantage.

false

Workplace romance and sexual harassment are synonymous.

false

It is ________ for a business to provide a sustainability report annually to the public.

good business

All of the following are reasons that workplace romance can be detrimental to workplace morale and productivity EXCEPT

increased quality and quantity of work can occur.

Simply having a code of ethics

is insufficient to guarantee that employees behave in an ethical manner.

According to the text, the first social responsibility of any business is to

make enough profit to cover the costs of the future, because if this is not achieved then no other social responsibility can be met.

Firms can align ethical and strategic decision making by

monitoring departmental and corporate performance regarding ethical issues.

It has become ________, since uniform standards defining environmentally responsible company actions are rapidly being incorporated into our legal landscape.

more and more difficult for firms to make "green" claims when their actions are not substantive or even true

In an effort to manage ecological challenges, many companies are

moving environmental affairs from the staff side of the organization to the line side.

Japan's prescription for dealing with problems associated with an aging society includes

reversing the old-fashioned trend of keeping women at home.

Japan is suffering from a decline in overall economic production

since worker productivity increases are not able to offset declines in number of workers.

Business ethics, ________, and sustainability issues are interrelated and impact all areas of the comprehensive strategic-management model.

social responsibility

A code of business ethics is

sorely needed in light of a new wave of ethical issues including product safety, employee health, and sexual harassment.

Special natural environment issues include all of the following EXCEPT

spreading computer viruses.

The United Kingdom's new Bribery Law

stipulates that failure to prevent bribery is an offense.

According to the Convention on the International Trade in Endangered Species (CITES), more than 25,000 elephants are killed each year for their ivory—even though international trade in ivory has been outlawed since 1989.

true

Avon Products is being investigated for bribery charges related to their winning the first direct-sales license awarded by China to a foreign company.

true

Companies such as Walmart are now monitoring not only the prices its vendors offer for products, but also how those products are made in terms of environmental practices, as well as safety and infrastructure soundness.

true

Dumping banned or flawed products in foreign markets is considered to be an unethical business practice.

true

European firms are increasingly adopting explicit, American-style sexual harassment laws.

true

In 2012, Chinese firms dominated Fortune magazine's list of the least admired companies from a social responsibility perspective.

true

In 2012, GDF Suez, Marquard & Bahls, and RWE were the three most admired socially responsible companies according to Fortune magazine.

true

In some foreign countries, paying bribes and kickbacks is acceptable.

true

Integrating ethical decision making into the performance appraisal process is one way that firms can align ethical and strategic decision making.

true

Orphan drugs offer pharmaceutical companies no economic incentive for profitable development and distribution.

true

Social policy concerns what responsibilities the firm has to employees, consumers, environmentalists, minorities, communities, shareholders, and other groups.

true

Some of the largest payouts for class-action legal fraud suits ever were against Enron ($7.16 billion) and WorldCom ($6.16 billion).

true

Sustainability reports reveal how a firm's operations impact the natural environment.

true

The EEOC recovers about $500 million on behalf of office romance victims.

true

The percentage of persons age 65 or older exceeds 20 percent in Japan, Italy, and Germany.

true

Unlike the USA, Japan has no law against discrimination based on age.

true

Whistle-blowing refers to policies that require employees to report any unethical violations they discover or see in the firm.

true