Business Ethics Final Exam - Padgett

Ethical Awareness

The ability to perceive whether a situation or decision has an ethical dimension

decentralized organization

decision-making authority is delegated as far down the chain of command as possible

values orientation

strives to develop shared values

ethical awareness

-ability to perceive whether a situation or decision has an ethical dimension

culture audit

-assessment of an organization's values -usually conducted by outside consultants

locus of control

-relates to individual differences in relation to a generalized belief about how you are affected by internal versus external events or reinforcements -the concept relates to how people view themselves in relation to power

Virtue ethics

Argues ethical behavior involves not only adhering to conventional moral standards but also considering what a mature person w a "good" moral character would deem appropriate in a given situation.

FSGO

Federal Sentencineg Guidelines for Organizations - approved by congress in 1991, set the tone for organizational ethical compliance programs ( 7 steps for effective ethical compliance)

Relativist

From this perspective definitions of ethical behavior are derived subjectively from the experiences of individuals and groups. Descriptive relativism relates to observations of cultures. Meta-ethical relativism proposes that people naturally see situations from their own perspectives, and there is no objective way of resolving ethical disputes b/w different value systems and individuals. Normative relativism assumes one person's opinion is good as another's

differential association

How an organization is different from how they made it appear

gender

In many aspects there are no differences between men and women when it comes to this and ethical decision making; women tend to rely on relationships, men tend to rely on justice and equity.

Sarbanes-Oxley 404

Requires firms to adopt a set of values that forms a portion of the company's culture. This section includes a requirement that management assess the effectiveness of the organization's internal controls and commision an audit of these controls by an external auditor in conjunction with the audit of its financial statements.

compliance culture

Tha accounting professional model of rules created a ____________________ organized around risk. These use a legalistic approach to ethics. They use laws and regulatory rules to create codes and requirements.

value-based ethics culture

This approach to ethical corporate cultures relies upon an explicit mission statement that defines the core values of the firm and how customers and employees might be treated

transactional/tranformational

Transactional leaders attempt to create employee satisfaction through negotiating or "bartering," for desired behaviors or levels of performance. Transformational leaders strive to raise employees' level of commitment and foster trust and motivation.

cultural audit

an assessment of an organization's values

obedience to authority

another aspect of the influence significant others can exercise; helps explain why many employees resolve business ethics issues by simply following the directives of a superior

formal group

committees - formal group of individuals assigned to a specific task. work groups - used to subdivide duties within specific functional areas of a company. teams - bring together the expertise of employees from several different areas of and organization on a single project.

age

complex relationship with ethics and age

informal group

composed of individuals, often from the same department, who have similar interests and band together for companionship or for purposes that may or may not be relevant to the goals of the organization.

definition of business ethics

comprises organizational principles, values, and norms that may originate from individuals, organizational statements, or from the legal system that primarily guide individual and group behavior in business.

Utilitarianism

concerned with consequences and seeks greatest good for the greatest number of people. Rule - determine behavior on the basis of principles or rules designed to promote the greatest utility rather than on individual examinations of each situation they encounter. Act - examine specific actions, rather than general rules governing them, to assess whether they will result in the greatest utility.

compliance orientation

creates order by requiring employees to identify with and commit to specific required conduct. Uses legal terms, statuses, and contracts that teach employees the rules and penalties for noncompliance.

stakeholders

customers, shareholders, employees, suppliers, govt agencies, communities, and many others who have a "stake" or claim in some aspect of a company's products, operations, markets, industry, and outcomes.

Egoism

defines right or acceptable behavior in terms of its consequences for the individual. Egoists believe they should make decisions that maximize their own self-interest, which is defined differently by each individual.

expert power

derived from a person's knowledge (or perception that a person possesses knowledge)

opportunity

describes the conditions in an organization that limit or permit ethical or unethical behavior; results from conditions that either provide rewards, whether internal or external, or fail to erect barriers against unethical behaviors

education

does not reflect experience but generally, the more of this and work experience that a person has, the better they are at making ethical decisions

coercive power

essentially the opposite of reward power. Instead of rewarding a person for doing something, coercive power penalizes actions or behaviors.

ethical issue vs ethical dilemma

ethical issue is a problem, situation, or opportunity that requires an individual, group, or organization to choose among several actions that must be evaluated as right or wrong, ethical or unethical. Ethical dilemma is problem, situation or opportunity that requires an individual, group, or organization to choose among several actions that have negative outcomes.

whistle-blowing

exposing an employer's wrong-doing to outsiders such as the media or govt regulatory agencies

codes of conduct

formal statements that describe what an organization expects of its employees (code of ethics, code of conduct, and statement of values)

integrative culture

high concern for people high concern for performance

caring culture

high concern for people low concern for performance

ethics officers

high-ranking persons known to respect legal and ethical standards responsible for 1) assessing the needs/risks an organization-wide ethics program must address 2) developing and distributing a code of conduct or ethics 3) conducting training programs for employees 4) establishing and maintaining a confidential service to answer employees' questions about ethical issues 5) making sure the company is in compliance w govt regulations 6) monitoring and auditing ethical conduct 7) taking action on possible violations of the company's code 8) reviewing and updating the code

normative approach

how organizational decision makers should approach an issue; the ideal standard

centralized organization

in this, decision-making authority is concentrated in the hands of top=level managers, and little authority is delegated to lower levels.

immediate job context

individuals' opportunity relates to this- where they work, whom they work with, and the nature of the work

motivation

is a force within the individual that focuses his or her behavior toward achieving a goal

job performance

is considered to be a function of ability and motivation and can be represented by the equation job performance = ability X motivation

exacting culture

low concern for people high concern for performance

apathetic culture

low concern for people low concern for performance

referent power

may exist when one person perceives that his or her goals or objectives are similar to another's. The second person may attempt to influence the first to take actions that allow both to achieve their objectives. Because they share the same goals, the first person perceives the other's use of referent power as beneficial. To be effective, some sort of empathy must exist between the individuals.

Code of ethics

most comprehensive and consists of general statements, sometimes altruistic or inspirational, that serve as principles and as the basis for rules of conduct. generally specifies methods for reporting violations, disciplinary action for violations, and structure of due process.

Sarbanes-Oxley Act

most far-reaching change in organizational control and accounting regulations since the Securities and Exchange Act of 1934. Made securities fraud a criminal offenses and stiffened penalties for corporate fraud. created new oversight board that requires corporations to establish codes of ethics for financial reporting and to develop greater transparency in financial reports to investors and other interested parties.

Integrity

one of the most important and oft-cited elements of virtue, and refers to being whole, sound, and in an unimpaired condition. Relates to product quality, open communication, transparency, and relationships.

habits of strong ethical leaders

one who does well for the stakeholders of the corporation, consistency is important

Fairness

quality of being just, equitable, and impartial. 3 main motivations to be fair - equality, reciprocity, and optimization.

reward power

refers to a person's ability to influence the behavior of others by offering them something desirable (ie money, status, promotion)

moral philosophy

refers to the specific principles or values people use to decide what is right and wrong. These are person-specific where business ethics is decided by groups

Honesty

refers to truthfullness or trustworthiness. to be honest is to

ethical culture

reflects the integrity of decisions made and is a function if many factors, including corporate policies, top management's leadership on ethical issues, the influence of co-workers, and the opportunity for unethical behavior

moral intensity

relates to individuals' perceptions of social pressure and the harm they believe their decisions will have on others

ethical issue intensity

relevance or importance to the decision or decision in the eyes of the individual, work group, and/or organization

different types of power

reward, coercive, legitimate, expert, referent

growth needs

satisfied by creative or productive activities

related needs

satisfied by social and interpersonal relationships

relatedness needs

satisfied by social and interpersonal relationships

Statement of values

serves the general public and also addresses distinct groups such as stakeholders.

corporate culture

set of values, norms, and artifacts including ways of solving problems that members of an organization share

group norm

standards of behavior groups expect of their members. Just as corporate culture establishes behavior for an organization's members, this defines acceptable and unacceptable behavior within a group.

legitimate power

stems from the belief that a certain person has the right to exert influence and certain others have an obligation to accept it.

nationality

the legal relationship between a person and the country in which he or she is born; because of cultural differences cannot state that ethical decison making will differ significatly among indivisuals of different nationalities

internal control

those who believe in this believe that they control the events in their lives by their own effort and skills; masters of their destinies; trust their capacity to influence their environment

external control

those who believe in this see themselves as going with the flow because that is all they can do; uncontrollable forces in life

significant others

those who have an influence in a work group, including peers, managers, coworkers, and subordinates

statement of values

type of ethical statement thats serves the general public and also addresses distinct groups such as stakeholders