Chapter 2: Connect Master Intro to Buisness

Managers do not set an ethical example.

Because executives looked the other way when suppliers used banned substances in their products, employees feel justified in dumping pollutants down the drain.

What is the earliest point at which workers should be screened for strong personal values and a commitment to ethical behavior?

Before they are hired

A company that contributes to charities, sponsors local sports teams, or donates to museums is engaging in which type of corporate social responsibility program?

Community activities

From the list below, select all of the key areas of focus of a social audit.

Corporate policy Community activities Sustainability

From the list below, select all of the advantages associated with corporate social responsibility.

Improved public image Enhanced ability to solve important problems

Social entrepreneurship

Leveraging business for social change

Shaking hands when meeting someone in the United States is an example of a(n) ______.

cultural norms

An organization has the responsibility to obey the laws of the host country in which it operates. According to Carroll's Corporate Social Responsibility Pyramid, this is the firm's _______ responsibility.

legal

Today, most business leaders agree that profits and corporate social responsibility ______.

should be pursued concurrently

A work facility characterized by long work hours, low (or no) wages, and abusive conditions is called a ______.

sweatshop

Sustainability

"Green is good"

Create ethical codes and training.

"We need to share our expectations."

Reward ethical behavior

"We should discipline appropriately."

Create an ethical hiring culture.

"We want honest employees."

Set an ethical example.

"We're not just giving lip service."

From the list below, select all of the consequences associated with unethical business behavior.

Diminished reputation Reduced profitability

Corporate policy

Positions on political and social issues

What do we call the combined ethics, values, attitudes, and behaviors that are typical among a society or group?

Cultural norms

What do we call the formal rules of conduct that are enforced by controlling authorities such as police officers and the court system?

Laws

What is philanthropy?

Making charitable donations to benefit humankind

Philanthropy

Not dying rich

According to Carroll's Global Corporate Responsibility Pyramid, which corporate responsibility has to do with contributing resources to the community and seeking to improve the quality of life for individuals?

Philanthropic

Which type of socially responsible program involves making charitable donations to benefit humankind?

Philanthropy

What are ethics?

Principles of right and wrong that influence behavior

Cause-related marketing

Supporting worthy causes

Which of the following governmental bodies was formed by the passage of the Sarbanes-Oxley Act of 2002?

The Public Company Accounting Oversight Board

From the list below, select all of the reasons Milton Friedman cited in arguing that corporate social responsibility is contradictory to the pursuit of profit.

It provides no benefit to stockholders. It distracts from producing goods and services. It does not help the company create jobs.

An electronics manufacturer prides itself on its ethical standards. Job candidates are screened based on their past behaviors, top managers work hard to set a good example for employees, and the company has rewards in place for employees who live up to the company's ethical codes. However, after an exceptionally busy year, customers begin to complain that customer service representatives no longer respond to product failures. Based on this scenario, how did the organization fail to foster high ethical standards?

The company did not provide regular ethics training.

Who in an organization is most responsible for setting an ethical example?

Top management and executives

Why do opponents of corporate social responsibility (CSR) believe that profit and CSR are contradictory goals?

Firms that spend money on CSR will be distracted from producing goods and services, leading to lower profits.

What is cause-related marketing?

Forming a partnership with a charity or nonprofit to support a worthy cause, service, or product

A systematic assessment of a company's performance in implementing socially responsible programs is called a(n) ______.

social audit

Companies conduct a systematic assessment of their performance in implementing socially responsible programs as part of a(n) _____ audit.

social

What is one of the six key areas a social audit focuses on?

Social entrepreneurship

What is corporate social responsibility?

Taking actions that benefit society as well as the organization

Which federal law provides protection from retaliation in the United States?

The Sarbanes-Oxley Act

What is corporate policy as it relates to social audits?

A company's stated positions on political and social issues

Which of these behaviors is considered illegal?

A manufacturer uses a harmful chemical that has been banned in the United States.

What is a code of ethics?

A set of ethical standards to help guide an organization's actions

The company does not set a code of ethics and provide ethical training.

Employees are confused about which behaviors are acceptable in the office, leading to complaints about harassment and offensive jokes.

From the list below, select all of the labels that describe diversity policies, such as affirmative action.

Ethical Legal

From the list below, select all of the ways that company owners benefit from ethical business practices.

Improved mental and physical health Financial rewards Increased ability to attract valuable employees

Which of the following statements about investments in unethical firms is true?

They earn abnormally negative returns.

What is the primary objective of a social audit?

To evaluate a company's performance in implementing socially responsible programs

From the list below, select all of the factors that make a given behavior an issue of ethics.

Whether the behavior conforms to cultural beliefs regarding right and wrong Whether the behavior reflects how most people would like to be treated

Community activities

Sponsorship, fundraising, donations, and other support

What is the primary motivation for ethical behavior under a compliance-based ethical code?

The threat of punishment

Arrange the responsibilities described in Carroll's Global Corporate Social Responsibility Pyramid in order, with the responsibility that appears at the base of the pyramid on the bottom.

1. Philanthropic responsibility 2. Ethical responsibility 3. Legal responsibility 4. Economic responsibility

From the list below, select all of the ways that illegal behavior can affect the profitability of a business.

Consumers become less likely to purchase the company's products. The company is forced into costly lawsuits that may result in fines or jail time. Employees are more likely to steal from the company.

From the list below, select all of the actions that are part of an organization's philanthropic responsibility.

Contributing resources to the local community Acting as a good global corporate citizen Improving the quality of life of individuals in the host country

Which term describes a concern for taking actions that benefit society as well as the organization?

Corporate social responsibility

The company does not create an ethical hiring culture.

Recruiters look for "ruthless moneymakers" in their sales personnel, and soon customers begin complaining about dishonest sales pitches.

From the list below, select all of the steps managers should take to establish an ethical climate.

Set an ethical example. Reward ethical behavior. Create an ethical hiring culture.

Which of these actions would make it more difficult for a manger to establish an ethical climate?

Waiting until a job candidate is hired to emphasize the company's ethical culture

What is a law?

A formal and binding rule of conduct that is enforced by a controlling authority

In the context of ethics and social responsibility, what is a value?

A relatively permanent and deeply held belief or attitude

The company does not reward ethical behavior.

An employee reports being overpaid in her quarterly sales bonus but is not acknowledged for her honesty. The next time, she decides not to report the mistake.

What is a whistleblower?

An employee who reports organizational misconduct to the government or the public

What is a common method organizations use to ensure job candidates are honest and ethical before they are hired?

Ask candidates about past experiences that reflect a commitment to ethical behavior.

Which type of ethical code attempts to prevent criminal misconduct by increasing control and by punishing violators?

Compliance-based

From the list below, select all of the negative effects of illegal behavior.

Diminished reputation and profit Fines and jail time Costly lawsuits

From the list below, select all of the examples of community activities that a company might engage in as part of its corporate social responsibility programs.

Donating to museums Encouraging employees to volunteer at charities Sponsoring sports teams

Which role is tasked with integrating the organization's ethics and values initiatives, compliance activities, and business practices into the company's decision-making processes?

Ethics officer

Which of the following positions is advocated by proponents of simultaneously pursuing both social and financial value?

Firms should seek to both maximize profits and engage in corporate social responsibility.

From the list below, select all of the steps that large organizations take to implement ethics programs.

Hire an ethics officer to integrate ethics programs into the company's decision-making Require human resources personnel to prioritize ethical behavior when hiring Provide regular ethics training programs

Which term best characterizes social entrepreneurship?

Innovation

Which type of ethical code stresses a culture of fair play, honesty, and diversity as a way of promoting ethical behavior?

Integrity-based

According to opponents of corporate social responsibility (CSR), what is the primary reason to avoid engaging in CSR programs?

It detracts from the firm's only real responsibility: maximizing profits.

From the list below, select all of the provisions that are part of the Sarbanes-Oxley Act of 2002.

It prohibits top management from taking personal loans from the company. It requires speedy disclosure of major changes in the company's financial or operating conditions. It provides job reinstatement and back pay to whistleblowers who are punished by their employers.

An organization that adheres to both local and international laws is meeting which responsibility?

Legal

Which of these labels applies to a company's decision to avoid paying taxes in the United States by storing revenues in offshore banks?

Legal but unethical

From the list below, select all of the features commonly found in a code of ethics.

List of prohibited behaviors Guidance on how to treat customers, suppliers, and competitors

From the list below, select all of the features used to promote ethical behavior under an integrity-based code of ethics.

Shared accountability Honesty Diversity

Which type of socially conscious program involves an innovative, social value-creating activity that can occur within or across the for-profit and nonprofit sectors?

Social entrepreneurship

What is the name of the voluntary agreement established by the United Nations that promotes human rights, good labor practices, environmental protection, and anticorruption standards for businesses?

The Global Compact

How do individuals in organizations often view compliance-based codes in comparison to integrity-based codes?

They are seen as laws that should not be violated.

Which characteristic is shared by both compliance-based and integrity-based ethical codes?

They help employees understand which behaviors are encouraged and which are discouraged.

What is an organization's legal responsibility?

To obey local, national, and international laws

Why should systems for reporting ethical violations be anonymous?

To protect whistleblowers from retaliation

What is an organization's ethical responsibility?

To take into account host country and global values, norms, and standards when making business decisions

According to Carroll's Global Corporate Social Responsibility Pyramid, the base of the pyramid is ______ responsibility, while the top of the pyramid is ______ responsibility.

economic; philanthropic

Many large organizations hire a(n) ________ _________ to integrate the organization's code of ethics into the company's decision-making process.

ethics officer

An organization has the responsibility to obey the laws of the host country in which it operates. According to Carroll's Corporate Social Responsibility Pyramid, this is the firm's _________ responsibility.

legal

The ethics, values, attitude, and behaviors that are typical in a given culture are known as cultural

norms

In a social audit, the assessment of a company's performance in implementing socially responsible programs is typically based on ______.

predefined goals