Exam 1: CH 5
(T/F) Unrealistic goals provide stress which may pressure ethical employees to do whatever is necessary to meet those goals.
TRUE
(T/F) When employees are evaluated only on outcomes, they may be pressured to do whatever is necessary to look good on the outcomes, and not be concerned with how they got those results.
TRUE
social obligation
The obligation of a business to meet its economic and legal responsibilities and nothing more; reflects the classical view
To be named on the Global 100 list, which is announced each year at the ________, a company has to display a superior ability to effectively manage environmental and social factors.
World Economic Forum
social responsibility
a business's intention, beyond its legal and economic obligations, to do the right things and act in ways that are good for society; reflects the socioeconomic view
The Global Compact
a document created by the United Nations outlining principles for doing business globally in the areas of human rights, labor, the environment, and anticorruption
locus of control
a personality attribute that measures the degree to which people believe they control their own fate
ego strength
a personality measure of the strength of a person's convictions
protective mechanisms
allow employees who face ethical dilemmas to do what's right without fear of reprimand
employee selection
an opportunity to learn about an individual's level of moral development, personal values, ego strength, and locus of control
Foreign Corrupt Practices Act
makes it illegal to knowingly corrupt a foreign official. However, even this law doesn't always reduce ethical dilemmas to black and white
socioeconomic view
management's social responsibility goes beyond making profits to include protecting and improving society's welfare
green management
managers consider the impact of their organization on the natural environment low to high environmental sensitivity: •legal (light green) approach •market approach •stakeholder approach •activist (dark green) approach
are ethical standards universal?
no; social and cultural differences determine acceptable behaviors
values based management
organization's values guide employees in the way they do their jobs
At the ________ level of moral development, a person's choice between right or wrong is based on personal consequences from outside sources, such as physical punishment, reward, or exchange of favors.
preconventional
At the ________ level of moral development, individuals define moral values apart from the authority of the groups to which they belong or society in general.
principled
ethics
principles, values, and beliefs that define right and wrong behavior many decisions managers make require them to consider both the process and who's affected by the result
ten principles of the united nations global compact
-Human Rights 1: Support and respect the protection of international human rights within their sphere of influence. 2: Make use business corporations are not complicit in human rights abuses. -Labor Standards 3: Freedom of association and the effective recognition of the right to collective bargaining. 4: The elimination of all forms of forced and compulsory labor. 5: The effective abolition of child labor. 6: The limitation of discrimination in respect to employment and occupation. -Environment 7: Support a precautionary approach to environmental challenges. 8: Undertake initiatives to promote greater environmental responsibility. 9: Encourage the development and diffusion of environmentally friendly technologies. -Anti-Corruption 10: Businesses should work against corruption in all its forms, including extortion and bribery.
arguments for social responsibility
-public expectations -long-run profits -ethical obligation -public image -better environment -discouragement of further governmental regulation
arguments against social responsibility
-violation of profit maximization -dilution of purpose -costs -too much power -lack of skills -lack of accountability
stages of moral development
3 levels, each having two stages
Which of the following organizations is best suited to promote ethical behavior in its employees? A) An organization that has a reward and punishment system that depends on specific goal outcomes. B) An organization that has formal rules and regulations in place. C) An organization that wants its employees to achieve their goals at any cost. D) An organization that has a performance appraisal system that focuses exclusively on outcomes.
B) An organization that has formal rules and regulations in place.
Which of the following is true concerning the impact of organizational culture on ethical behavior? A) An organization with low conflict tolerance encourages ethical behavior. B) An organization with strong culture encourages high ethical standards. C) An organizational culture that is high in conflict tolerance encourages unethical behavior. D) An organizational culture that is high in control encourages unethical behavior.
B) An organization with strong culture encourages high ethical standards.
Which of the following examples reflects a socially responsible action by an organization? A) Ford Motor Company became the first automaker to endorse a federal ban on sending text messages while driving. B) Apple has eliminated lead-lined glass monitors from its product line and pioneered reduced-sized packaging that leverages recyclable materials. C) Fed Ex provided the Federal Emergency Management Agency (FEMA) with a radio antenna to set up communications in the immediate aftermath of Hurricane Katrina. D) UPS has a company-wide policy that urges employees to volunteer during natural disasters and other crises.
B) Apple has eliminated lead-lined glass monitors from its product line and pioneered reduced-sized packaging that leverages recyclable materials.
marketing approach
firms respond to the preferences of their customers for environmentally friendly products
John Doe is employed with the IT department in Abel and Associates, that provides financial consultancy services to several wealthy investors. He is approached by a shady investor who offers attractive incentives for stealing some sensitive information regarding the investment patterns of one of the clients of the company. Which of the following statements best reflects John's thoughts if he is at the principled level of moral development? A) My job is to protect the information that this company deals in and I should not be violating my duties. B) By stealing from another person, I will be in violation of the moral standards I've come to expect of myself. C) If my involvement is detected, my friends and family would be humiliated by my actions. D) If I am convicted for this crime, I will surely be imprisoned and will probably never be employed anywhere else.
B) By stealing from another person, I will be in violation of the moral standards I've come to expect of myself.
John Doe is employed with the IT department in Abel and Associates, that provides financial consultancy services to several wealthy investors. He is approached by a shady investor who offers attractive incentives for stealing some sensitive information regarding the investment patterns of one of the clients of the company. Which of the following statements best reflects John's thoughts if he is at the preconventional level of moral development? A) If I do go through with the act, I will be letting down my manager and coworkers badly. B) My job is to protect the information that this company deals in and I should not violate my duties. C) I am liable to be criminally prosecuted for my involvement in stealing the information. D) Going through with this act would be highly unfair not just to the client, but also to my employers.
C) I am liable to be criminally prosecuted for my involvement in stealing the information.
One way to evaluate a company's green actions is to use the ________ list of the most sustainable corporations in the world.
Global 100
Many companies around the globe voluntarily report their efforts in promoting environmental sustainability using the guidelines developed by the ________.
Global Reporting Initiative
(T/F) In the preconventional stage of moral development, individuals make a clear effort to define moral principles apart from the authority of the groups to which they belong or of society in general.
FALSE
(T/F) The Organization for Economic Co-Operation and Development developed a global code of ethics.
FALSE
What does ISO stand for?
International Organization for Standardization
classical view
Management's only social responsibility is to maximize profits
The most outspoken advocate of the classical view of organizational social responsibility is economist and Noble laureate _____________.
Milton Friedman
The centerpiece of the ________ efforts is the Anti-Bribery Convention that was the first global instrument to combat corruption in cross-border business deals.
Organization for Economic Co-operation and Development's
(T/F) An organization's structural design, its goals, performance appraisal systems, and reward allocation procedures influence the ethical choices of employees.
TRUE
(T/F) At the conventional level of moral development, ethical decisions rely on maintaining expected standards and living up to the expectations of others.
TRUE
(T/F) If performance appraisals focus only on economic goals, ends will begin to justify means.
TRUE
(T/F) One argument against businesses championing social responsibility issues is that businesses already have too much power.
TRUE
(T/F) Possession of resources is an argument for social responsibility.
TRUE
(T/F) Under the Sarbanes-Oxley Act, whistle-blowers in the United States who report suspected corporate violations of laws now have broad protection from reprisals and retaliation.
TRUE
legal (light green) approach
firms simply do what is legally required by obeying laws, rules, and regulations willingly and without legal challenge
values
basic convictions about what is right and wrong
A U.S. business that provides on-site childcare facilities for employees is ________.
being socially responsive
When a firm advertises that it only uses recycled paper products it is ________.
being socially responsive
internal locus
believe they control their own destinies
The belief that business involvement can help solve difficult social problems is the ________ argument on social responsibility.`
better environment
How can managers identify the ethically questionable applicants even before they became part of the workforce?
by asking the candidates to go through interviews, tests, and background checks
Which argument on social responsibility states that pursuing social goals hurts a business's economic productivity?
dilution of purpose
stakeholder approach
firms work to meet the environmental demands of multiple stakeholders—employees, suppliers, and the community
The board of directors of Acme Generating Corporation is meeting to consider the construction of a new electricity generation facility somewhere along the Muspetan River basin. The city of Muspetan has a high Air Pollution Index and the increasing amount of garbage is adding to the city's woes. Director Appleton would like the facility to be a coal-burning plant located in a remote area because the cost involved is moderate. Director Witworth wants a nuclear plant because this will not add to the city's already serious pollution problem, while taking care of its electricity requirements. Director Jossleman wants a plant that uses combustible fuels collected from the city's garbage. He wants the plant to be located near the downtown government area so that the steam could be used for heating the government buildings after it has passed through the generating turbines. Which social responsibility view is Director Appleton following?
classical view
organization's culture
consists of the shared organizational values
At the ________ level of moral development, ethical decisions rely on maintaining expected standards and living up to the expectations of others.
conventional
activist (dark green) approach
firms look for ways to respect and preserve the environment and be actively socially responsible
leadership
doing business ethically requires a commitment from top managers because: •they're the ones who uphold the shared values and set the cultural tone •they're role models in terms of both words and actions •what they do is far more important than what they say
What two personality variables have been found to influence an individual's actions according to his or her beliefs about what is right or wrong?
ego strength and locus of control
ISO 14000
environmental management
The aspect that differentiates social responsibility from other similar concepts is that it adds a(n) ________.
ethical imperative
According to the ________ argument on social responsibility, businesses should be socially responsible because responsible actions are the right thing to do.
ethical obligation
The primary debate about ethics training programs is whether ________.
ethics can be taught
independent social audits
evaluate decisions and management practices in terms of the organization's code of ethics
code of ethics
formal statement of an organization's values and the ethical rules it expects employees to follow; contents tend to fall into three categories: •Cluster 1: Be a Dependable Organizational Citizen •Cluster 2: Do Not Do Anything Unlawful or Improper That Will Harm the Organization •Cluster 3: Be Good to Customers
Max Proffit, director of research and development for National Products Company, that is into producing hiking gears has learned that a new material has been developed in his department that appears to make the ropes and slings more durable. He has discussed this development with his two assistants, Susie Merriweather and Moe Gaines, and Rush Onward, vice president of product development. Susie has stated her opposition to the use of the new material because its durability has not yet been tested and has not been certified by the company's third-party testing laboratory. Moe argues that the initial tests that their R&D department completed indicate minimal problems with durability. Rush states that in several meetings he has recently attended, the company president had repeatedly emphasized the need to increase earnings per share. Rush tells Max that a decision has to be made within the week about the new material's use by the Company. If Max resists his impulse to okay the use of the uncertified material because of the need for increased earnings per share he ________.
has a strong ego strength
Max Proffit, director of research and development for National Products Company, that is into producing hiking gears has learned that a new material has been developed in his department that appears to make the ropes and slings more durable. He has discussed this development with his two assistants, Susie Merriweather and Moe Gaines, and Rush Onward, vice president of product development. Susie has stated her opposition to the use of the new material because its durability has not yet been tested and has not been certified by the company's third-party testing laboratory. Moe argues that the initial tests that their R&D department completed indicate minimal problems with durability. Rush states that in several meetings he has recently attended, the company president had repeatedly emphasized the need to increase earnings per share. Rush tells Max that a decision has to be made within the week about the new material's use by the Company. Moe Gaines's support of using the new uncertified material is an indication that he ________.
has a weak ego strength
Max Proffit, director of research and development for National Products Company, that is into producing hiking gears has learned that a new material has been developed in his department that appears to make the ropes and slings more durable. He has discussed this development with his two assistants, Susie Merriweather and Moe Gaines, and Rush Onward, vice president of product development. Susie has stated her opposition to the use of the new material because its durability has not yet been tested and has not been certified by the company's third-party testing laboratory. Moe argues that the initial tests that their R&D department completed indicate minimal problems with durability. Rush states that in several meetings he has recently attended, the company president had repeatedly emphasized the need to increase earnings per share. Rush tells Max that a decision has to be made within the week about the new material's use by the Company. Susie's opposition to the use of the new uncertified material is an indication that she ________.
has an internal locus of control
issue intensity
how important an ethical issue is to an individual determined by: •Greatness of harm •Consensus of wrong •Probability of harm •Immediacy of consequences •Proximity to victim(s) •Concentration of effect
social entrepreneur
individual or organization who seeks out opportunities to improve society by using practical, innovative, and sustainable approaches
whistle-blower
individual who raises ethical concerns or issues to others inside or outside the organization
Which argument on social responsibility states that there is no direct line of responsibility for social actions?
lack of accountability
Under the concept of social obligation, the organization does what is required by the ________.
law
social screening
process of applying social and environmental criteria to an investment decision
ISO 900
quality management
ethics training
seminars, workshops, and similar ethics training programs to encourage ethical behavior
What can be said about a manager who believes that she worked hard and met the productivity goals of her organization despite unfavorable conditions?
she has an internal locus of control
If your university was paying minimum wage when necessary and applying the minimum legal standards to its employees' work environment, it would be said to have fulfilled its ________.
social obligation
In the United States a company that meets federal pollution control standards and does not discriminate in hiring, promotion, and pay is generally meeting its ________.
social obligation
If your university provides job-share programs, builds a day-care facility, and only uses recycled paper, it could be said to be ________.
socially responsible
The board of directors of Acme Generating Corporation is meeting to consider the construction of a new electricity generation facility somewhere along the Muspetan River basin. The city of Muspetan has a high Air Pollution Index and the increasing amount of garbage is adding to the city's woes. Director Appleton would like the facility to be a coal-burning plant located in a remote area because the cost involved is moderate. Director Witworth wants a nuclear plant because this will not add to the city's already serious pollution problem, while taking care of its electricity requirements. Director Jossleman wants a plant that uses combustible fuels collected from the city's garbage. He wants the plant to be located near the downtown government area so that the steam could be used for heating the government buildings after it has passed through the generating turbines. Director Jossleman is being mostly __________.
socially responsible
The board of directors of Acme Generating Corporation is meeting to consider the construction of a new electricity generation facility somewhere along the Muspetan River basin. The city of Muspetan has a high Air Pollution Index and the increasing amount of garbage is adding to the city's woes. Director Appleton would like the facility to be a coal-burning plant located in a remote area because the cost involved is moderate. Director Witworth wants a nuclear plant because this will not add to the city's already serious pollution problem, while taking care of its electricity requirements. Director Jossleman wants a plant that uses combustible fuels collected from the city's garbage. He wants the plant to be located near the downtown government area so that the steam could be used for heating the government buildings after it has passed through the generating turbines. Which social responsibility view is Director Witworth following?
socioeconomic view
Which argument on social responsibility states that businesses should address social problems before they become serious and costly to correct?
superiority of prevention over cures
A student who never considers breaking into an instructor's office to steal an accounting exam didn't think twice about asking a friend who took the same course from the same instructor last semester what questions were on the exam. What does this example illustrate?
the concept of issue intensity
Your university has tried to promote the establishment of shared values so that all members will understand its beliefs. The university has established ________ management.
value-based
What two individual characteristics play a role in determining whether a person behaves ethically?
values and personality
Which argument on social responsibility states that a business is socially responsible only when it pursues its economic interests?
violation of profit maximization
If Google asks twenty-five members of its executive team to spend a full day at their annual team-building retreat building a house in Las Vegas with Habitat for Humanity, the executives would be engaging in employee ________.
volunteering efforts
social responsiveness
when a firm engages in social actions in response to some popular social need; reflects the socioeconomic view
ways managers can encourage ethical behavior
•employee selection •leadership •job goals and performance appraisals •independent social audits protective mechanisms •code of ethics and decision rules
factors that determine ethical/unethical behavior
•individual characteristics •issue intensity •structural variables •organizational culture