Modules 1, 2 & 3

Which of these stakeholders is a secondary stakeholder? A. Regulators B. Employees C. Special-interest groups D. Suppliers E. Consumers

Special-interest groups

What likely contributed to the flawed corporate culture at Countrywide Financial? A. Unscrupulous clients B. A flawed incentive system C. Failure to take risks D. Overworked employees E. A decrease in profitability

A flawed incentive system

Based on observations of J. P. Morgan CEO James Dimon's reaction to a crisis, what is a good way to manage a crisis? A. Act quickly and take responsibility for the issues. B. Avoid talking to the media until the crisis is past. C. Try to downplay the issue and describe the company's strengths. D. Defend the company at all costs to avoid reputational damage. E. Allow other people in the company to address the issue.

Act quickly and take responsibility for the issues.

Which definition describes an ethical issue? A. When a company finds itself in a situation where all the alternatives are unsatisfactory B. Principles and other behavioral boundaries which are universal in nature C. A foundation for decision making where there is no room for compromise D. How important an ethical situation is perceived to be by a company or individual E. An identifiable problem, situation, or opportunity that requires a person or organization to choose among several actions that may be evaluated as ethical or unethical

An identifiable problem, situation, or opportunity that requires a person or organization to choose among several actions that may be evaluated as ethical or unethical

What is the definition of an ethics audit? A. A program to help employees know how to act in ethical dilemmas B. A way of analyzing a firm's financial situation C. A review of your board of directors and top executives D. Behavioral expectations that dictate appropriate behavior E. An investigation into the ethical climate of the firm

An investigation into the ethical climate of the firm

Why might a company not want to investigate reports of misconduct? A. An investigation is often time-consuming and expensive. B. Investigating would conflict with the firm's code of conduct. C. To maintain a positive reputation. D. Companies want to avoid hiring an ethics officer. E. Leaders would rather have the report analyzed by legal authorities.

An investigation is often time-consuming and expensive.

Why are hotlines useful in a firm? A. Because most managers are not willing to listen to employees. B. Because the firm doesn't have an open-door policy. C. Because they are useful for punishing reporters of misconduct. D. Because they allow the caller to remain anonymous. E. Because they are the most direct way to report misconduct.

Because they allow the caller to remain anonymous.

Which statement is true about a compliance orientation and a values-based orientation within a company? A. A compliance orientation is superior to a values-based orientation. B. Both orientations are unsatisfactory in detecting and resolving ethical issues. C. Both orientations can increase ethical awareness among employees. D. A compliance orientation often leads to misconduct, whereas a values-based orientation deters misconduct. E. A compliance orientation is more ethical than a values-based orientation.

Both orientations can increase ethical awareness among employees.

By being highly persuasive and skilled at getting employees to adhere to a common goal or mission, Zappos CEO Tony Hsieh displays what kind of leadership style? A. Charismatic leadership B. Transformational leadership C. Transactional leadership D. Authentic leadership

Charismatic leadership

An Enron, the lowest 20 percent of performers were systematically fired. This could be an example of __________. A. Expert power B. Reward power C. Coercive power D. Legitimate power E. Referent power

Coercive power

What is one of the biggest ethical risks that companies face? A. Complacency B. Underachievement C. Unfavorable media D. Government regulation E. Whistle-blowing

Complacency

Which statement is true regarding the aftermath of the financial crisis A. Consumer trust of business hit a low point. B. Consumers place more trust in fast growing and profitable companies. C. The stock of ethical firms decreased quicker than other companies' stock. D. Voluntary turnover at companies increased. E. Consumers place greater trust in legal and regulatory institutions.

Consumer trust of business hit a low point.

Which word best describes a compliance orientation? A. Values-based B. Contractual C. Participative D. Unethical E. Flexible

Contractual

What is one way that ethical leaders can empower employees? A. Hiring employees with strong personal values. B. Creating an open communication environment. C. Setting challenging goals that are measurable. D. Developing a strict and intolerant culture. E. Eliminating manager and supervisor roles.

Creating an open communication environment.

While principles are more _________ in nature, values are more __________ and tend to be enforced by society. A. subjective; universal B. universal; absolute C. flexible; unchanging D. universal; subjective E. subjective; objective

D. universal; subjective

What is true about the influence of ethical decision making factors in an organization? A. Individual values play only a minor role in organizational decision making. B. Employee decision making is often affected more by organizational relationships. C. Employees should always follow their intuition. D. Employees rarely make decisions that have ethical implications. E. Opportunity is the most significant factor in ethical decision making.

Employee decision making is often affected more by organizational relationships.

In this section, ___________ was identified as the best way to identify misconduct in an organization. A. Tapping employee phone lines B. Installing hidden video cameras C. Assigning employees to spy on each other D. Sifting through employee emails E. Employee reporting

Employee reporting

What are the benefits of ethical leadership? A. Ethical companies often attract the most aggressive and high performing employees. B. Consumers are less attracted to products from companies with ethical leadership. C. Companies with ethical leadership do not make ethics mistakes. D. Turnover is likely to be higher in ethical organizations as scrutiny and expectations are higher. E. Employees are more willing to work for ethical companies.

Employees are more willing to work for ethical companies.

Employees disagreeing about the most ethical decision, for resolving an ethical dilemma, is an example of: A. Lack of internal controls B. Bad attitudes C. Ethical diversity D. Groupthink E. Ethical issue intensity

Ethical diversity

Which statement is true about the ethical decision-making of leaders? A. Ethical leaders must often make trade-offs regarding stakeholder demands. B. Skilled, ethical leaders find it easy to make ethical decisions. C. Ethical leaders balance their personal and organizational ethics to not maximize profitability. D. Ethical decisions always result in favorable consequences for the firm. E. Ethical leaders do not obtain employee input for major decisions.

Ethical leaders must often make trade-offs regarding stakeholder demands.

What is true about ethical leaders? A. Ethical leaders are born, not made. B. Ethical leaders do not talk about misconduct in the workplace. C. Ethical leaders place company interests above their own. D. Ethical leaders often use autocratic management processes. E. Ethical leaders avoid getting too friendly with other employees.

Ethical leaders place company interests above their own.

What is true about how ethical leaders should perceive stakeholders? A. Ethical leaders treat all stakeholders equally regardless of importance. B. Ethical leaders view stakeholders as important co-contributors of firm value. C. Ethical leaders focus more in internal than external stakeholders. D. Ethical leaders meet every stakeholder's demand. E. Ethical leaders view stockholders as the most important stakeholder.

Ethical leaders view stakeholders as important co-contributors of firm value.

If Steve Jobs was admired for his knowledge of Apple products, he displayed _________. A. Legitimate power B. Referent power C. Expert power D. Reward power E. Coercive power

Expert power

Why is expert power one of the more effective forms of power a leader can demonstrate? A. Followers are able to trust the leader's expertise and credibility. B. It makes the leader appear more approachable. C. The leader is usually more intelligent than the average individual. D. This leader is usually the highest authority figure in the company. E. The leader can be trusted to know everything going on within the organization.

Followers are able to trust the leader's expertise and credibility.

Which statement best describes codes of ethics? A. Formal statements describing what an organization expects of its employees B. Ethical values that an employee must follow C. Certification that all company documentation is accurate D. Legal documents that specify a detailed list of regulations E. Behavioral expectations that dictate appropriate behavior

Formal statements describing what an organization expects of its employees

What is the first step organizations must take to meet the needs of their stakeholders? A. Eliminate stakeholders not essential for the firm's survival. B. Respond to stakeholder demands. C. Determine whether primary stakeholders are important. D. Gather data on the company's stakeholders. E. Develop a high-quality product.

Gather data on the company's stakeholders.

In this module, we described five examples of ethically-challenged CEOs. What is not one of the mistakes they made? A. Placing their own interests over those of the company B. Engaging in excessive risk-taking C. Giving employees more decision-making authority D. Focusing on short-terms profits rather than long-term sustainability E. Manipulating accounting statements to make the firm look more profitable

Giving employees more decision-making authority

What is the definition of ethical issue intensity? A. How important an ethical issue is perceived to be by a company or individual B. What occurs when an ethical decision goes wrong C. How intense the ethical misconduct is within a company D. A problem requiring an ethical decision E. The resulting evaluation after an ethical decision has been made

How important an ethical issue is perceived to be by a company or individual

Which of the following differentiates ethical leaders from less ethical leaders? A. How many employees report to them B. How many mistakes they have made C. How many degrees they have obtained D. How much power they have E. How they respond to mistakes

How they respond to mistakes

Why would an organization not want to rely solely on an individual's personal ethics? A. Individuals seek to take advantage of the company. B. Individual employees cannot handle complex ethical situations. C. Employees rarely use their personal values in making ethical decisions within the organization. D. Ethical diversity contributes to a more ethical organizational culture. E. Individual personal values differ significantly and can result in unethical conduct.

Individual personal values differ significantly and can result in unethical conduct.

Which definition best describes organizational ethical leadership A. Establishing an exhaustive system of checks and balances. B. Controlling decision making in the organization. C. Delegating ethical responsibilities to lower level managers. D. Forcing others to do what you want them to do. E. Influencing others to ethically achieve company goals.

Influencing others to ethically achieve company goals.

Describe the purpose of ethics training. A. It is a formal document that provides guidelines to help employees resolve ethical issues. B. It provides employees with the chance to become ethics officers. C. It allows employees to prepare themselves for issues they might encounter in the workplace. D. To provide a system of reporting for employees. E. To gain support from key stakeholders.

It allows employees to prepare themselves for issues they might encounter in the workplace.

Why is shared leadership important? A. It keeps leaders from corrupting employees. B. It establishes checks and balances on every member of the organization. C. It empowers leaders to make ethical decisions D. It removes some of the responsibility of board members. E. It prevents the firm from hiring employees with bad character.

It establishes checks and balances on every member of the organization.

According to Howard Schultz, which of the following is true about ethical leadership? A. It is more important for corporate office employees than store employees. B. It will make your business less profitable, which results in high employee turnover. C. It takes 10 years or more to build an ethical culture. D. It is impossible to achieve because technology and social media outlets expose every mistake. E. It is about finding a way to balance between profitability and social consciousness.

It is about finding a way to balance between profitability and social consciousness.

What is the purpose of a code of ethics? A. It provides guidelines to help employees recognize and resolve ethical issues. B. It provides a way for employees to defend themselves against misconduct accusations. C. It allows employees to discipline their co-workers for inappropriate conduct. D. It provides instructions on how to handle every ethical dilemma in the industry. E. It allows employees to integrate their values into the organizational culture.

It provides guidelines to help employees recognize and resolve ethical issues.

Many individuals caught in misconduct claim that they were "just following orders" from their superiors. What type of power might this reflect on the part of the leader? A. Legitimate power B. Expert power C. Coercive power D. Reward power E. Referent power

Legitimate power

Organizations that reward high performance without considering how the results were achieved are: A. More likely to increase long-term profit margins B. Typically considered better jobs because they don't restrict employees C. Less likely to experience disciplinary issues, because they have fewer rules that can be broken D. More likely to have employees engage in unethical behavior E. Less likely to have employees engage in unethical behavior

More likely to have employees engage in unethical behavior

Which of these is the least likely to influence an individual's personal ethics? A. Religious viewpoints B. Cultures and sub-cultures C. Regulatory guidance D. Ethnic affiliations E. Friends and family

Regulatory guidance

What is organizational ethics? A. Corporate policies and procedures that are used to detect and analyze ethical risk B. Gray areas within the workplace that do not have a right or wrong answer C. An understanding of whether a particular action in the workplace is legal or illegal D. Right or wrong, acceptable or unacceptable conduct in an organizational environment E. A moral code developed through interactions with family, friends, and society

Right or wrong, acceptable or unacceptable conduct in an organizational environment

What constitutes a conflict of interest? A. The firm ignores legitimate concerns of its secondary stakeholders. B. The best interests of an individual are placed above the best interests of the company. C. Employees are abused and become unmotivated to perform. D. Regulators are paid to look the other way when a firm commits misconduct. E. Rewards are provided for increased risk-taking that could damage the firm.

The best interests of an individual are placed above the best interests of the company.

Describe leader-follower congruence. A. The legitimate authority an ethical leader wields over his or her employees B. When followers are forced to follow an organizational leader C. The ability to identify and work with the leader to achieve common ethical objectives D. The power to provide rewards or punish unethical behavior E. The ability of followers to become as powerful as the leader

The legitimate authority an ethical leader wields over his or her employees

Based on our definition, how should companies approach principles? A. They should be a flexible part of a firm's ethical culture. B. Firms should solicit feedback on their importance to ethical conduct. C. Organizations must violate them to succeed. D. Companies should always adjust them according to the local culture. E. There should be zero tolerance for employees to violate them.

There should be zero tolerance for employees to violate them.

Why would it be a mistake to ignore secondary stakeholders? A. They directly impact the firm's daily survival. B. They can be an ally or a threat to an organization. C. They are always critical of large firms. D. They develop laws that could hinder business operations. E. They are more important than primary stakeholders.

They can be an ally or a threat to an organization.

Why might ethics mistakes actually improve an organization in the long-run? A. They learn how to navigate 'gray areas' in such a way as not to get penalties and scrutiny. B. They allow a firm to increase profits from misconduct. C. They give the firm an opportunity to learn from its mistakes. D. They allow the firm to test how far it can go before getting into trouble. E. They enable the firm to get rid of its current management.

They give the firm an opportunity to learn from its mistakes.

What is a characteristic of an ethical leader? A. They make all of the company's ethical decisions. B. They have a passion to do the right thing. C. They consider customers to be the most important stakeholder. D. They consider performance to be the most important factor. E. They micro-manage every facet of a company's operations.

They have a passion to do the right thing.

What similarity do they share that contributes to their firm's ethical cultures? A. Their main goal is to make as much money as possible. B. They rarely make mistakes when it comes to running their companies. C. They have the ability to align employees behind a common vision. D. They run companies that are never criticized by stakeholders. E. They pay their employees more than comparable companies.

They have the ability to align employees behind a common vision.

What is the fate of ethically-challenged CEOs? A. Their organizations go out of business or are acquired. B. They often face reputational damage. C. Recovery is nearly impossible. D. They are dismissed from their positions. E. They usually end up in prison or facing significant fines.

They often face reputational damage.

Why are principles and values so important to companies? A. They provide guidance for employees and leaders in making ethical decisions. B. They always result in the correct ethical decision. C. They prevent a firm from engaging in misconduct. D. They allow a firm to avoid costly fines from regulators. E. They are important in maintaining operational excellence.

They provide guidance for employees and leaders in making ethical decisions.

Which tends to be the most observed misconduct in the workplace? A. Bribery B. Stealing company secrets C. Sexual harassment D. Wide-scale fraud E. Time theft

Time theft

Sam Walton, founder of Wal-Mart, would often travel to different stores across the nation to personally meet employees and praise them for their hard work. By actively promoting a shared vision among employees, Sam Walton was a _________________________. A. Authentic leader B. Transformational leader C. Charismatic leader D. Transactional leader

Transformational leader

Which of the following statements is true about ethics? A. Unethical conduct is not always black and white. B. Ethical decisions are mostly intuitive. C. Ethical leaders are limited to those in authority positions. D. Ethical gray areas are uncommon in decision making. E. A rogue employee has more of an influence on a firm than its culture.

Unethical conduct is not always black and white.

What is the definition of groupthink? A. What occurs when groups from different departments disagree. B. The ability of the team to come up with more diverse solutions to a problem. C. The tendency for conflicts to arise in a group environment. D. When people in a group go along with the group decision. E. The tendency for people in a group to think of the same solutions.

When people in a group go along with the group decision.

An "ethical blind spot" refers to ___________________. A. the feeling that many people have of being less ethical than their peers B. a person's underestimation of his or her own potential to commit misconduct C. the inability of peers to recognize an ethical issue in an organizational context D. the lack of an ethical corporate culture or a formal ethics program in the workplace E. a tendency to overlook ethical misconduct in other people

a person's underestimation of his or her own potential to commit misconduct

Unlike an ethical issue, in an ethical dilemma _____________. A. leadership is not required B. all options are highly unethical C. all answers are highly unclear D. there can be no solution E. all the decisions have negative consequences

all the decisions have negative consequences

What is a necessary component of an ethical corporate culture? A. a socially dominant leader B. rewards for financial performance C. elimination of counter disciplinary procedures D. an ethics program E. exacting management

an ethics program

Countrywide Financial did not appear to care for employees' well-being or the long-term well-being of the firm. It can best be described as having a(n) __________ culture. A. caring B. coercive Your Answer C. apathetic D. exactiny E. integrative

apathetic

While these leaders do not necessarily commit misconduct, they care little for ethics in the company. A. caring leaders B. authentic leaders C. immoral leaders D. integrative leaders E. apathetic leaders

apathetic leaders

Authentic leadership is characterized by leaders who _______________________________. A. influence their followers by offering rewards for desired behavior B. influence individuals with threats of punishment for noncompliance or for undesirable behavior C. set high standards, promote lofty goals, and expect high-quality work from their employees D. are passionate about company goals, display corporate values in the workplace, and form long-term relationships with stakeholders E. act as role models for employees due to their expert power

are passionate about company goals, display corporate values in the workplace, and form long-term relationships with stakeholders

As a company that places employee well-being over company performance, Zappos displays a _________ culture. A. caring B. coercive C. integrative D. exacting E. apathetic

caring

This approach emphasizes obedience to legal requirements. A. caring approach B. values-based approach C. compliance-based approach D. apathetic approach E. integrity-based approach

compliance-based approach

Which of the following information does an ethics audit try to collect? A. employees' perception of the firm's ethical culture B. productivity measurements of different employees C. personal ethics of employees D. financial performance tied to decision making E. educational background of the firm's leaders

employees' perception of the firm's ethical culture

While ________ cultures do not necessarily ignore employee well-being, they tend to emphasize company performance first. A. coercive B. integrative C. apathetic D. exacting E. caring

exacting

Ethical leaders must ____________ ethical issues and risks. A. completely eliminate B. promote C. ignore D. identify E. minimize

identify

Principles, values, _______, and ________ form an organizational culture. A. policies; ethics programs Your Answer B. hotlines; continuous improvement C. norms; artifacts D. artifacts; ethics codes E. ethics codes; ethics training

norms; artifacts

Core practices are ____________________________________. A. an open communication environment in which managers help deal with ethical issues. B. selected by an organization and translated into norms. C. not legally mandated but are considered best practices of the industry. D. those that are externally enforced, such as laws and regulations. E. voluntary boundaries that are established by management.

not legally mandated but are considered best practices of the industry.

A values orientation should possess _________________. A. an emphasis on behavioral monitoring B. no disciplinary procedures C. a strong hierarchy D. few ethical risks E. strong communication systems

strong communication systems

An ethics officer can do little good without _____________________. A. support from top management and board members B. high compensation and adequate training C. formal approval by government officials D. a culture that stresses high performance E. a global supplier code of conduct

support from top management and board members

Leaders who display good character________________________ A. know how to perform most tasks within the organization. B. value character over competence. C. always achieve their goals and objectives. D. place individual values over organizational values. E. take responsibility for ethically meeting stakeholder needs.

take responsibility for ethically meeting stakeholder needs.

Those with an internal locus of control believe __________. A. there is no right decision B. that control can be shared by employees C. that most events are uncontrollable D. that control is limited to those in authority E. they have control over events in their lives

they have control over events in their lives

A transactional leader _____________________________. A. mandates a vision and requires a commitment to organizational goals B. uses an autocratic style of management to lead followers C. discourages dissent and complaints within the organization D. removes employees' ability to participate in ethical decision making E. tries to create employee satisfaction by negotiating for levels of performance

tries to create employee satisfaction by negotiating for levels of performance