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Bus Ethics Test 1

Chap. 1, 2, 3, and 4

a part of decision-making at all levels of work and management Ethics
deals with questions of whether practices are acceptable Ethics
comprises principles, values, and standards that guide behavior in the world of business Ethics
occur when accepted rules no longer serve and decision makers must weigh values and reach a judgment Ethical decisions
specific boundaries for behavior that are universal and absolute Principles
used to develop socially enforced norms Values
at least 8 examples of specific issues: Misuse of company resources, abusive behavior, harassment, accounting fraud, conflicts of interest, defective products, bribery, employee theft
4 reasons to study business ethics: 1. have good individual values/morals not enough to stop ethical misconduct 2. training helps provide collective agreement in diverse organizations 3. decisions can be complicated 4. it can help identify ethical issues to key stakeholders
Ethical issue BEFORE 1960 was? theological discussions
Ethical issue DURING 1960 was? social issues in business
led to the new era of consumerism JFK's Consumer Bill of Rights
4 parts of the JFK's Consumer Bill of Rights: 1. to be safe 2. to be informed 3. to be able to choose 4. to be heard
Ethical issue DURING 1970 was? social responsibility
5 issues concerning social responsibility: 1. Bribery 2. Price Collusion 3. Environment 4. Deceptive advertising 5. Product safety
Ethical issue DURING 1980 was? consolidation
the foundation for the Federal Sentencing Guidelines for Organizations Defense Industry Initiative
Ethical issue DURING 1990 was? institutionalization
3 things the Federal Sentencing Guidelines for Organization in 1991 did: 1. set tone for compliance 2. preventive actions against misconduct 3. allowed a company to avoid/minimize potential penalties
6 standards and procedures set by the FSGO: 1. high level of oversight 2. care of delegation of authority 3. effective communication 4. employee training 5. systems to monitor, audit, and report 6. consistent enforcement and improvment
most extensive ethics reform that also increased accounting regulations Sarbanes-Oxley Act (2002)
requires governing authorities to be informed of business ethics programs Federal Sentencing Guidelines for Organizations reforms (04,08,10)
aimed at making the financial industry more transparent/responsible Dodd-Frank Wall Street Reform and Consumer Protection Act (2009)
What is a form's greatest danger not discovering misconduct early
the component of corporate culture that captures the values and norms that an organization defines as appropriate Ethical culture
2 goals of Ethical culture: 1. minimize need for enforced compliance 2. minimize utilization of principles/ethical reasoning
nations working together to establish standards of ethical behavior Global Ethical Culture
one of the most important areas of business today building relationships
what 2 things can a Stakeholder Framework do? 1. helps identify internal and external stakeholders 2. helps monitor and respond to needs values, and expectations of stakeholder groups
the formal system of accountability and control of ethical and socially responsible behavior Corporate governance
those who have a stake or claim in some aspect of a company's product, operations, markets, industry, and outcomes Stakeholder
6 kinds of Stakeholders: customers, employees, investors, suppliers, governing agencies, communities,
those stakeholders whose continued association is necessary for a firm's survival Primary Stakeholders
those stakeholders who are not essential to a company's survival Secondary Stakeholders
an organization's obligation to maximize its positive impact on stakeholders and minimize its negative impact Social responsibility
4 levels of social responsibility: 1. Economic 2. Legal 3. Ethical 4. Philanthropic
involves carefully thought-out rules of conduct that guide decision making Business Ethics
the extent to which businesses strategically meet their economic, legal, ethical, and philanthropic responsibilities Corporate Citizenship
one of an organization's greatest intangible assets with tangible value Reputation
formal system of accountability, oversight, and control Corporate Governance
how closely workplace decisions align with a firm's strategic direction accountability
a system of checks and balances to minimize opportunities for misconduct oversight
the process of auditing and improving organizational decisions and actions control
board members linked to more than one company interlocking directorate
a problem, situation, or opportunity that requires an individual or group to choose among actions Ethical issue
truthfulness or trustworthiness Honesty
the quality of being just, equitable, and impartial Fairness
how wealth or income is distributed Equality
occurs when an action that has an effect upon another is returned Reciprocity
the tradeoff between equity and efficiency Optimization
uncompromising adherence to ethical values Integrity
a problem, situation, or opportunity that requires an individual or group to chose among several wrong or unethical actions Ethical dilemma
one of the most common ethical problems abusive or intimidating behavior
3 types of lies: 1. joking without malice 2. commission lying 3. omission lying
exist when an individual must choose whether to advance his/her personal interests, those of the organization, or some other group Conflicts of Interest
the practice of offering something in order to gain an illicit advantage Bribery
a kind of bribery in that the person who promises or gives the bribe commits the offense Active Bribery
a kind of bribery in that an offense committed by the official who receives the bribe Passive Bribery
legal payments as long as they are small Facilitation payments
the collection and analysis of info on markets, technologies, customers and competitors, and political trends Corporate Intelligence
3 kinds of hacking 1. System hacking 2. Remote hacking 3. Physical hacking
4 reasons a company can be sued for discrimination 1. refuses to hire for discriminatory reasons 2. unfairly excludes person from employment 3. unreasonably discharges an individual 4. discriminates against an person with respect to hiring, employment terms, promotion, or privilege
EEOC stands for what? Equal Employment Opportunity Commission
Efforts to recruit, hire, train, and promote qualified individuals from groups that have traditionally been discriminated against Affirmative Action Programs
A repeated, unwanted behavior of a sexual nature perpetrated upon an individual by another Sexual Harassment
3 things that make a hostile work environment 1. The conduct was unwelcome 2. The conduct was severe, pervasive, and regarded by claimant as hostile/offensive 3. The conduct was such that a reasonable person would find it hostile or offensive
A personal, loving, and/or sexual relationship with someone with whom you share professional responsibilities Dual Relationship
The relationship causes a conflict of interest or impairment of professional judgment Unethical dual relationship
To Avoid Sexual Misconduct, a Firm Needs 7 of the following: Statement of policy Definition of sexual harassment Non-retaliation policy Specific procedures for prevention Establish, enforce, and encourage victims to report Establish a reporting procedure Timely reporting requirements to the proper authorities
An international treaty on climate change that commits nations to reducing greenhouse gas emissions The Kyoto Protocol
Any purposeful communication that deceives, manipulates, or conceals facts in order to create a false impression Fraud
4 examples of Accounting fraud: 1. Misrepresentation of company’s financial reports 2. Dramatic changes in accounting field 3. Increased competition and pressures to perform can create opportunities for misconduct 4. Accountants should abide by a strict code of ethics
The process of dishonestly creating, distributing, promoting, and pricing products Marketing Fraud
Exaggerated advertising claims, blustering, and boasting Puffery
An advertising message that misleads, confuses, or deceives the public Implied falsity
Claims can be divided into tests prove and bald assertions (non-establishment claims) Literally false
When consumers attempt to deceive businesses for personal gain Consumer Fraud
involves an employee who helps a consumer commit fraud Collusion
involves a consumer duping a store Duplicity
is associated with a person who uses tricks to obtain an unfair advantage Guile
The failure to understand and manage ethical risks was a key problem in the recent financial crisis Financial Misconduct
insider trading that Involves legally buying and selling stock in an insider’s own company, but not all the time Legal insider trading
insider trading that is the buying or selling of stocks by insiders who possess material that is not public Illegal insider trading
Involve the legal protection of intellectual properties Intellectual Property Rights and Privacy
Most ethical issues become visible through? stakeholder concerns
The ethical decision making process starts when ______ ______ ___________ occurs and a discussion begins. ethical issue awareness
3 dimensions to effective business compliance: 1. Voluntary practices 2. Core practices 3. Mandated boundaries
Include beliefs, values, and voluntary contractual obligations of a business Voluntary practices
Documented best practices, often encouraged by legal and regulatory forces and trade associations Core practices
Externally imposed boundaries of conduct (e.g. laws, rules, and regulations) Mandated boundaries
Laws and regulations established by governments Legal Compliance
the rights and duties of individuals and organizations Civil law
prohibits specific actions and imposes punishments for breaking the law Criminal law
5 categories of laws: 1. Regulating competition 2. Protecting consumers 3. Protecting equity and safety 4. Protecting the environment 5. Incentives to encourage organizational compliance programs
because they encourage competition and prevent activities that restrain trade procompetitive legislation
Laws passed to prevent the establishment of monopolies, inequitable pricing, and other practices that reduce or restrict competition among businesses Laws Regulating Competition
Laws protecting consumers require businesses to provide accurate information about products and services and to follow safety standards Laws Protecting Consumers
protects consumers against unfair, deceptive, or fraudulent practices FTC’s Bureau of Consumer Protection
regulates food safety, human drugs, and tobacco, among other things FDA
Laws promoting equity in the workplace protect the rights of minorities, women, older persons, and disabled persons Laws Promoting Equity and Safety
4 items that promote equity and safety: 1. Title VII of the Civil Rights Act 2. Equal Employment Opportunity Commission 3. Affirmative action programs 4. The Equal Pay Act
makes inspections to ensure a safe working environment Occupational Safety and Health Administration (OSHA)
Laws created in response to stakeholder concerns about businesses’ impact on environment Laws Protecting the Environment
2 things regarding sustainability: 1. Meeting the present needs without compromising future generations’ abilities to meet their own needs 1. Being a green company can boost profits
created to coordinate environmental agencies Environmental Protection Agency (EPA)
the glue that holds businesses together Trust
Overseers of business actions Gatekeepers
A group that failed in its duties to stakeholders during the most recent recession Risk Assessors
Established a system of federal oversight of corporate accounting practices The Sarbanes-Oxley (SOX) Act
Seeks to improve financial regulation, increase oversight, and prevent excessive risk-taking and deceptive practices Dodd-Frank Wall Street Reform and Consumer Protection Act
Passed as an incentive for organizations to develop and implement programs for ethical and legal compliance Federal Sentencing Guidelines for Organizations
Focuses on developing sound organizational practices and structural integrity for performance measures Highly Appropriate Core Practices
4 major benefits to voluntary responsibilities: 1. Improves quality of life in communities 2. Reduces government involvement 3. Develops employee leadership skills 4. Helps create an ethical culture
Ties an organization’s product(s) to a social concern through a marketing program Cause-related marketing
The synergistic and mutually beneficial use of a company’s core competencies and resources to deal with social issues Strategic philanthropy
Involves embedding values, norms, and artifacts in organizations, industries, and society The Importance of Institutionalization in Business Ethics
The failure to _______ _______ ________ core practices provides the opportunity for unethical conduct understand highly appropriate
Created by: Alex Fleming



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