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Ethics
for bus5000
| Term | Definition |
|---|---|
| One difference between an ordinary decision and an ethical one | accepted rules or standard practices are not clearly applicable, and the decision-maker must weigh values and diverging perspectives in a situation |
| Business ethics comprises | principles and standards that guide behavior in the world of business. |
| Studying ethics helps business people begin to identify | ethical issues, recognize the approaches available to resolve them, learn about the ethical decision-making process and ways to promote ethical behavior, and understand how to cope with conflicts between personal, organizational, and societal values. |
| The sense that corporations could become too large and have too much power over consumers, workers, and governments led to the enactment of | anti-trust legislation that split up some large firms and prevented others from becoming too powerful. |
| corporate social responsibility | an organization’s obligation to maximize its positive impact on stakeholders and to minimize its negative impact |
| Economist Milton Friedman argued persuasively that | the “business of business” was business, and the primary role of a business was to maximize profits within the rules dictated by governments and society |
| The utilitarian approach suggests that | decisions should be made that result in the greatest good for the greatest number of people, while minimizing any negative consequences to others |
| The moral rights approach suggests that | every human being has some fundamental rights that must always be protected, and that no decision should infringe upon those fundamental rights. |
| The justice approach suggests that | decisions should be guided by impartial standards of fairness and equity |
| To address a loss of confidence in financial reporting and corporate ethics, the U.S. Congress passed | the Sarbanes-Oxley Act. |
| The term ethical culture can be viewed as | the character of the decision-making process that employees use to determine whether their responses to ethical issues are right or wrong |
| Ethical culture is used to describe the component of corporate culture that | captures the rules and principles an organization defines as appropriate conduct. |
| Issues that may foster the development of an ethical climate for employees include | a safe work environment, competitive salaries, and the fulfillment of all contractual obligations toward employees. |
| Investors recognize that an ethical climate provides a foundation for | efficiency, productivity, and profits, while negative publicity, lawsuits, and fines can lower stock prices, diminish customer loyalty, and threaten a company’s long-term viability. |
| An ethical culture that focuses on customers incorporates the interest of | all employees, suppliers, and other interested parties in decisions and actions. |
| A company cannot nurture and develop an ethical organizational climate unless it has achieved | adequate financial performance in terms of profits |
| The Benefits of Business Ethics | employee commitment, investor loyalty, customer satisfaction, profits |
| the authoritative leader | considered to be one of the most effective styles, inspires employees to follow a vision, facilitates change, and creates a strong positive performance climate. |
| Opportunity describes the conditions in an organization that | limit or permit ethical or unethical behavior |
| Those who have influence in a work group including peers, managers, coworkers, and subordinates are referred to as | “significant others”. |
| A corporate culture can be defined as | a set of values, beliefs, goals, norms, and ways of solving problems that members (employees) of an organization share |
| six “spheres of influence” when confronted with ethical choices: | the workplace, family, religion, legal system, community, and profession |
| The intensity of an ethical issue relates to | its perceived importance to the decision-maker |
| The first step in ethical decision-making is to recognize that an ethical issue requires | an individual or work group to choose from several actions that various stakeholders inside or outside the firm will ultimately evaluate as right or wrong. |
| the affiliative leader | values people, their emotions and needs, and relies on friendship and trust to promote flexibility, innovation, and risk-taking. |
| “We” versus “them” is referred to as | self-reference criterion. |
| Cultural relativism is | the concept that morality varies from one culture to another, and business practices are therefore differentially defined as right or wrong by particular cultures. |
| Ethical relativism is | the belief that only one culture defines ethical behavior for the whole globe with no exceptions |
| For the business relativist, there may be | no ethical standards except for the ones in the transaction culture, or none at all |
| one of the more prevalent concerns in international business | discrimination |
| Corporate concern for global human rights emerged in the 1990s as news stories depicting | the opportunistic use of child labor, payment of low wages, and abuses in foreign factories helped reshape our attitudes about acceptable behavior for organizations |
| When a firm charges different prices to different groups of customers, it may be accused of | price discrimination |
| Price discrimination is allowable if | justified based on costs |
| In many cultures, giving bribes, also known as _____, is an acceptable business practice | facilitating payments |
| operate on a global scale with ties to multiple nations and have been the subject of much ethical criticism | MNCs |
| refers to ideas and creative materials people develop to solve problems, carry out applications, educate, and entertain others. | intellectual property |
| The _ addresses economic and social issues involving agriculture, textiles and clothing, banking, industrial standards, services, and intellectual property. It also provides legally binding ground rules for international commerce and trade policy. | world trade organization |
| customers, investors and shareholders, employees, suppliers, government agencies, communities, the media, and many others who have a "stake" or claim in some aspect of a company's products, operations, industry, and outcomes are known as | stakeholders |
| are those whose continued association is absolutely necessary for a firm's survival; these include employees, customers, investors, and shareholders as well as the governments and communities that provide necessary infrastructure | Primary stakeholders |
| do not typically engage in transactions with a company and thus are not essential for its survival; these include the media, trade associations, and special-interest groups. | Secondary stakeholders |
| The degree to which a firm understands and addresses stakeholder demands can be referred to as a | stakeholder orientation |
| This orientation comprises three sets of activities: | the organization-wide generation of data about stakeholder groups and assessment of the firm's interactions with these groups, the distribution of this information , and the organization's responsiveness as a whole to this information. |
| are generally accepted as the most important determinants of performance. | Legal and economic responsibilities |
| Social responsibility is | an organization’s obligation to maximize its positive impact on stakeholders and to minimize its negative impact |
| business ethics involves | carefully thought-out rules or heuristics of business conduct that guide decision-making |
| The International Organization for Standardization (ISO) has tried to establish | a corporate responsibility standard, the ISO 26000. |
| four levels of social responsibility– | economic, legal, ethical, and philanthropic |
| The term _____ is often used to express the extent to which businesses strategically meet the economic, legal, ethical, and philanthropic responsibilities placed on them by their various stakeholders | corporate citizenship |
| officially, the purpose of business is to | maximize profits for shareholders |
| Most firms are moving more toward a __________ as they see that this approach will sustain the relationships necessary for long-term success. | balanced stakeholder model |
| persons placed in positions of trust who use due care and loyalty in acting on behalf of the best interests of the organization | fiduciaries |
| examples of fiduciaries | directors and officers of corporations |
| formal systems of accountability, oversight, and control | corporate governance |
| Control | the process of auditing and improving organizational decisions and actions |
| corporate governance issues | Shareholder rights,Risk management ,Executive compensation,Auditing and control,Board of directors' composition,CEO selection and termination decisions,Integrity of financial reporting,Shareholder participation and input level,Compliance with corporate go |
| The shareholder model of corporate governance | founded in classic economic precepts, including the goal of maximizing wealth for investors and owners |
| One of the biggest issues that corporate boards of directors face is | executive compensation. |
| stakeholder framework in managing responsibility and business ethics. | Assessing the corporate culture Identifying stakeholder groups Identifying stakeholder issues Assessing organizational commitment to social responsibility Identifying resources and determining urgency Gaining stakeholder feedback |
| A ____ is the degree to which a firm understands and addresses stakeholder demands and is comprised of: the generation of data about stakeholder groups and assessment of the firm's interactions with these groups and distribution of this info | stakeholder orientation |
| The Federal Sentencing Guidelines for Organizations (FSGO) | holds corporations responsible for conduct they engage in as an entity |
| Five top recommendations to CEOs for rebuilding trust and confidence in American firms | making customers the top priority, assuming personal responsibility and accountability, communicating openly and frequently with customers, handling crises more honestly, and sticking to the code of business ethics no matter what |
| The Sarbanes-Oxley Act of 2002 established | new requirements for corporate governance to prevent fraudulent behavior in business |
| creates order by requiring that employees identify with and commit to specific required conduct. It uses legal terms, statutes, and contracts that teach employees the rules and penalties for noncompliance. | A compliance orientation |
| strives to develop shared values. Although penalties are attached, the focus is more on an abstract core of ideals such as respect and responsibility | values orientation |
| generally specifies methods for reporting violations, disciplinary action for violations, and a structure of due process | code of ethics |
| a written document that may contain some inspirational statements but usually specifies acceptable or unacceptable types of behavior, is more akin to a regulatory set of rules and, as such, tends to elicit less debate about specific actions. | code of conduct |
| conceived by management and are fully developed with input from all stakeholders | statement of values |
| The six values that have been suggested as being desirable for codes of ethics include | (1) trustworthiness, (2) respect, (3) responsibility, (4) fairness, (5) caring, and (6) citizenship. |
| Most experts agree that one of the most effective methods of ethics training is | exercises in resolving ethical dilemmas that relate to actual situations employees may face in their jobs |
| help lines | can serve as a safety net that increases the chance of detecting and responding to unethical conduct in a timely manner, serve as a central contact point where critical dilemmas can be assigned to the person most appropriate for handling a specific case |
| High-ranking persons known to respect legal and ethical standards that have oversight on organizational ethics programs are known as _______________ | ethics officers |
| members of the board of directors may have a conflict of interest if | they are also an executive of the same company (w) |
| the agency problem, wherein ownership and control of a corporation are separate, is associated with | the shareholder model of corporate governance (w) |
| assessment of corporate culture will help with all of the following except | determining the industry or industries in which a firm should compete (r) |
| a clear delineation of ___ helps employees, customers, investors, government regulators, and other stakeholders understand why and how the organization chooses and achieves its goals | accountability (w) |
| economist ___ argued persuasively that the business of business was business, and that the primary role of a business was to maximize profits within the rules dictated by governments and society | Milton Friedman (w) |
| social responsibility is____ | an organization's obligation to maximize its positive effects and minimize its negative effects on stakeholders (w) |
| most strong organizational climates focus on the value of placing___ interest first | customers' (r) |
| investors recognize that an/a ____ climate provides a foundation for efficiency, productivity, and profits, while negative publicity, lawsuits, and fines can lower stock prices, diminish customer loyalty, and threaten a company's long term viability | ethical (r) |
| which of the following statements about codes of conduct is false? | they guarantee an ethical business climate (r) |
| some corporate ___ cannot be tied to one individual or even a group, and misconduct can be the result of a collective pattern of decisions supported by a corporate culture | outcomes (r) |
| one of the most effective methods of ethics training is ____ | exercises in resolving ethical dilemmas that relate to actual situations employees may face on the job (r) |
| research into compliance-based and values-based approaches reveals that both types of programs can interact or work toward____ but that a values orientation influences employees and creates ethical reasoning among employees | the same end (r) |
| cultural differences in ____ may result in international ethical issues if a businessperson stands far away from a customer during negotiations and the customer regards it as a personal insult | body language (r) |
| ____may adjust to the ethics of a particular foreign culture or use their own culture as a defense against something perceived as unethical in a foreign country | business relativists (w) |
| which of the following prohibits U.S. companies from offering or providing payments to officials of foreign governments for the purpose of obtaining or retaining business abroad? | foreign corrupt practices act (w) |
| which of the following statements is most correct regarding accepted principles of advancing human rights? | be aware of human rights issues and concerns in the home country in which the company engages in business (w) |
| which of the following statements is false regarding strong ethical leaders? | strong ethical leaders are reactive (r) |
| the __ leader values people, their emotions, and their needs, and relies of friendship and trust to promote flexibility, innovation, and risk-taking | affiliative (r) |
| the role of leadership in developing an ethics program includes all of the following except | carefully archiving and not distributing the ethical policies of the firm (r) |
| ___ results from conditions that either provide rewards, whether internal or external, or fail to erect barriers against unethical behavior | opportunity (w) |
| the responsiveness of the organization to __information consists of the initiatives that the firm adopts to ensure that it abides by or exceeds stakeholder expectations and has a positive impact on stakeholder issues | stakeholder (r) |
| philanthropic responsibility | refers to activities that are not required of businesses but promote human welfare or goodwill (r) |
| the three main components of corporate governance are | accountability, oversight, and control (r) |
| in response to calls for businesses to be more socially responsible, the Nobel Prize-winning economist Milton Friedman argued that | the primary role of a business is to maximize profits (r) |
| which of the following is not one of the rewards for being ethical and socially responsible in business? | greater employee turnover (r) |
| which of the following is not a typical activity for an ethics officer? | coordinating the U.S. sentencing commission annual ethics audit (w) |
| all of the following are useful in monitoring ethical conduct and measuring the effectiveness of the ethical program except | firing (r) |
| gouging is | a price increase that exceeds the costs of additional expenditures, such as transportation and taxes (r) |
| discrimination in international business | is often justified on the basis of local cultural norms and values (r) |
| which of the following is not one of the six spheres of influence to which individuals are subject when confronted with an ethical issue? | education (r) |
| it is impossible to agree on ___ judgements about what is ethical | normative (r) |
Created by:
bitchalaureateofscience
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