Applied Ethics Chapters 1 – 10 Study Questions

Having all the effective mechanisms listed on the corporate governance checklist in place ensures completely effective corporate governance.
False

Corporate governance is the system by which business organizations are directed and controlled.
True

The Cadbury report argued for a guideline of “comply or else,” which required companies to abide by a set of operating standards or face stiff financial penalties.
False

If the board of directors is to serve its purpose in setting the operational tone for an organization, it should be comprised of members who represent professional conduct in their own organizations.
True

Permitting one individual to function as both the chief executive officer of a company and the chairperson of its board has no impact upon the power of the stockholders.
False

Board members are not accountable to the company and its shareholders.
False

The King II report on corporate governance:
formally recognized the economic, environmental, and social aspects of a company’s activities.

In what way did the “comply or else” ¬approach differ from the “comply or explain” approach to corporate governance?
Unlike “comply or explain”, the “comply or else” approach does not offer corporations an easy way to avoid conforming to its operating standards.

One of the flaws in the board of directors of Enron was that many of the directors were affiliated with organizations that benefited directly from Enron’s operations.
True

Independent or outside directors are not eligible to be a part of the compensation committee.
False

The Sarbanes-Oxley Act of 2002 incorporates the “comply or else” approach to corporate governance.
True

Which of the following is true of managers in an organization with good corporate governance?
Managers should fulfill a fiduciary responsibility to the owners.

The King II report emphasized the need for companies to adopt an exclusive approach to corporate governance instead of an inclusive one.
False

Which of the following is true of the “comply or explain” approach to corporate governance?
It gave companies the flexibility to comply with its governance standards or justify why they didn’t in their corporate documents.

The outside members of a company’s board of directors:
may comprise of the company’s creditors, suppliers, or consultants.

Which of the following actions is a step toward running a company successfully?
Evaluating risk-versus-reward scenarios frequently, regardless of the company’s size.

The corporate governance committee is staffed by members of the board of directors and specialists.
True

In his Harvard Business Review article, Walter Salmon recommends that a good board have three or more outside directors for every insider.
True

The Cadbury report addressed:
the financial aspects of corporate governance.

The _____ of 2002 incorporates the “comply or else” approach to corporate governance.
Sarbanes-Oxley Act

“Business ethics” is sometimes considered an oxymoron because:
the recent spate of financial scandals portrays organizations as fundamentally unethical.

Codes of ethics have matured from performance-measurement documents into cosmetic public relations documents.
False

The standard of corporate governance:
ensures that officers of an organization fulfill their obligations to their stakeholders.

The belief that an activity is safe because it will never be found out is a common rationalization behind an employee’s unethical conduct. What can an organization do to deter unethical behavior based on this rationalization?
Managers should punish the individual publicly.

The 2002 Sarbanes-Oxley Act introduced greater accountability for chief executive officers and boards of directors in signing off on the financial performance records of the organizations they represent.
True

Which of the following functions does the code of ethics perform?
It clarifies an organization’s cornerstones to its employees, managers, and stakeholders.

_____ refers to a situation in which there is no obvious right or wrong decision, but rather a right or right answer.
Ethical Dilemma

The problem with a utilitarian approach to ethics is:
the idea that the ends justify the means.

The _____ principle for resolving an ethical dilemma considers which decision would provide the greatest good for the greatest number of people.
ends-based

The difference between intrinsic value and instrumental value is that:
instrumental value refers to the quality by which the pursuit of one value is a good way to reach another value.

The interests of wholesalers in an organization include accurate deliveries of quality products on time and at a reasonable cost.
True

Which of the following is one of the four basic categories of ethics?
Personal integrity

Joe feels pressured to lie to his client to keep an important contract because of intense market competition. He feels they will never discover the truth. Joe is:
facing an ethical dilemma.

Ethical behavior should be the same both inside and outside a business situation.
True

Moral standards are independent of religious beliefs.
False

Which of the following is an example of simple truth?
Amelia believes that murder is wrong, a view supported by most people.

A company’s code of ethics comprises written standards of moral behavior that are designed to guide managers and employees in making the decisions and choices they face every day.
True

The belief that an activity is safe because it will never be found out or publicized is one of the commonly held rationalizations, identified by Saul Gellerman, which can lead to unethical behavior.
True

The basic assumption of ethical theory is that you as an individual or community are in control of all the factors that influence the choices that you make.
True

The highest level of ethical reasoning is the postconventional level.
True

The third stage of Kohlberg’s stages of ethical reasoning is law-and-order orientation.
False

When trying to resolve an ethical dilemma, the Golden Rule principle considers only legal aspects of the problem.
False

A society is a closed, confined unit in which people have to follow a distinct religion.
False

Which of the following changes has occurred in the business environment over the last five decades?
Corporate social responsibility has advanced from an abstract debate to a core performance-assessment issue.

Arthur Dobrin identified 15 questions that one should consider when resolving an ethical dilemma.
False

Business ethics can be approached from two different perspectives. The _____ perspective is a summation of the customs, attitudes, and rules that are observed within a business.
descriptive

Utilizing the rules-based principle to resolve an ethical dilemma necessitates focusing exclusively on which decision would provide the greatest good for the greatest number of people.
False

A _____ is defined as someone with a share or interest in a business enterprise.
stakeholder

Business ethics involves the application of standards of moral behavior to business situations.
True

An intrinsic value means that the pursuit of one value is a good way to reach another value.
False

Individuals acquire their personal moral standards in the same way that they learn the alphabet.
False

Over the last five decades, the issue of corporate social responsibility has advanced from an abstract debate to a core _____ issue with clearly established legal liabilities.
performance-assessment

_____ refers to a set of personal principles formalized into a code of behavior.
Value system

International ethics centers that serve the needs of global businesses were formed in the 1960s.
False

Which of the following scenarios exemplifies instrumental value?
Victoria possesses half a million in her bank account.

How can companies reduce unethical behavior in their companies?
By creating and maintaining a corporate culture of trust

Business ethics:
involves applying ethical and moral standards to business behavior.

Which of the following is true of ethical relativism?
The idea of relativism implies some degree of flexibility as opposed to strict black-and-white rules.

Which of the following is true of corporate governance?
It is the system by which business corporations are directed and controlled.

The Greek philosopher Aristotle’s belief in individual character and integrity established the concept of _____.
virtue ethics

Corporations that experiment with corporate social responsibility (CSR) initiatives run the risk of creating adverse results as:
the employees feel that they are working for an insincere, uncaring organization.

The policy of _____ is the premise of corporate social responsibility where doing what’s best for the customers translates into what’s best for the company in the long run.
doing well by doing good

The human resource function within an organization should ideally be directly involved in the creation of a career development program for the employee.
True

ExoticCrafts Inc., a handicraft manufacturing company, has an established marketing department. Which of the following functions is the marketing department most likely to carry out?
Ensuring that the products reach the hands of a satisfied customer.

Instrumental approach to corporate management is the perspective that a corporation has obligation to society over and above the expectations of its shareholders.
False

According to the value chain of an organization, which of the following is a support activity?
General administration

According to the value chain of an organization, which of the following is classified as a primary activity?
Sales and marketing

The human resource function within an organization seldom needs to be involved in the relationship between the company and the employee.
False

The policy of “doing well by doing good,” refers to the belief that doing good for the company is just good business.
False

Which of the following statements is true of a company’s value chain?
Supply chain management and operations are primary activities.

Nonprofit organizations do not face problems with unethical behavior.
False

Which of the following statements is true of corporate social responsibility (CSR)?
Many companies awoke to CSR only after being surprised by public responses to issues they had not previously thought were part of their business responsibilities.

In addition to achieving social benefits, which of the following best illustrates that a company is effectively implementing corporate social responsibility (CSR)?
The company fulfills its legal obligations

The accounting function provides the certification, by an impartial third-party professional, that an organization’s financial statements are accurate.
False

Marketing professionals are responsible for ensuring that the right programs and policies for ethical business conduct are in place.
False

According to the social contract approach to management, by recognizing _____ and not just shareholders, corporations must maintain a long-term perspective rather than simply delivering quarterly earnings numbers.
stakeholders

The obligation that an auditing firm has to a paying client while owing an objective, third-party assessment of that client’s financial stability to stakeholders and potential investors represents a potentially significant conflict of interest.
True

When a company’s financial statements have been certified by an objective third party to be “clean,” that certification is meant to be for the public’s benefit rather than the company’s.
True

Which of the following arguments made by the advocates of ethical business conduct about the human resource department is true?
It should not be the sole creator of the code.

The research and development (R&D) department of an organization:
carries the responsibility for the future growth of the organization.

Henry Ford II recognized the fact that corporations operate in an isolated environment.
False

Cathy heads the R&D team of Anderson Enterprises. Which of the following R&D functions should Cathy and her team undertake in the firm to allow the organization capture and maintain a leading position in its market?
Cathy and her team should make a complex set of risk assessments and technical judgments in order to deliver a product design.

Corporate social responsibility assumes that the corporation:
is operating in a competitive environment.

Ethical CSR is a philanthropic approach to corporate social responsibility in which organizations underwrite specific initiatives to give back to the company’s local community or to designated national or international programs.
False

Some of the illegal financial functions include underreporting income, overvaluing assets, and taking questionable deductions.
True

Corporate Social Responsibility (CSR) refers to the actions of an organization that are targeted toward achieving a social benefit over and above maximizing profits for its shareholders and meeting all its legal obligations.
True

The advocates of ethical business conduct argue that HR should be the sole creator of any corporate code of ethics.
False

In contrast to the alleged immorality of altruistic CSR, critics argue that strategic CSR is ethically commendable since these initiatives benefit stakeholders while meeting fiduciary obligations to the company’s shareholders.
True

There are several standard ways to measure the achievements of the triple bottom-line approach.
False

Organizational culture can be defined as the values, beliefs, and norms shared by all the employees and competitors of that organization.
False

Happy Times (HT) is an alcohol manufacturing brand that manufactures and sells several types of alcoholic beverages. HT uses social media for promoting the message of responsible drinking. It sponsors the FreeTaxi program for customers with HT membership on Christmas and New Year’s Eve. It has also initiated several community welfare projects where a percentage of the profits go to the Hunger Relief Fund for Children. Which of the following aspects of Happy Times is illustrated in this scenario?
Corporate citizenship

Amanda heads the human resource department in Elenear Enterprises. The management has entrusted her with certain functions. Within the organization, Amanda should be directly involved in:
the recruitment and selection of the right candidates for different positions.

Human resource management supports each of the key functional areas in a value chain.
True

Which of the following approaches to corporate management is considered simplistic because it assumes that there are no external consequences to the actions of a corporation?
The instrumental approach

Bector Airlines supports relief camps in the Republic of Cadmia with donations of both money and employee-donated volunteer hours. It also provides packaged food in times of natural crises such as hurricanes, earthquakes, etc. This is an example of _____ CSR.
altruistic

According to Joseph F. Keefe, which of the following is a major trend behind the corporate social responsibility phenomenon?
Globalization

If an employee leaves a company, the human resource department should host an exit interview to ensure that anything that the organization can learn from the employee’s departure is fed back into the company’s strategic plan for future growth and development.
True

Which of the following is a human resource function within an organization?
Documentation of periodic performance reviews

Spark Inc. (SI), a multinational corporation, had reported large losses in the previous financial year. To overcome these losses, the company planned to take the instrumental approach to corporate management. Which of the following best illustrates this approach?
SI uses its resources to enhance the productivity of employees and thus increases profits.

The advocates of ethical business conduct argue that HR should be at the center of any corporate code of ethics.
True

For the R&D team, the real ethical dilemmas come when decisions are made about product quality.
True

Which of the following illustrates a firm having a triple bottom-line (3BL) approach?
Brink-T Technologies donates ten percent of its profit to charity, reduces toxic emission from its plants, and has ten percent increase in financial turnovers.

The Kyoto Protocol requires developed nations to reduce their greenhouse gas emissions only by modifying their domestic industries.
False

The _____ to corporate management refers to the perspective that a corporation has an obligation to society over and above the expectations of its shareholders.
social contract approach

Which of the following is an example of corporate social responsibility?
Dawson Inc. uses clean-fuel technology shuttle for employee conveyance.

The practices of making a company’s operations _____, to offset damage to the environment through their greenhouse gas emissions, was initially developed as a solution for those industries that face significant challenges in reducing their emissions.
carbon neutral

Which of the following best illustrates the social contract approach to corporate management?
At Redder Enterprises, employees’ wages have grown at a higher rate than inflation.

Ethical CSR is the purest or most legitimate type of CSR.
True

There are four distinctive types of corporate social responsibility (CSR)—economic, ethical, altruistic, and strategic.
False

The human resource function of an organization can be divided into two distinct areas: financial transactions and accounting function.
True

Finance is a key function in a value chain.
False

The _____ to corporate social responsibility assumes that there are no external consequences to the actions of the corporation and its managers.
instrumental approach

One of the newest and increasingly questionable practices in the world of CSR is the notion of making operations “carbon neutral.”
True

Which of the following statements is true of the social contract approach to corporate management?
The modern social contract approach argues that there is an obligation for the corporation to meet the demands of the society rather than just the demands of a targeted group of customers.

Which of the following statements is true of the financial functions of an organization?
The accounting function keeps track of all those financial transactions by documenting the money coming in and money going out and balancing the accounts at the end of the period.

Critics have argued that, from an ethical perspective, altruistic CSR is immoral since it represents a violation of shareholder rights if they are not given the opportunity to vote on the initiatives launched in the name of corporate social responsibility.
True

Joseph F. Keefe asserts that there are three major trends behind the corporate social responsibility phenomenon.
False

Emissions credits are fixed for every market, and they cannot be bought or sold.
False

With the transition to an information-based economy, consumers and investors have more information at their disposal than at any time in history.
True

Which of the following statements is true of ethical challenges in organizations?
Profit is the main reason behind bending the rules regularly in the workplace.

Utilitarianism refers to the theory that suggests actions are taken out of duty and obligation to a purely moral ideal, rather than based on the needs of the situation.
False

Research and development (R&D) professionals carry the responsibility for the future growth of the organization.
True

If an employee leaves a company, the _____ department should host an exit interview to ensure that anything the organization can learn from the employee’s departure is fed back into the company’s strategic plan for future growth and development.
human resource

Strategic CSR runs the greatest risk of being perceived as self-serving behavior on the part of the organization.
True

Friedman’s view of the corporate world supports the rights of individuals to make money with their investments.
True

The accounting profession is governed by a set of laws and established legal precedents.
False

Merging the roles of the chief executive officer and the chairperson of the board is inadvisable because:
the power of the stockholders is minimized.

The board of directors of a company:
oversees the governance of the organization.

Which of the following principles should a company follow for effective corporate governance?
The board of directors and the CEO should work together when evaluating risk-versus-reward scenarios.

Corporate governance is concerned with how well an organization meets its obligations to its stakeholders.
True

Studies show that a commitment to good corporate governance makes a company both more attractive to investors and lenders, and more profitable.
True

What did the King I and King II reports have in common?
They both incorporated a code of corporate practices that looked beyond corporations.

The “comply or explain” methodology refers to the set of guidelines that requires companies to abide by a set of operating standards or face stiff financial penalties.
False

The corporate governance committee of a company oversees compliance with the company’s internal code of ethics as well as any federal and state regulations on corporate conduct.
True

Which of the following is true of the King I report?
It considered corporations’ impact on the larger community.

In what way did the “comply or else” approach differ from the “comply or explain” approach to corporate governance?
Unlike “comply or explain”, the “comply or else” approach does not offer corporations an easy way to avoid conforming to its operating standards.

The King II report formally recognized the need to move the stakeholder model forward and to consider a triple bottom line instead of a single bottom line of profitability.
True

Poor corporate governance:
weakens a company’s potential and makes it less attractive to investors.

Why was the “comply or explain” approach to corporate governance problematic?
Its definition of what constitutes an acceptable explanation for not complying was vague.

The “comply or else” guideline gave companies the flexibility to comply with governance standards or explain their noncompliance in their corporate documents.
False

By merging the roles of the chief executive officer and the chairperson of the board, the oversight provided by the board of directors is magnified.
False

The ethical conduct of a business can be influenced by the individual personalities involved.
True

Do unto others as you would have them do unto you explains the _____.
golden rule

The process of ethical reasoning involves looking at the available information and then drawing conclusions based on that information in relation to our own ethical standards.
True

Alison Anderson, the CEO of Anderson Inc., laid the foundation for an apt professional behavior in her workplace. She was honest, aware, and sensitive and is considered a role model by young entrepreneurs. Which of the following basic categories of ethics is depicted in this scenario?
Personal integrity

The positive outcome of the awareness generated by unethical behavior in the business world has been increased attention to the need for third-party guarantees of ethical conduct and active commitments from the rest of the business world.
True

Corporate governance is the system by which businesses are directed and controlled.
True

_____ is the system that directs and controls business organizations.
Corporate governance

Which of the following is the lowest level of moral development in Lawrence Kohlberg’s stages of ethical reasoning?
Preconventional

The Ethics Resource Center defines a code of ethics as a central guide to support day-to-day decision making at work.
True

An organization’s code of ethics has no relevance to its employees.
False

The problem with utilitarianism is the focus on doing the most good for a select few, such as Adolf Hitler and his idea of launching a national genocide against Jews on the ethical grounds of restoring the Aryan race.
False

According to Kohlberg’s framework, an individual can jump beyond the next stage of his or her six stages.
False

Which of the following statements accurately explains the basic categories of ethics?
Personal integrity, a category of ethics, looks at ethics from an external rather than an internal viewpoint.

The problem with virtue ethics is that:
societies can place different emphasis on different virtues.

Which of the following is true of corporate ethics?
It has moved from the domain of legal departments into the organizational mainstream.

Ethics for the greater good is also referred to as utilitarianism.
True

The basic assumption of ethical theory is that:
a person as an individual or community is in control of all the factors that influence the choices they make.

The three principles by which ethical dilemmas are resolved are successful in all situations.
False

The terms morals is applied to a society while the term values is used when referring to an individual.
False

Which of the following is true of business ethics?
Business ethics should not be applied as a separate set of moral standards or ethical concepts from general ethics.

Which of the following will most likely influence the moral standards of an individual?
A strict family upbringing

Which of the following is a problem with the universal ethics approach?
The problem with this approach is the reverse of the weakness in ethics for the greater good.

Preconventional is the lowest level of Lawrence Kohlberg’s stages of ethical reasoning.
True

Utilizing the ends-based principle to resolve an ethical dilemma necessitates focusing solely on the decisions that other people in your situation would arrive at.
False

Which of the following is true of stakeholders?
Not every stakeholder is relevant in every business situation.

An organization’s code of ethics has no relevance to its stakeholders.
False

Ethical dilemmas are the study of how ethical theories are put into practice.
False

Kohlberg stated that it would be impossible for a person to comprehend the moral issues and dilemmas at a level so far beyond his or her life experience and education.
True

Once the type of ethical conflict has been determined, there are two principles by which it can be resolved: Volcker’s Rule and Campbell’s Rule.
False

An oxymoron is the combination of two facts that mirror and support each other.
False

Which of the following is the final step of the three-step process for solving an ethical problem?
Make a decision

The code of ethics adapted by the _____ speaks about doing no harm, fostering trust, and improving “customer confidence in the integrity of the marketing exchange system.”
American Marketing Association

Prior to the passing of the Foreign Corrupt Practices Act, unethical corporate behavior was regulated by the _____, which required full disclosure of funds that were taken out of or brought into the United States.
Bank Secrecy Act

Under the Foreign Corrupt Practices Act, facilitation payments are payments that are acceptable (legal), provided they expedite or secure the performance of a routine governmental action.
True

Title III of the Sarbanes-Oxley Act requires senior auditors to rotate off an account every five years, and junior auditors every seven years.
False

Why was the Foreign Corrupt Practices Act criticized?
The act formally recognizes the facilitation payments, which would otherwise be acknowledged as bribes.

Which of the following is true of the Federal Sentencing Guidelines for Organizations (FSGO)?
The FSGO includes an exhaustive list of covered business crimes.

In what way do bribes differ from grease payments under the FCPA?
Unlike grease payments, bribes induce officials to act in violation of their lawful duty.

Which of the following is true of the penalties under the Foreign Corrupt Practices Act?
Officers, directors, stockholders, employees, and agents are subject to a fine of up to $250,000 per violation and imprisonment for up to five years.

The _____ is a government agency within the Federal Reserve that oversees financial products and services.
Consumer Financial Protection Bureau

The _____ refers to the legislation that was promoted as the “fix” for the extreme mismanagement of risk in the financial sector that led to a global financial crisis in 2008-2010.
Dodd-Frank Wall Street Reform and Consumer Protection Act

Title VIII of the Sarbanes-Oxley Act imposes fines on employees for lying to other employees regarding company benefits and pay.
False

Under no circumstances can the culpability score be increased or decreased.
False

The processing of governmental papers, such as visas, is an example of a routine governmental action.
True

Under the FGSO, the death penalty:
holds businesses liable for the criminal acts of their employees and agents.

The _____ is a government agency established to prevent banks from failing and otherwise threatening the stability of the U.S. economy.
Financial Stability Oversight Council

Which of the following is one of the key pieces of U.S. legislation designed to discourage, if not prevent, illegal conduct within businesses?
The U.S. Federal Sentencing Guidelines for Organizations

The culpability score, according to the Federal Sentencing Guidelines for Organizations, is the calculation of the organization’s degree of blame or guilt and is a multiplier of the base fine up to 40 times.
False

Title IX of the Sarbanes-Oxley Act requires CEOs and CFOs to certify their periodic reports and imposes penalties for certifying a misleading or fraudulent report.
True

Under the Federal Sentencing Guidelines for Organizations, a judge has the discretion to impose the “death penalty” upon an organization, where the fine matches all the organization’s assets.
True

The Financial Stability Oversight Council is led by the Treasury secretary and is made up of top financial regulators.
True

Tracking the history of internal whistle-blowing is easier than tracking the history of external whistle-blowing.
False

Keystroke loggers can only capture information that is not deleted.
False

The primary reason for the enactment of the Civil False Claims Act was to:
protect the government from fraudulent defense contractors.

If an employee’s personal value system prompts him or her to speak up about the misconduct of the organization he or she works for, the employee takes on the role of a whistle-blower.
True

Which of the following is a difference between internal and external whistle-blowing?
Unlike external whistle-blowing, the history of internal whistle-blowing is more difficult to track.

The Whistleblower Protection Act of 1989 is also known as the Corporate and Criminal Fraud Accountability Act.
False

Before the Whistleblower Protection Act of 1989 was passed, whistle-blowers weren’t entitled to any sort of monetary reward from the government.
False

Which of the following is a disadvantage of technological advances in a workplace?
Loss of privacy

The argument over privacy at work has traditionally centered on:
the amount of time that employees were on-site.

Telecommuting does not allow employees any degree of flexibility in terms of the location from which they work.
False

Emily, a website designer, is hired by an organization to create an internal website that contains information meant to be accessed solely by employees. This website is the company’s _____.
intranet

According to Adam Moore, consent given by employees with little choice is referred to as thick consent.
False

The Sarbanes-Oxley Act of 2002 is also known as:
the Corporate and Criminal Fraud Accountability Act.

One of the ways in which multinational corporations lower their expenses is by shipping work to countries with lower labor costs.
True

Which of the following is an argument against creating a “locked-down” work environment?
Employees who resent being constrained might leave the company.

Under the federal Civil False Claims Act, whistle-blowers are referred to as “relators.”
True

Cyberliability applies the existing legal concept of liability to the field of computers.
True

The Whistleblower Protection Act of 1989 introduced a new reward program for whistle-blowers who report securities law violations to the Securities and Exchange Commission (SEC) or the Commodity Futures Trading Commission (CFTC).
False

_____ whistle-blowing involves an employee bringing the organization’s misconduct to the attention of his or her manager or supervisor.
Internal

Whistle-blowing is not considered ethical under any circumstances.
False

Customer service calls and computer tech support are examples of services that cannot be outsourced to another country.
False

Becoming a whistle-blower and taking the story public should be seen as the first resort rather than the last.
False

The _____ of 1989 guaranteed the anonymity of federal employees, but not that of other employees.
Whistleblower Protection Act

The abbreviation “qui tam” establishes a whistle-blower as a deputized petitioner for the government in cases that expose fraudulent behavior of companies.
True

A whistle-blower is an individual who discovers corporate misconduct and chooses not to do anything about it.
False

Which of the following explains why employers are in favor of monitoring and restricting the actions of their employees?
The implications of vicarious liability for employers

If there is evidence that the employee is motivated by the opportunity for financial gain, the legitimacy of his or her whistle-blowing should be questioned.
True

If there is evidence that the employee is carrying out an individual vendetta against the company, the legitimacy of his or her whistle-blowing should be questioned.
True

It is argued that the actions of whistle-blowers are not always motivated by their integrity, but by money or by their egos.
True

Under the Dodd-Frank Wall Street Reform and Protection Act of 2010, a whistle-blower is penalized stiffly for acting against the Commodity Futures Trading Commission.
False

Sending digitized information across fiber-optic wires raises no ethical questions.
False

Which of the following is true of telecommuting?
It allows employees a certain degree of flexibility in terms of their work hours.

Technological advances over the last two decades have made it more difficult to pass the personal data of customers from one place to another.
False

A whistle-blower hotline is a telephone line where employees can leave messages to alert the _____ of suspected corporate misconduct without revealing their identity.
company

According to the legal concept of cyberliability, employers can be held liable for the actions of their employees through Internet communications to the same degree as if they had written those communications on company letterhead.
True

Which of the following is true of the False Claims Act of 1863?
It was designed to prevent profiteering from the Civil War.

Under federal law, video surveillance is legal only if:
the camera focuses on publicly accessible areas.

Which of the following is a benefit of telecommuting?
Employees have the flexibility of taking care of their personal needs during work hours.

Packet-sniffing software can be used to monitor employees’ private accounts, as long as they are accessed on workplace networks or phone lines.
True

The availability of ongoing technological advancements has made it easier to determine precisely where work ends and personal life begins.
False

Derek oversees the investigations of wrongdoings in his organization and provides additional guidance and support to the employees. He also develops training programs for every department to maintain organizational conduct. Which of the following positions does Derek most likely hold in his company?
Ethics officer

The guidelines set down by the Organization for Economic Cooperation and Development are legally binding.
False

Which of the following is a characteristic of demanding creditors?
demanding the firm to pay loans on time

Typical markets represent federal, state, and local officials who simplify and reduce rules and regulations, thus discouraging firms from hiring more people and paying more taxes.
False

The UN Global Compact, which encourages organizations to make a voluntary commitment to corporate citizenship, is widely recognized as the world’s largest initiative of its kind.
True

A developed nation is a country that enjoys a high standard of living as measured by economic, social, and technological criteria.
True

Which of the following is true of utilitarianism?
It leads to situations in which there is no accountability for individual actions.

After hiring an ethics officer, which of the following is the immediate next stage in making ethical behavior sustainable for a company?
Rewarding ethical behavior demonstrated by employees

Multinational corporations are also known as intranational corporations.
False

Which of the following is true of the UN Global Compact?
It serves as a guideline for transparency and public accountability.

Which of the following statements is true of an ethics officer?
An ethics officer monitors the ethical performance of the organization both internally and externally.

According to the Ethics and Compliance Officers Association survey, which of the following is ranked lowest in the category of the main responsibilities of an ethics officer?
Conducting investigations of wrongdoing

Multinational corporations include those corporations that generate products and/or services in multiple countries and implement operational policies (marketing, staffing, and production) that go beyond national boundaries.
True

The UN Global Compact deals exclusively with two key areas of concern: fair pricing and customer satisfaction.
False

A multinational corporation is a company that provides and sells products and services across multiple national borders.
True

It is important to establish an extensive training program to support the published code of ethics of a company.
True

Globalization raises concerns about the:
ethical behavior of economically advanced nations toward developing ones.

Utilitarianism refers to:
ethical choices that consider the greatest good for the greatest number of people.

A company should avoid communicating its ethics policy to external stakeholders.
False

Ethical Relativism refers to the gray area in which ethical principles are defined by the traditions of society, personal opinions, and the circumstances of the present moment.
True

As per the labor standards of the UN Global Compact, businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining.
True

In what way has globalization affected the economy?
National markets are being overtaken by regional trade blocs.

A carefully “wordsmithed” document and carefully positioned press releases suggest that an organization is strictly following the policy of transparency.
False

How can an organization move its ethical commitment to a global scale successfully?
By creating an ethical standard that respects the local customs of the other countries.

The role of an ethics officer is to enforce the code of ethics and provide support to any employees who witness unethical behavior.
True

The audience for the code of ethics of an organization includes only its employees.
False

Which of the following is true of the guidelines offered by Richard DeGeorge for organizations doing business in other countries?
His guidelines represented an ethical ideal that, at best, provided a conceptual foundation.

A code of ethics is a guide for employees that covers every possible event.
False

The UN Global Compact:
is the largest initiative of its kind in the world.

The term “globalization” has applications in commercial, economic, social, and political environments.
True

Which of the following is a disadvantage of globalization?
Multinational corporations are depleting the natural resources of less-developed countries.

What is the UN Global Compact?
It is a voluntary corporate initiative that addresses the main concerns of globalization.

Which of the following concepts is illustrated by a company which, when doing business abroad, takes advantage of the local customs to justify an action that is illegal in its home country?
Ethical relativism

A transparent organization tends to avoid open and honest communication with all its stakeholders.
False

Globalization refers to the expansion of international trade to a point where, across the globe, regional trade blocs have overtaken national markets.
True

The difference between reactive and proactive policies is that:
reactive policies are driven by events and/or a fear of future events, whereas proactive policies are driven by a clear sense of what is construed as ethical for the organization.

The principles and standards of organizational behavior set down by the UN Global Compact cover more issues than the OECD Guidelines for Multinational Enterprises.
False

The European Economic Community is an example of a regional trade bloc.
True

Which of the following is recommended by the OECD?
Companies should contribute to the innovative capacities of host countries.

There is no perfect model for a code of ethics.
True