Business Ethics Test 3

question

In developing an ethical culture, what element is essential because without it, employees will try to take advantage, if an opportunity for misconduct presents itself?
answer

A compliance element
question

What are some characterizations of a corporate culture?
answer

Innovation and Risk Taking Attention to Detail Outcome Orientation People Orientation Aggressiveness Team Orientation Stability
question

What are some informal expressions of a corporate culture?
answer

Statements, both direct and indirect. Shared values are expressed by instituting informal dress codes, working late, participating in extracurricular activities. Can be expressed through gestures, looks, labels, promotions, programs, and legends
question

What are group norms and what are the characteristics of group norms within an organization?
answer

Group norms are standards of behavior groups expect of their members. Characteristics: govern group rates of production and communication with management, provide a general understanding of behavior considered right or wrong, ethical or unethical.
question

Is it possible for management’s sense of the organization’s culture to be quite different from employees’ perceptions?
answer

Management’s sense of an organization’s culture may not be in line with the values and ethical beliefs that actually guide a firm’s employees.
question

How do organizations create motivation?
answer

To create motivation, an organization offers incentives that encourage employees to work toward organizational objectives.
question

In centralized organization structures what type of communication is an ethical concern?
answer

Upward communication
question

What types of retaliation might a whistle-blower experience?
answer

Labeled traitor or terminated, forced to retire
question

What common elements do all definitions of culture share?
answer

1. culture is shared among individuals belonging to a group or society 2. culture is formed over a relatively long period of time 3. culture is relatively stable
question

What type of organizational structure delegates decision-making authority as far down the chain of command as possible?
answer

Decentralized organization
question

What are the five characteristics of an ethical corporate culture?
answer

1. Management and the board demonstrate their commitment to strong controls 2. Every employee is encouraged and required to have hands-on involvement in compliance 3. Every employee is encouraged and empowered to report policy exceptions. 4. Employees are expected to be in the communication loop through resolutions and corrective actions. 5. Employees have the ability to report policy exceptions anonymously to any member of the organization.
question

What type of organizational structure tends to be more ethical?
answer

Centralized organizations tend to be more ethical
question

What are the five power bases from which one person may influence another and how would you describe each?
answer

1. reward power – influencing a person’s behavior by offering a reward 2. coercive power – opposite of reward power, behavior is penalized 3. Legitimate power – certain people have right to exert influence and others have an obligation to accept it 4. Expert power – derived from a person’s knowledge, superiors credibility with subordinates 5. referent power – one person perceives that his or her goal or objectives are similar to another’s
question

How would you describe an apathetic culture?
answer

An apathetic culture shows minimal concern for either people or performance. Individuals focus on their own self-interest.
question

How would you describe an exacting culture?
answer

An exacting culture shows little concern for people but a high concern for performance, organization focuses on its own interest.
question

What is a major concern of the proposed monetary incentives of the Dodd-Frank Act for whistle-blowers?
answer

One major concern is whistle blowers will go external with the information rather than internal. Whistle blowers might go straight to the SEC
question

What are formal groups?
answer

an assembly of individuals with an organized structure that is explicitly accepted by the group.
question

What are information groups?
answer

two or more individuals with a common interest but without an explicit organizational structure.
question

To be truly effective, what must a whistle-blower have?
answer

adequate knowledge of wrongdoing that could damage society.
question

How would you describe an integrative culture?
answer

combines a high concern for people and performance. Superiors recognize employees are more than interchangeable parts
question

How would you describe a caring culture?
answer

exhibits high concern for people but minimal concern for performance issues.
question

What has an impact on an employee’s ethical intention?
answer

Individual and organizational ethics
question

What does differential association refer to?
answer

the idea that people learn ethical or unethical behavior while interacting with others who are part of their role-sets or belong to other intimate personal groups. Associating with others who are unethical creates an opportunity for unethical behavior.
question

Does the Sarbanes-Oxley Act concern itself with internal whistle-blowing?
answer

SOX and FSGO institutionalized internal whistle-blowing to encourage discovery for organizational misconduct.
question

What is a cultural audit and how is it used?
answer

an assessment of an organization’s value. The audit is conducted by outside consultants but may be performed internally
question

Who is responsible for implementing disciplinary action for violation of a firm’s ethical standards?
answer

The ethics officer is usually responsible for implementing all disciplinary actions for violations of the firm’s ethical standards.
question

Which ethics program (compliance vs. Values) increases employees’ awareness of ethics at work?
answer

Value based programs
question

To avoid designing an ethics program that does not address needs of the average employee, what should a company do to make program materials more user-friendly?
answer

To avoid this problem, ethics programs-including codes of conduct and training materials-should include feed back from employees from across the firm, not just the legal department.
question

What does a strong ethics program include?
answer

Written codes of conduct Ethics officers to oversee the program Careful delegation of authority Formal ethics training Rigorous auditing, monitoring, enforcement, and revision of program standards
question

What are common mistakes when designing and implementing an ethics program?
answer

Failure to understand and appreciate goals Setting unrealistic/immeasurable objectives Unsupportive top management Ineffective or incomprehensible content Transferring an “‘American” program to a firm’s international operations Designing a program that is little more than a series of lectures resulting in low recall
question

How comprehensive are codes of conduct, a code of ethics and statement of values?
answer

1. Code of Ethics is most comprehensive; consists of general statements serving as principles and the basis for the rules in a code of conduct 2. Statement of values – Serves the general public and addresses stakeholder interests 3. Code of Conduct – is a formal statement with the organizations expectations of its employees
question

What type of philosophy is at the heart of the Federal Sentencing Guidelines for Organizations (FSGO)?
answer

Carrot-and-stick philosophy
question

What do top managers tend to focus on?
answer

Top managers tend to focus on financial performance because of their jobs and personal identities are often intimately connected to their firms’ quarterly returns.
question

What are some of the resources used to monitor ethical conduct and measure the program’s effectiveness?
answer

Effective programs employ various methods to measure effectiveness Observing employees Internal audits and investigations Surveys Reporting systems External audits
question

What leads to diminished employee trust and increased employee turnover?
answer

misconduct
question

What are some of the key characteristics of a code of ethics?
answer

code of conduct code of ethics statement of values ethics officer formal ethics training systems of monitoring, auditing, and enforcement ethics audit social audit
question

In the absence of an organizational ethics program, employees are likely to make decisions based on what?
answer

their own observations of how their coworkers and superiors behave.
question

What is a code of conduct?
answer

formal statements that describe what an organization expects of its employees.
question

What is the difference between a compliance orientation and a values orientation?
answer

compliance orientation creates order by requiring employees identify with and commit to specific require conduct. Values orientation strives to develop shared values, the focus is more on an abstract core of ideals such as accountability and commitment.
question

For an ethical compliance program to properly function, what is essential?
answer

consistent enforcement and disciplinary action are essential
question

According to the FSGO, Federal Judges are encouraged/required to increase fines on organizations that ______ and to reduce/eliminate fines for firms with extensive compliance programs that are making ______.
answer

1. continually tolerate misconduct 2. due diligence attempts to abide by legal and ethical standards.
question

Which legislation has increased the responsibilities on ethics officers and boards of directors to monitor financial reporting?
answer

Sarbanes-Oxley and the amendments to the FSGO
question

According to a fraud survey, most executives believe that ____ is the primary reason for much of the unchecked misconduct in business.
answer

inadequate ethics and compliance programs
question

What are some advantages of a values-based ethics program?
answer

Value based programs increase employees’ awareness of ethics at work, integrity, willingness to deliver information to supervisors, use of reporting mechanisms, and perception that ethical decisions are being made.
question

What are the key goals of successful ethics training programs?
answer

1. Identify key risk areas employees will face. 2. Provide experience in dealing with hypothetical or disguised ethical issues within the industry through mini-cases, online challenges, DVDs, or other experiential learning opportunities. 3. Let employees know wrongdoing will never be supported in the organization and employee evaluations will take their conduct in this area into consideration. 4. Let employees know they are individually accountable for their behavior. 5. Align employee conduct with organizational reputation and branding. 6. Provide ongoing feedback to employees about how they are handling ethical issues. 7. Allow a mechanism for employees to voice their concerns that is anonymous, but provides answers to key questions (24-hour hotlines). 8. Provide a hierarchy of leadership for employees to contact when they are faced with an ethical dilemma they do not know how to resolve.
question

According to the FSGO guidelines, ethics officers should report to whom and why?
answer

ethics officers should report to the board of directors rather than the general counsel. Because top managers may be more vulnerable to pressures placed on them to push employees to engage in unethical activities and thereby become more competitive.
question

Why are organizational ethics programs needed?
answer

to promote legal and ethical conduct. Without ethics programs, it is difficult for employees to determine what behaviors are acceptable within a company.
question

What are keys to successful ethics training?
answer

1. educate employees about the firm’s policies and expectations, relevant laws and regulations, and general social standards. 2. make employees aware of available resources, support systems and designated personnel who can assist them with ethical and legal advice. 3. empower employees to ask tough questions and make ethical decisions 4. make employees aware of ethical issues 5. increase the importance of ethics training to employees 6. increase employees’ confidence they can make the correct decision when faced with an ethical dilemma.
question

What are the benefits of having an ethics code?
answer

1. Guide employees in situations where the ethical course of action is not immediately obvious. 2. Help the company reinforce—and acquaint new employees with—its culture and values. A code can help create a climate of integrity and excellence. 3. Help the company communicate its expectations for its staff to suppliers, vendors, and customers. 4. Minimize subjective and inconsistent management standards. 5. Help a company remain in compliance with complex government regulations. 6. Build public trust and enhance business reputations. 7. Offer protection in preempting or defending against lawsuits. 8. Enhance morale, employee pride, loyalty, and the recruitment of outstanding employees. 9. Promote constructive social change by raising awareness of the community’s needs and encouraging employees and other stakeholders to help. 10.Promote market efficiency, especially in areas where laws are weak or inefficient, by rewarding the best and most ethical producers of goods and services.
question

What are ethics officers responsible for?
answer

Ethics officers are responsible for managing the ethics and legal compliance programs 1. assessing the needs and risks an organizations-wide ethics programs must address 2. developing and distributing a code of conduct or ethics 3. conducting training programs for employees 4. establishing and maintaining a confidential service to answer employees’ questions about ethical issues 5. making sure the company is in compliance with government regs. 6. monitoring and auditing ethical conduct 7. taking action on possible violations of the company’s code 8. reviewing and updating the code

Get instant access to
all materials

Become a Member