Ethics Test 2 - Flashcards

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The Foreign Corrupt Practices Act outlawed

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Bribery of officials in other countries

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Which of the following is not one of the benefits of being ethical and socially responsible in business?

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A high degree of employee dissent

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Ethical culture is defined as

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Acceptable behavior as defined by the company and industry

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Which of the following is not cited as an example of a global collaborative effort to establish standards of business conduct?

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United States Sentencing Commission

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Which of the following was not a provision of the Sarbanes Oxley Act?

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It outlawed bribery of officials in other countries?

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One of the major ethical issues President Obama's administration focused on was

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Health care and consumer protection

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Most organizations with strong ethical climates usually focus on the core value of placing ______ interests first

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Customers'

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Employees feel less pressure to compromise ethically, observe less misconduct, are more satisfied with their organizations, and feel more valued when

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They see honesty, respect, and trust applied in the workplace

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When unethical acts are discovered in a firm, in most instances

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there was knowing cooperation or complicity from within the company

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In corporate governance, ____ is the process of auditing and improving organizational decisions and actions

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control

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Stakeholders' power over businesses stems from their

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ability to withdraw or withhold resources

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Why do critics argue that high compensation for boards of directors is a bad thing?

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It could cause conflicts of interest between the directors and the organization

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Minimizing the use of energy and reducing emissions and waste are issues of importance to which stakeholder?

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Environmental groups

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One policy to address the issue of executive pay was implemented by J,P. morgan. It Stated that....

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Managers should earn no more than twenty times the pay of other employees

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____ are used to obtain or retain business and are not generally considered illegal in the U.S.

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Facilitation payments

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Optimization is defined as

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a trade-of between equity and efficiency

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Ethical issues in business typically arise because of conflicts between individuals' personal moral philosophies and values and the

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values and attitudes of the organization in which they work and the society in which they live

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The _____ makes it illegal for individuals, firms, or third parties doing business in American markets to "make payments to foreign government officials to assist in obtaining or retaining business"

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U.S. Foreign Corrupt Practices Act (FCPA)

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____ is an important element of virtue and means being whole, sound, and in unimpaired condition

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Integrity

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Prior to the financial meltdown, bond ratings agencies were accused of having ______________ because they were paid by the organizations that they rated. The organizations would shop around for the agency that gave them the best rating.

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Conflicts of interest

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Conflicts of interest exist when employees must choose whether to

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advance their own personal interests, those of the organization, or those of some other group

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Companies that _____ will most likely be found in violation of procompetitive legislation

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establish monopolies

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Which of the following groups is not a group that receives special legal protections?

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The highly educated

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Laws and regulations change over time; however, in the United States the thrust of most business legislation can be summed up as

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Any practice is permitted that does not substantially reduce competition and harm consumers or society

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The _____ regulates tobacco, dietary supplements, vaccines, veterinary drugs, medical devices, cosmetics, products that give off radiation, and biological products.

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The Food and Drug Administration

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Passed by Congress in 1991, the ____ created incentives for organizations to develop and implement ethical compliance programs.

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Federal Sentencing Guidelines for Organizations

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Anticompetitive strategies that focus on weakening or destroying a competitor have spurred antitrust legislation and include all of the following except

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Free samples

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Which of the following acts can be classified as procompetitive legislation?

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Sherman Antitrust Act of 1890

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The Sarbanes-Oxley Act created the _____ to oversee the accounting firms that audit public corporations and to establish rules and standards for auditing

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Public Company Accounting Oversight Board

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The _____ can be defined as a set of values, norms, and artifacts, including ways of solving problems shared by members of an organization.

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Corporate culture

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An ethical corporate culture needs _____ along with _____ to establish an ethics program and monitor the complex ethical decisions being made by employees

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shared values, proper oversight

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For people who begin the value shift that leads to unethical decisions, which of the following is not a usual justification to reduce and eliminate guilt?

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This is in keeping with my personal morals and the code of conduct, so it is okay

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Values have all of the following characteristics except ____

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widely accepted

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Which of the following is not an issue that helps in business ethics evaluations and decisions?

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Personal guilt

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_____ culture involves values and norms that prescribe a wide range of behavior for organizational members, while ______ culture reflects the integrity of decisions made and is a function of many factors, including corporate policies, top management's leadership on ethical issues, the influence of coworkers, and the opportunity for unethical behavior.

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Corporate, ethical

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______ is the ability to perceive whether a situation or decision has an ethical dimension.

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ethical awareness

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According to the ethical decision-making framework, the absence of punishment provides a(n) _____ for unethical behavior.

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opportunity

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Codes, rules, and compliance are essential in organizations. However, an organization built on _____ is more likely to develop a high integrity corporate culture.

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informal relationships

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An individual who believes that an action is ethical because others within his or her company and industry regularly engage in the activity is probably a(n)

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Relativist

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Both individual ethics and organizational ethics have an impact on an employee's

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Ethical intention

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Over the years, scholars have developed more than 100 definitions of culture. According to the text, all have the following common elements:

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Culture is shared, relatively stable, and is formed over a long period of time

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_____ bring together the functional expertise of employees from several different areas of the organization on a single project.

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Teams

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The 2010 passage of the Dodd-Frank Act proposed additional monetary incentives for whistle-blowers. A primary concern about these new incentives is

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Whistle blowers might be tempted to report to the SEC with their reports and not report the misconduct to the company's internal compliance program

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When developing an ethical culture, there has to be a(n) _____ element because every organization has employees that will try to take advantage if there is an opportunity for misconduct

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Compliance

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In order for whistle-blowing to be effective

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it requires that the individual have adequate knowledge of wrongdoing that could damage society.

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Expert power usually stems from

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A superior's credibility with his or her subordinates

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Although both structures can create opportunities for unethical conduct, which organizational structure tends to be more ethical?

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Centralized

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Associating with others who are unethical and who have the opportunity to act unethically can lead to a learning process known as

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differential association

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Individuals, often from the same department, who band together for purposes that may or may not be relevant to the organization are called

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Informal groups

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The _____ leader demands instantaneous obedience and focuses on punishing wrong behavior, achievement, initiative, and self-control.

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coercive

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Which of the following cultures combines high levels of concern for people and performance?

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Integrative culture

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An organization that delegates decision-making authority as far down the chain of command as possible and has relatively few formal rules is

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Decentralized

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Which of the following statements about corporate culture is false?

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The values and ethical beliefs that actually guide the firm's employees tend not to be the same ones that management states as defining the firm's culture.

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Which of the following statements about group norms is false?

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Group norms never conflict with the overall organization's culture.

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The apathetic organizational culture exhibits

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minimal concern for people and performance

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The Sarbanes-Oxley Act

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has institutionalized internal whistle-blowing

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The ultimate "stick" associated with the FSGO is fines or probation, which involves on-site observation by consultants, monitoring of the company's ethical compliance efforts, and

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reporting to the U.S. Sentencing Commission on the company's progress in avoiding misconduct.

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Which of the following statements about training is false?

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It can dictate personal ethics on the job

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Which of the following is the most comprehensive?

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Code of ethics

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serve as a central contact point where critical comments, dilemmas, and advice can be assigned to the person most appropriate for handling a specific case.

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Hotlines

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Which of the following is not an advantage of having a comprehensive code of conduct?

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To help employees fight for satisfactory levels of compensation and benefits

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Organizational _____ can contribute to diminished employee trust and increased employee turnover.

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Misconduct

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In the long run, a(n) ______ orientation may be better for companies, perhaps because it increases employees' awareness of ethics issues at work.

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Values

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_____ are formal statements that describe what an organization expects of its employees in terms of ethical behavior.

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Codes of conduct

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A(n) _____ orientation creates order by requiring that employees identify with and commit to specific required conduct, whereas a(n) _____ orientation strives to develop shared standards.

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Compliance, values

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With regard to ethics, training and communication initiatives should reflect

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The unique characteristics of an organization

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Because top managers may be more insensitive to ethical issues due to their focus on financial performance, the FSGO guidelines suggest that ethics officers report to the _____ instead.

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Board of directors

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Aurico is a company that offers ethics hotline maintenance and monitoring services for organizations. Which component of the Federal Sentencing Guidelines for Organizations compliance program does this service help organizations to satisfy?

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Systems for monitoring, auditing, and reporting misduct

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Most executives feel that which of the following is the primary reason for much of the unchecked misconduct in business?

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Inadequate ethics and compliance programs

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

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Sarbanes-Oxley Act

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Which of the following strives to create order by requiring that employees identify with and commit to specific required conduct?

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Compliance orientation

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The individual responsible for implementing disciplinary action for violation of a firm's ethics standards is usually the

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Ethics officer

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Which of the following statements about ethics audits is false?

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Social audits and ethics audits perform basically the same function, so organizations can use them intergangeable

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While social reports often discuss issues related to a firm's performance in the four dimensions of social responsibility, as well as to specific social responsibility and ethical issues, ethics audits have a narrower focus on assessing and reporting on a firm's performance in terms of

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Ethical and legal conduct

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During which of the following steps of the ethics auditing process does an organization identify the tools or methods for measuring progress in improving employees' ethical decisions and conduct?

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Collect and analyze relevant information

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The process of verifying the results of an audit should involve standard procedures that control the _____ of the information.

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Reliability and validity

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Which of the following is not a technique for collecting evidence during the ethics audit?

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Publishing the results of an audit

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The word _____ implies a balanced organization that makes ethical financial decisions and also is ethical in more subjective matters of corporate culture.

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Integrity

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What should be the final step in the ethics auditing process?

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Report the findings

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During which step of the auditing process should a firm examine all documents that make explicit commitments to ethical, legal, or social responsibility?

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Review organizational mission, goals, values, and policies

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Which of the following does not have a significant impact on the success of an ethics program?

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The size of the company

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Which of the following is a possible unintended consequence of an organization's focusing more on ethics planning than on implementation?

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Unethical conduct is viewed as acceptable behavior

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During the data-collection phase of the audit, the primary objective is to generate a variety of opinions about how the company is perceived and whether it is

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Fulfilling stakeholders' expectations

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At which stage of the ethics auditing process would a hospital conduct focus groups with management, doctors, nurses, related health professionals, support staff, and patients?

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Collect and analyze relevant information

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The concept of ethics auditing emerged from the movement to audit and report on companies' broader _____ initiatives.

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Social responsibility

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While ideally the board of directors financial audit committee conducts ethics audits, in most firms they are conducted by

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Managers or ethics officers

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What should be the first step in the auditing process?

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Secure the commitment of top executives and directors

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What are the three Triple Bottom Line factors incorporated into the Global Reporting Initiative framework?

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Economic, social, and environmental indicators

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What is a major role of the International Monetary Fund (IMF)?

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It makes short-term loans to member countries that have deficits and provides foreign currencies for its members

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_ involves transactions across national boundaries. It is a practice that brings together people who have different cultures, values, laws, and ethical standards.

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Global business

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Which of the following is not a key area of global ethical risk, as outlined by the Eurasia Group?

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Unequal levels of child labor laws

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These values were developed by a reverend and the UN Secretary General. They express support for universal human rights.

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The Global Sullivan Principles

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Increasing the wealth gap between nations and misusing and misallocating scarce resources are ethical issue accusations related to

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Multinational corporations

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What is the purpose of the UN Global Compact?

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To promote human rights, sustainability, and eradicate corruption

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Who argued during the 1930s that the state could stimulate economic growth and improve stability in the private sector?

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John Maynard Keynes

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Which of the following is not a criticism of or charge against multinational corporations (MNCs)?

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They pay excessively high taxes everywhere

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Which of the following organizations emerged from the Bretton Woods agreement of 1944, where a group of international leaders decided that the primary responsibility for the regulation of monetary relationships among national economies should rest in an extra-national body?

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International Monetary Fund

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An unconscious reference to one's own cultural values, experiences, and knowledge is referred to as the

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Self-reference criterion

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Which two developing countries are expected to generate some of the largest increases in consumption in the future?

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China and India

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The _____ formed in 1995 and administers its own trade agreements, facilitates future trade negotiations, settles trade disputes, and monitors the trade policies of member nations

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World Trade Organization

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What is the AACSB?

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An international organization that promotes a set of principles promoting the teaching of responsible management in business schools

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Which of the following is a measure taken by governments to curtail MNC practices that create ethical issues?

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Imposing export taxes to force MNCs to share more of their profits

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The practice of charging high prices for products sold in home markets while selling the same products in foreign markets at low prices, which do not cover the costs of exporting, is known as

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Dumping

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When in Rome, do as the Romans do, or you must adapt to the cultural practices of the country in which you are operating are rationalizations businesspeople sometimes offer for straying from their own ethical values when doing business abroad. This practice is called

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Cultural relativism

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_____ assume(s) that a market, through its own inherent mechanisms, will keep commerce in equilibrium.

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Laissez-faire economics

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_____ is a term used by Adam Smith to explain the inherent mechanisms at work in free market systems that keep commerce in equilibrium. It is also known as the "invisible hand."

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Laissez-faire

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Leaders having a _____ conflict management style are highly assertive and not very cooperative

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Competing

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When a group is more likely to move toward a more extreme position than the group members might have done individually, this is referred to as

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Group polarization

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This occurs when there are two or more positions on an ethical decision.

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Ethical conflict

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Which of the following types of leaders attempts to create employee satisfaction through bartering or negotiating for desired behaviors or level of performance?

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Transactional leaders

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The acronym RADAR stands for

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Recognize, Avoid, Detect, Answer, and Recover

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Gossip, manipulation, playing favorites, and taking credit for another's work are all examples commonly associated with

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Organizational politics

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Leaders with a(n) ________ conflict management style desire to meet the needs of stakeholders and strongly adhere to organizational values and principles.

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Avoiding

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Which leadership type values people, their emotions, and their needs and relies on friendship and trust to promote flexibility, innovation, and risk taking?

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Affiliative leadership

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All of these are true about feedback except

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Most companies recognize the need for organizational leaders to get feedback from their empoyees

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This occurs when leaders and followers share the same vision, ethical expectations, and objectives for the company

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Leader-follower congruence

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The Clean Air Act

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Established national air quality standards

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Stakeholder assessment is an important part of a ______ approach to environmental issues

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High-commitment

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Limiting urban sprawl creates disadvantages for

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Car and oil companies

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All of these are examples of social responsibility concerns except

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product price

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Through _________________ , it is possible to quantify the trade-offs to determine whether to accept or reject environmentally-related activities and programs.

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Risk-management

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The first Earth Day, increasing stakeholder awareness of environmental concerns and the creation of the Environmental Protection Agency brought ______________ to the forefront.

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Sustainability

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The Clean Water Act makes it illegal for anyone to discharge any pollutant from a point source directly into navigable waters without a .

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Permit

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Which includes the assessment and improvement of business strategies, economic sectors, work practices, technologies, and lifestyle while maintaining the natural environment?

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Sustainability

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Organizations highly committed to environmental responsibility may conduct an audit of their efforts and report the results to all interested ___________.

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Stakeholders

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Critics of nuclear power are concerned about all of the following except

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Reduced emissions

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Wind power holds great promise for the United States because of the _____________, and experts believe wind energy could meet as much as 20 percent of the nation's energy needs.

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Rocky Mountains

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In the United States, ______ provides only 7% of total output but provides 19% of total electricity production worldwide, making it the largest form of renewable energy

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Hydroelectric power

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Many businesses responded to sustainability by adopting a triple-bottom line approach, taking into consideration social and environmental performance variables in addition to

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Economic performance

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A _________________ business attempts to avoid dealing with environmental issues and hopes nothing bad happens or no one ever finds out about an environmental accident or abuse.

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low-commitment

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The _____ focuses on reducing pollution through cost-effective changes in production, operation, and raw materials use

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Pollution Prevention Act

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The Kyoto Protocol created in 1997 is an international treaty meant to curb global

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greenhouse gas emissions

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Geothermal energy provides ____ and is a more dependable energy source than some other forms of alternative energy

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A constant source of heat

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Associating with others who are unethical and who have the opportunity to act unethically can lead to a learning process known as...

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Differential association

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The ______ leader demands instantaneous obedience and focuses on punishing wrong behavior, achievement, initiative, and self-control.

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Coercive

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The rule explains variation in employee conduct through generalizing on the percentage of employees in any given organization who will seek to do right versus how many will be indifferent.

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10-40-40-10

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Sarbanes-Oxley 404 Compliance Section

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The characteristics of an ethical corporate culture are codified within this section.

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Job performance =

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Ability x Motivation

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Main objective of FSGO:

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To encourage companies to asses risk and then self-monitor and aggressively work to deter unethical acts and punish unethical employees

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Corporate Code of Ethics often contain these six core values

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Trustworthiness, Respect, Responsibility, Fairness, Caring, Citizenship

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In the absence of ethics programs, employees are likely to make decisions based on

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Their observations of how their coworkers and superiors behave

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_____ are formal statements that describe what an organization expects of its employees in terms of ethical behavior.

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Codes of Conduct

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Which of the following is the most comprehensive?

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Code of Ethics

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The Federal Sentencing Guidelines for Organizations require federal judges to increase fines for organizations that continually

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Tolerate misconduct

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____ may be more inclined to engage in unethical organizational conduct because of social isolation that creates insensitivity and a lower level of motivation to regulate ethical decision making.

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Top Managers

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A code of ethics that does not address specific high-risk activities within the scope of daily activities is

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Inadequate

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Organizations can become "bad barrels" not because of unethical individuals but because

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The pressure to succeed creates opportunity to reward unethical decisions

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Six Sigma

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is a methodology designed to manage process variations that cause defects, defined as unacceptable deviations from the mean or target, and to systematically work toward managing variation to eliminate those defects. The objective of Six Sigma is to deliver world-class performance, reliability, and value to the end customer

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Balance Scorecard

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is a management system that focuses on all the elements that contribute to organizational performance and success, including financial, customer, market, and internal processes

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Triple Bottom Line

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Perspective that takes into account the social, environmental, and financial impacts of decisions made within an organization.

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Global Reporting Initiative

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The GRI advances sustainability reporting, which incorporates the triple bottom line factors of economic, social, and environmental indicators. The primary goal of the GRI is "the mainstreaming of disclosure on environmental, social, and governance performance."

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AccountAbility AA1000 Framework

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link the definition and embedding of an organization's values to the development of performance targets and to the assessment and communication of organizational performance

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Open Compliance Ethics Group

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nonfinancial compliance and the more qualitative elements of internal controls. The OCEG framework deals with complex issues of compliance and solutions to address the development of organizational ethics.

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Limiting urban sprawl creates disadvantages for

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Car and oil companies

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Limiting urban sprawl creates disadvantages for

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Car and oil companies

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