ch 1 Flashcards
refer to person’s personal philosophies about what is right or wrong
morals
comprises organizational principles, values, and norms that may originate from individuals, organizational statements, or from legal system that primarily guide individuals and group behavior in business
business ethics
are specific and pervasive boundaries for behavior that should not be violated
principles
are enduring beliefs and ideals that are socially enforced
values
four basic consumer rights: the right to safety, the right to be informed, the right to choose, and the right to be heard
consumers’ Bill of Right
an organization’s obligation to maximize its positive impact on stakeholders and minimize its negative impact
corporate social responsibility
was developed to guide corporate support for ethical conduct
defense industry initiative on business ethics and conduct
a series of rules set by the U.S. Sentencing Commission
federal sentencing guidelines for organizations
is a United States federal law that mandates certain practices in financial record keeping and reporting for corporations
Sarbanes-Oxley act
An Act to promote the financial stability of the United States by improving accountability and transparency in the financial system
Dodd-Frank wall street reform and consumer protection act
is acceptable behavior as defined by the company and industry
ethical culture
is the component of corporate culture that captures the values and norms an organization defines
Ethical culture
Corporate social responsibility is defined as
An organization’s obligation to maximize its positive effects and minimize its negative effects on stakeholders
After the accounting scandals of the early 2000s, was/were enacted to restore confidence in financial reporting and business ethics
Sarbanes-Oxley Act
Which of the following is one of the rights spelled out by John F. Kennedy in his “Consumers’ Bill of Rights”?
a. The right to consumerism
b. The right to safety
c. The right to be protected
d. The right to be ethical
e. The right to be heard
The right to safety
During the 1990s, the institutionalization of business ethics was largely driven by which piece of legislation?
Federal Sentencing Guidelines for Organizations
A framework for evaluation of firm performance in the areas of environmental, social, and governance
Environmental Social Governance (ESG)
The 1960s saw a rise of consumerism. What is consumerism?
Activities undertaken by independent individuals, groups, and organizations to protect their rights as consumers
Ethically charged decisions _______.
a. are made at all levels of work and management
b. are made primarily by top management
c. stem from individual moral philosophies
d. are less important than other decision-making processes
e. are an isolated personal issue
a. are made at all levels of work and management
was developed in the 1980s to guide corporate support for ethical conduct by establishing a method for discussing best practices?
Defense Industry Initiative on Business Ethics and Conduct
Firms taking action to prevent and detect business misconduct in cooperation with government regulation are incentivized to do so by the rewards that are the focus of
Federal Sentencing Guidelines for Organizations
Which of the following statements about morals is true?
a. Morals are the same as principles and ethics.
b. Morals relate to the business’s ethical culture.
c. Morals are emphasized in business ethics programs.
d. Morals relate to you and you alone.
e. Morals do not have much influence over individual ethical decision making.
d. Morals relate to you and you alone.
Which of the following statements about values is true?
a. Values are specific and pervasive boundaries for behavior that should not be violated.
b. Values are acceptable behavior as defined by the company and industry.
c. Values are attempts by businesses to minimize their negative impact on society.
d. Values are a person’s moral philosophies about what is right or wrong.
e. Values are enduring beliefs and ideals that are socially enforced.
e. Values are enduring beliefs and ideals that are socially enforced.
As more than a compliance program, what is business ethics becoming?
An integral part of management’s efforts to achieve competitive advantage
Employees who view their organizational culture as ethical are more likely to
make personal sacrifices for the organization
President Obama’s administration focused on which of these major ethical issues?
Healthcare and consumer protection
Which of the following statements about business ethics is true?
a. A firm that has ethical management will succeed financially.
b. Codes of ethics should cover every business ethics issue.
c. Business ethics focuses more on laws than on values.
d. Individuals apply the same ethical rules in business as they do at home.
e. Conflict or trade-offs do not exist between profits and business ethics.
Conflict or trade-offs do not exist between profits and business ethics.
A far-reaching change to organizational control and accounting systems, making securities fraud a criminal offense, was accomplished by
Sarbanes-Oxley Act
The Foreign Corrupt Practices Act outlawed
Bribery of a foreign public official
The Sarbanes-Oxley Act resulted in which of the following?
a. It stiffened penalties for personal fraud.
b. It created an accounting oversight board that requires corporations to establish codes of ethics for financial reporting.
c. It required stakeholders to approve corporate firms’ financial statements.
d. It outlawed bribery of officials in other countries.
e. It made securities fraud a civil offense.
b. It created an accounting oversight board that requires corporations to establish codes of ethics for financial
reporting.
To survive and contribute to society, which of the following is true?
a. Businesses must operate at a loss.
b. Businesses must bribe foreign officials with facilitation payments.
c. Businesses must ignore the needs and desires of stakeholders.
d. Businesses must make a trade-off between profits and business ethics.
e. Businesses must earn a profit.
e. Businesses must earn a profit.
Because of Sarbanes-Oxley, what must publicly traded companies develop in order to assist in maintaining transparency in financial reporting?
Codes of ethics
When building long-term relationships between businesses and consumers, which of the following is essential for success?
a. Profit
b. Governance
c. Trust
d. Knowledge
e. A code of ethics
c. Trust
Which of the following statements about the Dodd-Frank Wall Street Reform and Consumer Protection Act is true?
a. It was very popular among Wall Street bankers.
b. It represented modest reform to the finance industry.
c. It came out of theological discussions in the 1920s.
d. It was designed to make the financial services industry more responsible.
e. It made it mandatory for public corporations to hire ethics officers.
d. It was designed to make the financial services industry more responsible.
In the Reagan/Bush eras, the major focus of the business world was on which of the following?
a. Self-regulation rather than regulation by government
b. Decreasing the number of mergers
c. Decreasing the multinational presence in the U.S. marketplace
d. Increasing government influence on the economic arena
e. Improving business ethics
a. Self-regulation rather than regulation by government
The six principles of the Defense Industry Initiative on Business Ethics and Conduct became the foundation for
The Federal Sentencing Guidelines for Organizations
Ethical culture is defined as which of the following?
a. Ethical culture refers to rules, standards, and moral principles regarding what is right or wrong in specific situations.
b. Ethical culture is the establishment and enforcement of ethical codes throughout an organization.
c. Ethical culture involves the development of rules and norms that are socially enforced.
d. Ethical culture refers to the codification of laws to reward organizations for taking action to prevent misconduct.
e. Ethical culture is acceptable behavior as defined by the company and industry.
e. Ethical culture is acceptable behavior as defined by the company and industry.
The Federal Sentencing Guidelines for Organizations set the tone for organizational ethics compliance programs through
a. By codifying into law incentives for organizations to take action such as developing ethical compliance
programs to prevent misconduct
b. By forcing all organizations to develop mandatory reporting systems and ethics programs
c. By eliminating most of the federal legislation that created inefficient and time-consuming activities for businesses
d. By providing detailed guidelines for how to set up organizational ethics programs to guard against unethical conduct
e. By providing a thorough examination of company codes of ethics to determine whether they are sufficient
a. By codifying into law incentives for organizations to take action such as developing ethical compliance programs to prevent misconduct
The Federal Sentencing Guidelines for Organizations are described by which of the following statements?
a. They use a routine mechanical approach that forces all firms to use the same means to avert serious penalties.
b. They strive to prosecute misconduct.
c. They encourage companies to develop standards and procedures for penalizing misconduct.
d. They utilize a carrot-and-stick approach by taking preventive action against misconduct.
e. They encourage self-regulation as opposed to oversight of compliance.
d. They utilize a carrot-and-stick approach by taking preventive action against misconduct.
Employees’ perceptions of their firm as having an ethical climate lead to
Performance-enhancing outcomes
A global compliance management standard that addresses risks, legal requirements, and stakeholder needs is known as
ISO 19600
Investors are concerned about business ethics because they know that misconduct can
lower stock prices
When an organization has a strong ethical environment, it usually focuses on the core value of placing whose interests first?
Customers’
Why is the public more tolerant of consumer misconduct than business misconduct?
a. Businesses are expected to have a better idea of right and wrong.
b. The decisions of individuals have little to do with ethics in the business world.
c. There are big differences in wealth and success between businesses and consumers.
d. More organizations commit misconduct than individual consumers.
e. There is a large income disparity among professional businesspeople.
c. There are big differences in wealth and success between businesses and consumers.
What happens when society deems a particular business action as wrong or unethical?
Legislation usually follows.
Which business ethics issue was a major concern during the 1920s?
Living wage
Prior to the 1960s, ethical issues related to business were often discussed in the domain of theology or philosophy.
a. True
b. False
True
ISO 19600 is a set of 10 principles concerning human rights, labor, the environment, and anti-corruption.
a. True
b. False
False
Every organization has the potential for unethical behavior, even if it is not a business.
a. True
b. False
True
Morals are enduring beliefs and ideals that are socially enforced.
a. True
b. False.
b. False.
The Consumers’ Bill of Rights developed by John F. Kennedy maintains that consumers have the right to safety, the
right to be heard, the right to free speech, and the right to choose.
a. True
b. False
False
A majority of consumers believe it is a company’s responsibility to have a moral or ethical viewpoint.
a. True
b. False
True
Specific and pervasive boundaries for behavior that should not be violated are known as
principles
Which of the following concepts refers to a person’s personal philosophy about what is right or wrong?
Morals
The term that comprises organizational principles, values, and norms that may originate from individuals, organizational statements, or from the legal system that primarily guides individual and group behavior in business is defined as _______.
business ethics
A situation where a person is faced with multiple choices, all of which are undesirable as defined by that person, is
known as a(n) _______.
moral dilemma
