Ch16

Question 1

Name the three ethical tests to help identify and explain ethical issues?

Answer 1

1) Transparency - Does the company mind other people knowing about the decision?
2) Effect - Who does the decision hurt?
3) Fairness - Would the decision be considered fair ?

Question 2

What are the 3 main types of sustainability issues to consider?

Answer 2

1) Social - Negative impact on society (e.g. low paid workers, diversity, etc)
2) Environmental - pollution, etc
3) Economic

Question 3

What is corporate responsibility?

Answer 3

Corporate responsibility is the belief that the firm owes a responsibility to society and stakeholders

Question 4

Why bother with corporate responsibility? (3)

Answer 4

1) PR
2) Self-regulation is cheaper than imposed regulation
3) Attracts ethical investors