ch9 Flashcards
In the “bad apple–bad barrel” analogy, the bad barrel refers to which of the following?
An unethical corporate culture
Which of the following statements about codes of conduct are not true?
a. They show employees that the business is both responsible and ethical.
b. They address every ethical issue that an employee may face.
c. They help communicate expectations for employees.
d. They provide rules and guidelines for employees to follow.
e. They give the company culture an ethical foundation.
b. They address every ethical issue that an employee may face.
A strong ethics program includes which of the following elements? (Select four) a. A clause promising good stock market performance
b. A written code of conduct or ethics
c. Formal ethics training
d. Auditing, monitoring, enforcement, and revision of standards
e. High-level personnel to oversee the program
B c d e
In the absence of ethics programs, employees are likely to make decisions based on which of the following?
a. Their observations of how their coworkers and superiors behave
b. How they and their family members behave at home c. Whatever they can get away with
d. Their educational backgrounds
e. What they did at their previous organizations
a. Their observations of how their coworkers and superiors behave
Formal statements that describe what an organization expects of its employees in terms of ethical behavior are known as _______.
codes of conduct
Because a corporation can be considered a moral agent, it is therefore _______.
responsible to society for its actions
Which type of orientation strives to develop shared standards?
Values
For an ethics and compliance program to properly function, which of the following is true?
a. Consistent enforcement and disciplinary action are essential.
b. Employees must be monitored using any means necessary.
c. It is not necessary to set measurable program objectives.
d. The same program should be used in all countries of operation, regardless of cultural differences.
e. The company must wait until after misconduct occurs to develop a means of preventing it.
Consistent enforcement and disciplinary action are essential.
Which of the following is the most comprehensive?
Code of ethics
At the heart of the Federal Sentencing Guidelines for Organizations is a(n) _______.
carrot-and-stick philosophy that rewards efforts to improve ethics
Which of the following pieces of legislation has increased the responsibilities on ethics officers and boards of directors
to monitor financial reporting?
Sarbanes-Oxley Act
Because of social isolation that creates insensitivity and a lower level of motivation to regulate ethical decision
making, which of the following may be more inclined to engage in unethical organizational conduct?
High-status officials
Because their jobs and personal identity are often intimately connected to quarterly returns, top managers tend to focus on which of the following?
Financial performance
Which of the following is one responsibility of an ethics officer?
Monitoring and auditing ethical conduct
Which of the following is one of the key goals of successful ethics training programs?
To identify key risk areas employees will face
Which of the following is a major problem organizations tend to have when implementing an organizational ethics
program?
a. They fail to adopt formal corporate codes of ethics.
b. Government requirements for ethics programs are too ambiguous.
c. Wall Street investors demand companies take illegal action to increase profits.
d. Financial problems make ethical conduct impossible to pursue.
e. Top managers don’t integrate codes, values, and standards into their firms’ corporate cultures.
e. Top managers don’t integrate codes, values, and standards into their firms’ corporate cultures.
Which of the following is an advantage of a values-based ethics program over a compliance-based one?
a. Employees learn to make decisions based on values such as fairness, compassion, respect, and transparency.
b. Diverse employees no longer have differing values.
c. It requires employees to identify with and commit to specific required conduct.
d. A values orientation uses legal terms, statutes, and contracts that teach employees the rules and penalties for
noncompliance.
e. Unlike values-based programs, compliance-based programs cannot prevent misconduct.
a. Employees learn to make decisions based on values such as fairness, compassion, respect, and transparency.
Which of the following is a common mistake made when implementing an ethics program?
a. Setting specific program objectives
b. Developing materials that are not understandable by the average employee
c. Adapting a firm’s ethics program to its international operations
d. Allowing lower-level employees to make ethical decisions
e. Having one person take responsibility for implementing the ethics program
b. Developing materials that are not understandable by the average employee
Hotline 100 is a company that offers ethics hotline maintenance for organizations. The company accepts anonymous
calls 24/7, 365 days a year. Which component of the Federal Sentencing Guidelines for Organizations compliance
program does a company like Hotline 100 help organizations to satisfy?
Systems for monitoring, auditing, and reporting misconduct
Which of the following statements about ethics training NOT true?
a. Ethics training can educate employees about the firm’s policies and expectations, as well as about relevant
laws and regulations and general social standards.
b. Ethics training can dictate personal ethics on the job so employees no longer have differences in beliefs.
c. Ethics training can make employees aware of available resources, support systems, and designated personnel
who can assist them with ethical and legal advice.
d. Ethics training can empower employees to ask tough questions and make ethical decisions.
e. Ethics training can affect the influence of organizational culture, coworkers and superiors, and opportunity.
b. Ethics training can dictate personal ethics on the job so employees no longer have differences in beliefs.
Which of the following generates an ethical program that creates order by requiring that employees identify with and
commit to specific required conduct using legal terms and statutes?
Compliance orientation
Which of the following NOT key goals of successful ethics training programs?
a. Identify key risk areas employees will face.
b. Align employee conduct with organizational reputation and branding.
c. Provide a hierarchy of leadership for employees to contact when they are faced with an ethical dilemma they
do not know how to resolve.
d. Allow employees to solve ethical issues using their best judgment.
e. Allow a mechanism for employees to voice their concerns that is anonymous but provides answers to key
questions.
d. Allow employees to solve ethical issues using their best judgment.
Which individual is generally responsible for implementing disciplinary action for violation of a firm’s ethics
standards?
Ethics officer
To ensure that an ethics program addresses the needs of the average employee, it should include which of the
following? (Select four)
a. Feedback from employees across the firm
b. A question-and-answer section
c. Additional resources for guidance
d. Lengthy legal documents
e. User-friendly checklists, illustrations, and cartoons
a b c e
Which of the following 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?
Hotlines
Which of the following is one of the main reasons employees do not report observed misconduct?
Fear of retaliation
Because top managers may be more insensitive to ethical issues due to their focus on financial performance, the FSGO
guidelines suggest that ethics officers instead report to which of the following?
Board of directors
Which document serves the general public and also addresses distinct groups such as stakeholders?
Statement of values
The only way to develop an ethical corporate culture is to provide character education to existing employees or hire
employees with good character and sensitize them to ethical issues.
a. True
b. False
False
In many cases, a coherent ethical corporate culture does not evolve through independent individual and interpersonal
relationships.
a. True
b. False
True
The FSGO encourages federal judges to reduce or eliminate fines for firms with extensive compliance programs that
make due diligence attempts to abide by ethical and legal standards.
a. True
b. False
True
Companies should model their ethics training and communication initiatives after those of their competitors’.
a. True
b. False
False
The most effective hotlines operate on an anonymous basis and are supported 24 hours a day, 365 days a year.
a. True
b. False
True
One common problem found with corporate codes of ethics is that the codes were written too legalistically.
a. True
b. False
True
An ethics audit should be conducted regularly.
a. True
b. False
True
Which of the following is important in defining the scope of the audit process?
Available opportunities the business has to manage ethics
During which step of the ethics auditing process does an organization identify the tools or methods for measuring
progress in improving employees’ ethical decisions and conduct?
Collect and analyze relevant information
During which step of the auditing process should a firm examine all documents that make explicit commitments to
ethical, legal, or social responsibility?
Review the firm’s mission, goals, values, and policies
Ideally, which of the following should oversee an ethics audit?
The board’s financial audit committee
What is the first step in the auditing process?
Secure the commitment of top executives and directors
An independent assessment of the quality, accuracy, and completeness of a company’s social or ethics report is known
as _______.
verification
Which of the following is the final step in the ethics-auditing process?
Report the findings
Which of the following statements about ethics audits NOT true?
a. They provide an opportunity to measure conformity to the firm’s desired ethical standards.
b. They are a mandatory component of an ethics program.
c. They provide an objective method for demonstrating a company’s commitment to improving strategic
planning, including its compliance with legal and ethical standards and social responsibility.
d. They are a major component of the ethics program.
e. They are systematic evaluations of an organization’s ethics program and performance to determine whether it
is effective.
b. They are a mandatory component of an ethics program.
Which of the following is a tool that companies can employ to identify and measure their ethical commitment to
stakeholders?
Ethics audit
Because ethics audits are voluntary, there are fewer standards a company can apply with regard to reporting
frequency, disclosure requirements, and remedial actions that it should take in response to results.
a. True
b. False
True
A performance management tool that details a company’s performance through financial and nonfinancial
perspectives, giving management a comprehensive view of the business, is called _______.
the balanced scorecard
Which of the following provides international guidelines for compliance management?
ISO 19600
The measuring of social, financial, and environmental factors (or people, places, and planet) that recognizes business
has a responsibility to positively influence a variety of stakeholders, including customers, employees, shareholders,
community, and the natural environment is defined as the _______.
triple bottom line
Which of the following NOT responsibilities of an ethics officer?
a. Assessing the needs and risks an organization-wide ethics program must address
b. Developing and distributing a code of conduct or ethics
c. Reviewing and updating the code of conduct or ethics
d. Conducting training programs for employees
e. Operating the ethics hotline
e. Operating the ethics hotline
