chapter 1-5 Flashcards
What is ethics?
Standards of moral behavior; behavior accepted by society as right versus wrong
Few Americans have moral absolutes, and common standards often derive from religion and concepts like the Golden Rule.
Why is obeying the law only the first step in behaving ethically?
Because ethical behavior also considers what is morally right, not just what is legally permissible.
What are the three questions to ask when faced with a potentially unethical action?
- Is my proposed action legal?*
- Is it balanced?*
- How will it make me feel about myself?
What is the role of management in setting ethical standards?
Managers instill corporate values in employees and create an environment of trust based on fairness, honesty, and integrity.
What are compliance-based ethics codes?
Codes that emphasize preventing unlawful behavior by increasing control and penalizing wrongdoers.
What are integrity-based ethics codes?
Codes that define the organization’s guiding values, support ethically sound behavior, and stress shared accountability.
List the six steps in setting up a corporate ethics code.
- Top management must adopt and support a corporate code of conduct.*
- Employees must understand management’s expectations for ethical behavior.*
- Managers must be trained to consider ethical implications.*
- An ethics office must be established for anonymous communication.*
- Involve outsiders in the ethics process.*
- The ethics code must be enforced with timely actions.
What is corporate social responsibility (CSR)?
A business’s concern for the welfare of society, based on a commitment to integrity, fairness, and respect.
What are the dimensions of a company’s social performance?
- Corporate philanthropy*
- Corporate social initiatives*
- Corporate responsibility*
- Corporate policy
What are President Kennedy’s four basic rights of consumers?
- The right to safety.*
- The right to be informed.*
- The right to choose.*
- The right to be heard.
What is insider trading?
An unethical activity where insiders use private company information for personal gain.
What is the purpose of social auditing?
To systematically evaluate an organization’s progress toward implementing socially responsible programs.
What are some of the five types of watchdogs involved in social auditing?
- Socially conscious investors*
- Socially conscious research organizations*
- Environmentalists*
- Union officials*
- Customers
What are some international standards for ethical behavior?
- Foreign Corrupt Practices Act*
- Inter-American Convention Against Corruption*
- UN condemnation of corporate bribery*
- ISO 26000
True or False: Top leaders are being held to lower standards of ethical behavior internationally.
False
Fill in the blank: A _______ is an insider who reports illegal or unethical behavior.
[whistleblower]
What can be the consequences for companies that fail to meet CSR expectations?
Negative impacts on customer perception and potential financial losses.
