Chapter 2

Question 1

Corporate social responsibility

Answer 1

actions that appear to further some social good, beyond the
interests of the firm and that which required by law.

Question 2

International social responsibility

Answer 2

includes the expectation that MNCs should be concerned with
the social and economic effects of their decisions

Question 3

Benefits of CSR

Answer 3

improved employed recruitment, motivation, and retention; increase in brand
value, revenue increases, cost decreases, risk reduction, improve reputation, improved
customer attraction & retention, secured license to operate, improved access to capital

Question 4

Anti-Sweatshop Code of Conduct

Answer 4

requires companies to provide a healthy and safe work
environment and to pay the prevailing local minimum wage

Question 5

Moral universalism

Answer 5

the need for a moral standard that is accepted by all cultures

Question 6

Ethics

Answer 6

moral principles and values that govern the behavior of people, firms, and governments,
regarding right and wrong

Question 7

Ethnocentric approach

Answer 7

a company applies the morality used in its home country. Public pressure
in the home country often forces the MNC to act in accordance with ethnocentric value systems

Question 8

Ethical relativism

Answer 8

implementing the morality of host country

Question 9

Foreign Corrupt Practices Act (FCPA) of 1977

Answer 9

primarility establish to distinguish between
harmless customs and actual bribery. Allows “grease” payments if those payments are lawful in
the country. Prohibits US companies from making illegal payments, gifts, or political
contributions to foreign government officials for the purposes of influencing them in business
transactions. Some US firms complain they are at a disadvantage due to FCPA

Question 10

Creating Shared Value (CSV)

Answer 10

creating social value creates economic value. Reconceiving
products and markets, reducing the environmental footprint and investing in jobs, facilities and
physical presence are examples of creating shared value

Question 11

Electronic Industry Code of Conduct (EICC)

Answer 11

Contract manufacturers should follow some basic
environmental requirements.

Question 12

SA8000

Answer 12

Provides a safe work environment. It’s the world’s leading social certification program.
Provides a framework for organizations to conduct business in a way that is fair and decent for
workers and to demonstrate their adherence to the higher social standards. (child labor, forced
labor, healthy and safety, discrimination, disciplinary practices, working hours, remuneration,
management system, right to collective bargaining)

Question 13

Transparency International

Answer 13

NGO that fights corruption and measures the relative prevalence of
bribery in various spheres of people’s lives

Question 14

EU Directive on Data Protection

Answer 14

dedicated to monitoring issues of data privacy in Europe

Question 15

Grease money

Answer 15

payments to expedite routine transactions. Also called tokens of appreciation.
These payments are questionable in terms of ethics

Question 16

Organization for Economic Cooperation and Development Convention on Bribery

Answer 16

to combat
corporate corruption

Question 17

Code of ethics

Answer 17

are company guidelines for the actions and decision-making by all employees in
the firm.

Question 18

Steps for making ethical decisions

Answer 18

1. Consulting the laws of both the host and home countries.
2. Consult the International Codes of Conduct for MNEs. 3. Following your own conscience and
   moral code

Question 19

Sustainability

Answer 19

meeting humanity’s needs without harming the ability of future generations to
meet their needs. Sustainable practices could result in cost savings for more efficient
production

Question 20

International codes of conduct

Answer 20

the MNE behavior toward the host government is related to
economic and developmental policies, laws and regulation, and political involvement. MNEs
should conduct research and development activities in developing countries. MNE behavior
toward to public is related to technology transfer and environmental protection. MNE behavior
toward persons should focus on human rights, employment practices and consumer protection

Question 21

International business ethics

Answer 21

refers to the business conduct or morals of MNCs in their
relationship with individuals and entities

Question 22

Nationalism

Answer 22

the practice by a country of rallying public opinion in favor of national goals and
against foreign influences

Question 23

Governmentalism

Answer 23

the government uses its policy-setting role to favor the interests of the
nation

Question 24

Export of hazardous wastes

Answer 24

from developed countries to less developed countries has increased
significantly due to weak regulations and low costs

Question 25

Global interdependence

Answer 25

the profitability of individual companies depends on cooperative and
constructive attitudes

Question 26

Triple bottom line

Answer 26

3 dimensions of sustainability-economic, social, environmental

Question 27

Global compliance system

Answer 27

shows that employees have understood, and signed off on, the legal
obligations regarding bribery ad corruption in the countries where they do business