Chapter 2 Flashcards
Corporate governance
the way in which an organization is governed, directed, and administered; requires balancing the interests of all stakeholders
Business integrity
the ability to act honestly, ethically, and in a socially responsible manner
Ethics
the study of right and wrong, and of the morality of the choices individuals make
Business ethics
the application of moral standards to business situations
Social responsibility audits
comprehensive reports of what an organization is doing in regard to social issues that affect it
Conflict of interest
occurs when a businessperson takes advantage of a situation for their own personal interests rather than for the employer’s interests
Transparency
the free flow of information inside and outside the company
Preconventional ethics
a stage in the ethical development of individuals in which people behave in a childlike manner and make ethical decisions in a calculating, self-centred, selfish way based on the possibility of immediate punishment or reward
Conventional ethics
the second stage in the ethical development of individuals in which people move from an egocentric viewpoint to consider the expectations of an organization or society
Postconventional ethics
the third stage in the ethical development of individuals in which people adhere to the ethical standards of a mature adult and are less concerned about how others view their behaviour than about how they will judge themselves in the long run
Code of ethics
a written guide to acceptable and ethical behaviour as defined by an organization
Whistle-blowers
an employee who exposes or reports unethical practices within the organization
Ethical dilemmas
decisions where every alternative impacts various stakeholders in unpleasant ways
Economic model of social responsibility
the view that society will benefit most when business is left alone to produce and market profitable products that society needs
Social responsibility
the recognition that business activities have an impact on society and the consideration of that impact in business decision making
Socioeconomic model of social responsibility
the concept that business should emphasize not only profits but also the impact of its decisions on society
Social investing
investors looking for opportunities that align with their beliefs and values
Stakeholder
anyone who is impacted by the activities of the business, including investors, employees, customers, suppliers, and the general public (i.e., government and society)
Strategic giving
a strategy to positively impact the company by giving with an expectation of a gain
Philanthropic initiatives are integrated into the company’s overall business strategy, rather than being treated as separate activities.
* This ensures that giving efforts are sustainable and contribute to the company’s long-term success.
Minority
a racial, religious, political, national, or other group regarded as different from the larger group of which it is a part and that is often singled out for unfavourable treatment
Employment equity
increased representation of minority groups in the workplace through provision of equal employment opportunities for all
Canadian Human Rights Commission (CHRC)
ensures federally regulated employers are fulfilling their legal obligation to provide equal employment opportunities to women, people with disabilities, Aboriginal peoples, and visible minorities
Caveat emptor
a Latin phrase meaning ‘let the buyer beware’
placing the responsibility on the buyer to perform due diligence before making a purchase.
Recycling
converting used materials into reusable materials to prevent their unnecessary disposal
Sustainability
protecting the natural environment to ensure survival for present and future generations
Green marketing
the process of developing and promoting environmentally friendly products and services
Business ethics
Business ethics is the application of moral standards to business situations. Maintaining high ethical standards can be hard enough in everyday life, but it can get even more complicated in business.
What are three examples of competing fairly and honestly?
Negotiate in good faith
compare real benefits of product vs competitors
Inform about rate increases
Three examples of avoiding conflict of Interest
Build strong relationship with suppilers
Disclose any outside personal activities that could conflict with job
Use company expense budgets only for necessary expenses.
Three examples of being transparent
accurate earning reports to investors
Respond to reports on poor working conditions at a supplier
Disclose a dangerous product defect and recall the product
What are the 3 factors that affect ethics?
Individual factors
Social factors (the law)
Opportunity
what are the three parties that encourage ethical behaviour?
Gov
trade associations (preventing extravagant gifts)
organizations
What does the Auditor General of Canada do?
Ensures management’s information is reliable and complete
Identifies opportunities for improving control and use of poblic resources
Makes recommendations to improve systems and practices
What are the three factors that affect ethics
Individual factors (knowlage or personal goals)
Social factors (THE LAW, cultural norms)
Opportunity (competitive environment, supervision, and enforcement)
What are the three main Organizations that help promote ethical behavior.
Government, Trade organizations, and organizations
How can the government encourage ethics?
Legislating more stringent regulations
How can trade Associations encourage Ethics?
Puts pressure on companies (ex prohibits gifts to members form other organizations)
What is the role of organizations in encouraging ethics?
Code of ethics
Protect whistle-blowers
what is the difference between a customer and a consumer
customer buys
consumer uses
(purchasing [customer] a textbook for your child [consumer])
what are the four basic consumer rights
the right to…
be informed
be heard (someone will listen and take action for a complaint)
safety (product safe for intended use)
and to choose
[chis]
What are the three strategies for sustainability?
Product improvements
Facilty and behicle improvements
community outreach
What is the triangle of ethics
Perceive pressure
Perceived opportunity
Way to rationalize the unethical decision
