Chapter 3

Question 1

Define ethics

Answer 1

Standards/moral values dictating right vs. Wrong; culturally based;formed based on society expectations; varies by person/situation

Question 2

Does everyone develop their own “ethics code”?

Answer 2

Yes

Question 3

What influences ethical behaviour?

Answer 3

Family + peer group + experiences

Question 4

Define managerial ethics

Answer 4

Standards of behaviour guiding managers

Question 5

What are behaviour types in the workplace

Answer 5

1. Towards employees 2. Towards org. 3. Towards other economic entities

Question 6

How is ethical behaviour assessed in the workplace?

Answer 6

1. Relevant, factual info gathered 2. facts analyzed to determine appropriate moral values 3. Ethical judgement made based on rightness or wrongness of proposed activity/policy

Question 7

Define utility

Answer 7

Act optimizing (or not) what is best for people affected by it

Question 8

Define a right

Answer 8

Respecting (or not) individuals involved

Question 9

Define justice

Answer 9

Consistent (or not) with fairness

Question 10

Define caring

Answer 10

Consistency (or not) with peoples’ responsibilities toward others

Question 11

What do written codes of ethics do for a workplace?

Answer 11

1. Increase public confidence in firm 2. Helps stem tide of govt regulation 3. Improve internal operations by providing consistent standards of ethical and legal conduct 4. Helps managers respond to problems as result from unethical or illegal behaviours

Question 12

How often do organizational objectives change?

Answer 12

Infrequently

Question 13

How often do the core principles of a company change?

Answer 13

Never

Question 14

How often are strategies or practises revised?

Answer 14

Frequently

Question 15

Define corporate social responsibility

Answer 15

Business should balance commitments to individuals/groups directly affected by activities

Question 16

Define fair-trade movement

Answer 16

Designed to help workers in developing countries receive fair pay

Question 17

What are the four areas of social responsibility?

Answer 17

Towards enviro., customers, employees, investors

Question 18

What responsibilities does a company have towards the enviro?

Answer 18

Air pollution, land pollution (toxic waste disposal, recycling), water pollution

Question 19

What responsibilities does a company have towards their customers?

Answer 19

Consumer rights (consumerism), unfair pricing (collusion), advertising ethics

Question 20

What are advertising ethics?

Answer 20

Truth in ads, ads of counterfeit, morally objectionable ads

Question 21

What are consumer rights? (6)

Answer 21

Right to: safe products, info of relevant aspects of product, be heard, choose what they buy, educated about purchase, courteous service

Question 22

What responsibilities does a company have towards their employees?

Answer 22

Legal, social commitments ; HR, social responsibility, privacy issues; drug testing; computer monitoring; encouraging ethical behaviour (whistle blowers)

Question 23

What responsibilities does a company have towards their investors?

Answer 23

Avoid improper financial management, kiting cheques, insider trading, misrepresentation of finances

Question 24

Define improper financial management

Answer 24

Company’s financial resources are poorly managed, legally unpunishable because no law is being broken

Question 25

Define cheque kiting

Answer 25

Illegal practice of writing cheques against $$ not yet in bank account ; creative cheque later can write from account to accountwith no money to back up; assumption that $ will arrive before cheque clears

Question 26

Define insider trading

Answer 26

Using confidential (non- public) info to gain from stock sale; can involve collision between investors buying vs. Selling at right time to make huge profit

Question 27

Define misrepresentation of finance

Answer 27

Companies not conforming to accounting guidlines and principles; not following GAAP to inflate expected profit figure and misleading investors

Question 28

What are the 4 levels (from lowest to highest) of social responsibility?

Answer 28

Obstructionist stance, defensive stance, accommodative stance, proactive stance

Question 29

What are examples of corporate charitable donations?

Answer 29

Companies contributing to programs (ex Ronald McDonald house); often donating goods after disasters; employees encouraged to volunteer

Question 30

What are the 4 steps to implementing a social responsibility program?

Answer 30

1. Top management support 2. Strategic planning 3. Appointing director 4. Social adult

Question 31

Define step 1 of implementing a social responsibility program

Answer 31

Top management support: developping policy statement outlining commitment to ethical behaviour

Question 32

Define step 2 of implementing a social responsibility program

Answer 32

Strategic planning: top managers develop plan of level of support; percent of sales revenue goes to social causes; promise to train chronically unemployed people

Question 33

Define step 3 of implementing a social responsibility program

Answer 33

Appointing director: Executive-level admin. appointed to oversee program; part-time commitment on part of existing top managers

Question 34

Define step 4 of implementing a social responsibility program

Answer 34

Social adult: Systematic analysis of how a firm uses funds; adresses effectiveness of money spent; triple bottom line reporting; sustainable development

Question 35

Define triple bottom line reporting

Answer 35

Financial reports, social audits, sustainability reports

Question 36

Define sustainable development

Answer 36

Activites meeting current needs not putting future gens. at disadvantages

Question 37

Are small businesses impacted by social responsibility like large businesses? Why/why not?

Answer 37

Yes, due to limited financial resources and concerns for economic survival; tempted to take cash deals (sometimes illegal, trying to justify) or avoid sustainable products because of higher costs