Chapter 5 - Ethics and Social Responsibility

Question 1

Ethics

Answer 1

standards of moral behaviour

behaviour that is accepted by society as right versus wrong

Question 2

Legality

Answer 2

more limited

refers only to laws written to protect people from fraud,theft, and violence

Question 3

3 questions to answer when faced with a potentially unethical action

Answer 3

1) is it legal
2)is it balanced
3)how will it make me feel
companies use these 3 questions to have a better chance than most of behaving ethically

Question 4

Managers role in setting ethical standards

Answer 4

• the messages they send through their actions

- managers tolerance or intolerance of ethical misconduct influences employees more than written ethics codes do

Question 5

compliance based ethics code

Answer 5

concerned with avoiding legal punishment

Question 6

integrity based ethics code

Answer 6

• define the organizations guiding values
• create an environment that supports ethically sound behaviour
• stress shared accountability among employees

Question 7

Six steps that improve business ethics

Answer 7

1) top management must adopt and support an explicit corporate code of conduct
2) employees must understand that expectations for ethical behaviours begin at the top and that senior management expects all employees to act accordingly
3) managers and others must be trained to consider the ethical implications of all business decisions
4) an ethics office must be set up, and phone lines to the office should be established
5) outsiders such as suppliers, subcontractors, distributors, and customers must be top about the ethics program
6) the ethics code must be enforced

Question 8

Which step is most critical in the 6 step process?

Answer 8

the last step (ethics code must be enforced) is the most critical because a company’s ethics policy must be enforced to be taken seriously

Question 9

Corporate social responsibility

Answer 9

is the concern businesses have towards stakeholders

Question 10

Business is responsible to have 5 types of stakeholders

Answer 10

1) it must satisfy customers with goods and services of real value
2) it must make money for its investors
3) it must create jobs for employees, maintain job security and see that hard work and talent are fairly rewarded
4) must create new wealth for society and promote social justice
5) must contribute to making its environment a better place

Question 11

Company’s social responsibility efforts measured

Answer 11

• measures an organizations progress toward social responsibility
• some people believe that a audit should ad together the organizations positive actions and then subtract the negative effects to get a net social benefit