Chapter 7

Question 1

Corporate social responsibility (CSR)

Answer 1

is defined as the duty of a company’s management to work in the best interests of the society it relies on for its resources (human, material, and environmental), to advance the welfare of society, and to act as a good global citizen through its policies.

Question 2

Stakeholders

Answer 2

re individuals or groups affected by the organization that have a stake in its success and profitability.

Question 3

Business ethics

Answer 3

refers to a set of rules or guidelines that management or individuals follow to make decisions for their company.

Question 4

ethical dilemma.

Answer 4

Companies face ethical dilemmas related to paying bribes, using child labour, and corporate corruption.

Question 5

ethical imperialism.

Answer 5

certain universal truths or values are standard across all cultures.

Question 6

cultural relativism.

Answer 6

According to this perspective, the values of different cultures should be respected, as the ethics of one culture are not seen as better than those of another.

Question 7

Resource depletion

Answer 7

is the consumption of scarce or non-renewable resources.

Question 8

Corporate corruption

Answer 8

refers to involvement in illegal activities to further one’s business interests.

Question 9

Dumping

Answer 9

means selling products in a foreign country below the cost of production or below the price in the home country.

Question 10

predatory dumping.

Answer 10

A company may also lower the price of the product in the foreign country to increase sales and force its competition out of business in the host country. In this case, the exporter will then raise the prices.

Question 11

Subsidizing

Answer 11

occurs when the importing of a good is helped through financial assistance from the foreign government.

Question 12

Microcredit

Answer 12

is the granting of very small loans—often as little as $100—to spur entrepreneurship.

Question 13

non-governmental organizations (NGOs)

Answer 13

are non-profit organizations that are made up of paid professional staff and unpaid volunteers, and have a service and development focus.

Question 14

Ethics

Answer 14

A code of moral principles used to set standards of “good” and “bad”

Question 15

Ethical Behavior:

Answer 15

What is accepted as good and right according to the governing moral code.

Question 16

Terminal Values

Answer 16

Core moral beliefs.

Question 17

Instrumental Values

Answer 17

Values that lead to positive outcomes for an individual.

Example: ambition, courage, persistence

Question 18

Utilitarian view

Answer 18

greatest good to the greatest number of people.

results

Question 19

Individualism view

Answer 19

primary commitment is to one’s long-term self-interests.

Question 20

Moral-rights

Answer 20

respects and protects the fundamental rights of all people.

Question 21

Justice view

Answer 21

fair and impartial treatment of people according to legal rules and standards.

Question 22

How to Check Ethical Dilemas

Answer 22

Is it Legal? - will you be violating any criminal, civil laws or company policies by engaging in this activity?

Is it balanced? - is it fair to all parties concerned both short term and longer term? Is this a win win situation for those directly or indirectly involved?

Is it right? When push comes to shove how does this decision make you feel about yourself? Are you proud of yourself? How would you feel if this was printed in the newspaper? Will it stand the test of time?

Question 23

Social Responsibilty

Answer 23

Social responsibility is an ethical framework and suggests that an entity, be it an organization or individual, has an obligation to act for the benefit of society at large.Social responsibility is a duty every individual has to perform so as to maintain a balance between the economy and the ecosystems.

Question 24

Obstructionist Strategy

Answer 24

Obstructionist Strategy: managers choose not to be socially responsible.
Managers behave illegally and unethically; they hide and cover up problems

Example: Enron

Question 25

Defensive Strategy

Answer 25

Defensive Strategies: managers stay within the law but make no attempt to exercise additional social responsibility. Managers put shareholder interest above all other stakeholders Managers say society should make laws if change is needed Managers often deny intentional wrongdoing Example: Tobacco companies Did not put health warnings on packages and did not drop T.V. ads until the government told them to Canadian and American tobacco companies continue to advertise in countries where bans do not exist

Question 26

Accommodating Strategy

Answer 26

Accommodated Strategies: managers realize the need for social responsibility. Managers try to balance the interest of all stakeholders. Example: Companies that will match employee contributions to charity or sponsor a local sports team

Question 27

Proactive Strategy

Answer 27

Proactive Strategies: managers actively embrace social responsibility. Managers go out of their way to learn about and help stakeholders Example: The Body Shop Coca-Cola also pledged $20 million for the World Wildlife Foundation to protect sections of major rivers in North America, Europe, Africa and Asia. The Body Shop creates all natural products, uses recycled material and devotes staff time to community projects. McDonald’s has worked with children’s hospitals to establish Ronald McDonald house.

Question 28

grease

Answer 28

bribing