SU9 - Micro Factors - Business Ethics Risk Management

Question 1

What is Business Ethics Risk?

Answer 1

It refers to the moral rules and regulations governing the business world.

Question 2

What is Ethical Risk?

Answer 2

It refers to the exposure to events, which may result in criminal prosecution, civil law suites or erosion of reputation.

Examples include bribery, false accounting, child labour, tax evasion, money laundering and invasion of privacy.

Question 3

A business ethics system can be composed of 7 sequential components. Name them.

Answer 3

1. Vision
2. Context
3. Establish
4. Implement
5. Monitor
6. Respond
7. Evaluate

Question 4

Explain the ‘vision’ within the Business Ethics System.

Answer 4

It is the starting point and consist of two components:

1. Core ideology - defines what the business stands for.
2. Envisioned future - what the business wish to become

Question 5

The context of the Business Ethics System consist of which components?

Answer 5

1. Legal
2. Economic
3. Political
4. Environmental
5. Social
6. Technological

Question 6

Explain ‘establish’ within the Business Ethics System.

Answer 6

The system developed must reflect its size, complexity, resources, context and culture.

Question 7

‘Establish’ within the Business Ethics System consist of 7 levels of responsibility. Name and explain them.

Answer 7

1. Responsible Officer - oversee the program
2. Ethics Officer - Coordinating functions of ethics program
3. Business Ethics Council - represents the business
4. Professional Ethics Council - advising officers and employees about ethics, compliance & social responsibility.
5. Business Ethics Officer - link business levels with central ethics office
6. CFO/HR/Legal council - performing executive & department functions.
7. Employees - abide by standards & procedures