Exam 4: Demanding Ethical and Socially Responsible Behavior

Zach spent several months developing a good relationship with a business client.The client is now buying a significant amount of product from Zach's company,resulting in high commissions for Zach,personally.After checking the sales records for the past six months,Ben (a sales colleague of Zach's)started visiting the same client in the hopes of capturing some of the client's business too.Although he considers it "legal and fair game",sales reps in his firm have begun to avoid him because they consider it a violation of:

Studies show that consumers are not concerned about the socially conscious behavior of the firms with which they do business.

Obeying the law is ________ ethical behavior.

Enrollment at Tradewinds College (a well-known private institution)has increased by about 3% each year for three years,even though tuition and fees have gone up to help defray the cost of new wind turbines installed on campus to generate enough power to serve the campus buildings and to sell to local business establishments.As a recent student of contemporary corporate social responsibility,you conclude:

When stating a firm position on various social and political issues,corporate policies often commit company profits to back these positions.

Ethical problems and issues of social responsibility are:

Ethical behavior requires more than following the law.

A firm's net social contribution is a company report that measures the difference between its positive social contributions and its negative social impact.

One good reason for managing a business ethically is to help reduce employee turnover.

An ethic of justice is based on a sense of responsibility to reduce actual harm or suffering.

Corporate ________ covers issues such as setting minority hiring practices,manufacturing safe products,and minimizing pollution.

Employers should proceed cautiously when designing an employee incentive program that rewards employees strictly on increased sales.

Bernie Madoff's Ponzi scheme swindled about $65 million from customers who invested with his firm.Enron and WorldCom participated in inappropriate accounting methods.According to the Making Ethical Decisions box,"Cost of Corruption":

In order to avoid insider trading,the SEC (Securities and Exchange Commission)has adopted a new rule called _____________ that requires publicly traded companies to release information to everyone in a timely manner,rather than just to a few persons.

Fresh Walls Paint Company promotes its products as nontoxic and made from natural,organic substances that are safe for all persons including those with asthma and other lung conditions.In order to live up to customer expectations,it must walk the walk and not just talk the talk! If consumers learn that Fresh Walls' paints do not meet their expectations,their reaction is likely to tarnish the company's image.

When it comes to ethics and social responsibility,the public's perception of a firm is as important as what the firm does.

An ethic of care is based on principles like justice,fairness,equality,or authority.

As a show of corporate responsibility to your customers,your firm may elect to provide more information regarding your product than the law demands.

The objective of the Inter-American Convention Against Corruption document formulated and signed by the Organization of American States is to identify common global ethics.

Customers learn to trust companies that consistently demonstrate good behavior.Those same companies can lose this position with one,socially irresponsible activity.