Exam 3: The Managers Changing Work Environment and Ethical Responsibilities: Doing the Right Thing

A large factory across the street from Anne's Café, a family-owned restaurant for over 50 years, is planning to close. The employees of the plant are a large percentage of the customers for the café. The café's customers and suppliers are concerned about the future of the restaurant because they are external stakeholders.

A Ponzi scheme is when an individual or company utilizes the bait-and-switch method. A product is advertised at a low price, but when customers ask to buy the item they are told that the advertised good is not available and are pressured to buy a higher-priced item.

Joseph, a small café owner, is facing possible bankruptcy due to a severe decrease in business in his restaurant. Tom, a friend of Joseph, approached him about hiring illegal immigrants because Joseph can pay those workers a lower pay rate and save on payroll. What should Joseph do?

Phillip said to a dear friend, "I am fed up with my company's continual disregard for human life and the environment. They just continue to secretly dispose of hazardous chemicals into a nearby stream. I don't know how they get away with it! I am going to tell somebody today." Phillip's decision to tell somebody about his company's actions is an example of a(n) ______.

The employees of Mom's Pizza, a local pizza restaurant, feel that the owners and managers really try to follow the ethical policies outlined in their company's code of ethics. Pete, a cook, said that "Just today, Joe, our manager, called our supplier to let them know we received an extra case of tomatoes that we did not pay for. And they do this type of thing almost every day." Mom's Pizza maintains a(n) _____.

The Sarbanes-Oxley Act set up the Federal Trade Commission to ensure consumer protection and eliminate and prevent anticompetitive business practices, with penalties of as much as 25 years in prison for noncompliance.

Contrast the "holier-than-thou" effect and motivated blindness. Explain the dynamics behind cheating.

Corporate social responsibility is the belief that corporations are expected to go above and beyond following the law and making a profit to be a good corporate citizen and benefit interests of society.

After the scandals at WorldCom, Tyco, and Enron, in which company employees lost millions of dollars and their nest eggs, there was less concern for corporate governance and more interest in the development of corporate social responsibility.

Ethical behavior is behavior that is accepted as "right" as opposed to "accepted" according to the standards of what is right or wrong.

A whistle-blower is usually a stakeholder who reports organizational misconduct to the public.

Alonzo, the president of the student class and honor society, has been very busy and did not study for the history test. Although Alonzo is very confident, he realizes that he probably will not do well on the exam and has talked himself into cheating because he feels it is worth it to maintain his strong GPA, which he will need to be accepted by a good college. He tells his friend, "I don't usually do this, but I really have to do it." The cause of Alonzo's behavior is ____.

The board of directors of a corporation is responsible to see that the company is being run according to the employees' interests.

Summarize stakeholders. Describe the three internal stakeholders.

With a sole proprietorship, the board of directors is a vital part of major company decisions.

Contrast the viewpoints for and against social responsibility.

An organization's internal stakeholders consist of ___.

The marketing director informed his employees that he feels the company needs to improve its relationship with the distributors of the company's products to increase market share because they are part of the ______ environment of the company.

The mass media is considered part of an organization's _____.

Corporate governance is the system ____.