Deck 5: Ethics, Corporate Responsibility, and Sustainability

Question 1

Phil Colley, a project manager, finds an envelope in his office mailbox. The return address indicates that it was sent by a salesman for HiTek Instruments, a long-time supplier to Phil's firm. Inside the envelope is a "thanks for the business" note and $2,000 in cash. Afraid that he will be perceived as receiving a "kickback," Phil immediately takes the envelope and cash to his manager to report what he found. Phil uses ________ as an ethical system in his decision making.

A)ecocentric management
B)egoism
C)utilitarianism
D)relativism
E)conventionalism

Answer 1

B

Question 2

________ is the ethical system stating that the greatest good for the greatest number should be the overriding concern of decision makers.

A)Universalism
B)Utilitarianism
C)Relativism
D)Egoism
E)Pragmatism

Answer 2

B

Question 3

Clara is meeting with Tilly, her subordinate, to prepare Tilly for her first performance appraisal. Clara informs Tilly that her performance will be based upon her results, her behavior, and her ________. Tilly asks, "What do you mean by ________?" Clara replies, "Your principles of conduct, including fairness, loyalty, and honesty."

A)competency
B)courage
C)experience
D)values
E)work ethic

Answer 3

D

Question 4

According to egoism, a major ethical system,

A)individual self-interest is the actual motive of all conscious action.
B)all people should uphold certain values that society needs to function.
C)ethical behavior is based on the opinions and behaviors of relevant other people.
D)the greatest good for the greatest number should be the overriding concern of decision makers.
E)the welfare of the underprivileged should be the overriding concern of decision makers.

Question 5

Meredith believes that ethical behavior is anything that provides the maximum benefit for herself. What ethical system does Meredith subscribe to?

A)universalism
B)utilitarianism
C)relativism
D)egoism
E)pragmatism

Question 6

When Rabia must decide whether something is right or wrong, she considers the writings of the ancient teachers Confucius and Marcus Aurelius, whose works she has read many times. These books form the basis of Rabia's

A)moral philosophy.
B)value system.
C)ethical situation.
D)relativism.
E)egoism.

Question 7

According to virtue ethics, moral individuals can transcend society's rules by applying personal virtues.

Question 8

Individuals can be ethical leaders if they have a strong moral character, regardless of which issues attract their attention.

Question 9

Integrity-based ethics programs are primarily concerned with the avoidance of illegality.

Question 10

Business ethics are

A)the principles of conduct, such as caring, being honest, pursuing excellence, and showing loyalty.
B)the moral principles and standards that guide behavior in the world of business.
C)the system of rules that governs the ordering of economic value.
D)a situation, problem, or opportunity in which a political leader must choose among several actions.
E)the principles, rules, and values that people use in deciding what is right or wrong for themselves.

Question 11

________ often suffer the most when corporations behave unethically.

A)Top executives
B)Consumers
C)Rank-and-file employees
D)Corporation lawyers
E)Board of directors

Question 12

People in the preconventional stage of Kohlberg's model of cognitive moral development base their decisions on

A)expectations held by groups or institutions.
B)self-chosen ethical principles.
C)laws and regulations.
D)rewards and punishment.
E)religious or philosophical teachings.

Question 13

According to relativism, a major ethical system,

A)individual self-interest is the actual motive of all conscious action.
B)the greatest good for the greatest number should be the overriding concern of decision makers.
C)ethical behavior is defined based on the opinions and behaviors of associated people.
D)all people should uphold certain values that society needs to function.
E)the welfare of the underprivileged should be the overriding concern of decision makers.

Question 14

Once a year at the annual employee meeting, the president of Northwest Bank, Inc. reminds his employees of his belief that there are certain values everyone can agree on, such as honesty, fairness, and respect for life. Which ethical system does the president believe in?

A)universalism
B)utilitarianism
C)relativism
D)egoism
E)pragmatism

Question 15

________ is moral philosophy.

A)A system of rules that governs the ordering of values
B)A system of ethical ideas that depends on kyosei and human dignity
C)A system that promotes the greatest good for the greatest number
D)Principles, rules, and values people use in deciding what is right or wrong
E)Principles needed to prevent, detect, and punish legal violations

Question 16

The ethical system known as egoism is similar to Adam Smith's concept of the invisible hand in business.

Question 17

Kristian believes that everyone should uphold honesty, justice, and kindness so that society can function at its best. ________ is the ethical system that best fits Kristian's beliefs.

A)Relativism
B)Egoism
C)Universalism
D)Ethnocentrism
E)Utilitarianism

Question 18

Profit maximization and corporate social responsibility necessarily lead to opposing corporate policies.

Question 19

________ is the system of rules that governs the ordering of values.

A)Ethnocentrism
B)Ethics
C)Dynamics
D)Legitimacy
E)Dialectics

Question 20

________ is the ethical system most likely to emphasize that there are different ethics in different cultures.

A)Universalism
B)Utilitarianism
C)Relativism
D)Egoism
E)Pragmatism

Question 21

A sales manager, Gunter, is facing an ethical situation; his bicycle company sold a mountain bike with a defective component. If he informs the customer and issues a recall, it would cost him a substantial amount of money. If the bike malfunctions, there is a very small chance that it could cause serious injury to a cyclist who might use it on rough terrain. He decides to use the egoism approach to decision making and remain silent about the defect, because he

A)is motivated by self-interest.
B)is looking to accomplish the greatest good for the greatest number of people.
C)wants to first consult with his insurer.
D)is motivated to protect the interests of his employees.
E)wants to first consult with others whom he respects.

Question 22

The management of an organization follows the ideology that if they work keeping in mind the company's own economic self-interest, the total wealth of the society will be maximized. ________ is the ethical system that is used by this organization.

A)Ethnocentrism
B)Relativism
C)Egoism
D)Universalism
E)Utilitarianism

Question 23

________ acknowledges the existence of different ethical viewpoints and uses norms as guidelines.

A)Virtue ethics
B)Relativism
C)Universalism
D)Utilitarianism
E)Egoism

Question 24

Carlos is a customer service representative who determines his work behavior solely on whether he thinks he can do actions without receiving immediate punishment from his boss. According to Kohlberg, Carlos' behavior exemplifies the ________ stage of moral development.

A)principled
B)conventional
C)righteous
D)preconventional
E)unconventional

Question 25

Akako works as a receptionist for a medical office. Some of the doctors have asked her to tell patients that they are in an appointment when in fact they are playing golf. If Akako wanted to follow the ethical system of universalism, she would

A)make sure the doctors do her a favor, such as giving her tickets to a concert, in return for lying for them.
B)ask around to see if other receptionists have done similar favors for doctors.
C)refuse to lie because she believes that the lie will be discovered, harming her reputation.
D)quit her job because she believes all people should uphold certain values, such as not lying.
E)decide to lie because everyone does it at one time or another.

Question 26

Utilitarianism is centered around the idea that

A)ethical ideas depend on kyosei and human dignity.
B)an ethical system should define acceptable behavior as that which maximizes consequences for the individual.
C)an ethical system with no rules will help bring out the best in people.
D)ethical behavior should be based on the opinions and behaviors of relevant other people.
E)the greatest good for the greatest number should be the overriding concern of decision makers.

Question 27

Stephanie's behavior is typically guided by what she thinks would be acceptable to her parents. According to Kohlberg, Stephanie's behavior exemplifies the ________ stage of moral development.

A)utilitarian
B)conventional
C)principled
D)preconventional
E)conclusive

Question 28

Louis received a holiday gift from one of his company's suppliers. He estimated the value of the gift at $20. He was not sure he could ethically accept the gift, so he reviewed company policy and discussed the matter with his manager. Then, using the relativism approach to decision making, Louis

A)made a decision based upon his individual self-interest.
B)weighed the ethical issues relative to financial issues.
C)was influenced by guidance from other resources and respected people.
D)weighed the ethical issues relative to practical issues.
E)weighed the ethical issues relative to internal "political" issues.

Question 29

________ has been identified as a factor that contributes to unethical behavior.

A)Having a written code of ethics
B)Believing that ethical problems have complex solutions
C)Emphasizing short-term revenues over long-term considerations
D)Balancing the demands of all stakeholders rather than giving shareholders priority
E)Having written-out procedures for handling ethical problems

Question 30

Alesha, owner of a small craft shop, sold decorative wall hangings that - unknown to her - contained hazardous lead-based paint. The paint was a very small part of the finished product, and the crafts were intended to hang well above the reach of small children and pets. Nonetheless, when Alesha learned that the crafts contained the hazardous paint, she contacted each buyer, took back the crafts she had sold them, and replaced the crafts with products that did not contain the hazardous paint. She acted as a mature businessperson with good moral character by using the ________ approach to ethical decision making.

A)egoism
B)utilitarianism
C)relativism
D)virtue ethics
E)universalism

Question 31

Stan has tremendous respect for his long-time manager and mentor, Neal. When Stan is confronted with a challenging ethical issue, he asks himself how Neal would handle the situation. Stan uses ________ as an ethical system to guide him in his decision making.

A)universalism
B)egoism
C)utilitarianism
D)relativism
E)conventionalism

Question 32

________ are the two ethical ideals of the Caux Principles.

A)Fairness and equality
B)Self-fulfillment and sharing
C)Unity and respect
D)Kyosei and human dignity
E)Honesty and kyosei

Question 33

Compliance-based ethics programs

A)are developed by moral thinkers.
B)promote moral excellence in an organization.
C)tolerate some illegal behavior.
D)emphasize personal responsibility for ethical behavior.
E)do not create a moral commitment to ethical conduct.

Question 34

Talia, store manager for Best Value Foods, learned that the store's commercial freezer failed overnight, and, for several hours, the frozen foods reached temperatures that were potentially unsafe. She decided to discard the food, at cost of many thousands of dollars, because she believed it was the right thing to do; the health of consumers was at stake. Talia used ________ as an ethical system to make her decision.

A)universalism
B)egoism
C)utilitarianism
D)relativism
E)conventionalism

Question 35

Charles reported that the industrial waste treatment system operated by his employer was no longer operating properly, allowing toxic waste to be discharged to the bay. He was pleased to see the plant manager, Lili, immediately shut down production for an indefinite period, pending repair of the waste treatment system. Lili demonstrated

A)excessive emphasis on short-term revenues.
B)responsiveness to shareholders at the expense of other constituencies.
C)a desire for simple and expedient solutions to ethical problems.
D)consideration of ethics solely as a legal issue or a public relations tool.
E)willingness to take an ethical stand that may impose financial costs.

Question 36

"That toxic discharge is endangering the public! We need to immediately stop production!" warned Manuel. His manager, Philip, said, "Manuel, we can't afford to solve that problem right now. Our profits are behind plan this quarter." An unwillingness to take an ethical stand that may impose financial costs is a sign that the company has a(n)________ that is conducive to unethical behavior.

A)distribution channel
B)ethical climate
C)legal responsibility
D)priority on managing Level 3 costs
E)corporate code

Question 37

A person who sees beyond authority, laws, and norms and follows his own self-chosen ethical principles is most likely to be in the ________ stage of Kohlberg's model of cognitive moral development.

A)utilitarian
B)conventional
C)principled
D)preconventional
E)intermediate

Question 38

The top executives of Diamond Investments have established processes to review the company's financial dealings and communications with customers to make sure everything is legal and honest yet remain focused on profits. These processes are part of the company's

A)corporate social responsibility.
B)ethical climate.
C)ecocentric management.
D)legal responsibility.
E)moral obligation.

Question 39

"To be compliant with the requirements of the Sarbanes-Oxley Act, I will need to ensure that our company ________," thought Hilmar Preiss, Chairman of the Board.

A)has a more independent board of directors
B)loosens up our accounting procedures
C)keeps two sets of books, one public and one private
D)managers do not sign off on financial results
E)executives earn large annual bonuses

Question 40

The Sarbanes-Oxley Act

A)passed in 1992.
B)requires strict adherence to accounting rules.
C)allows senior managers to refuse to sign off on financial results.
D)is intended to maintain truth in advertising.
E)requires whistleblowers to be fired.

Question 41

"Of course it is legal for us to accept cash gifts from our suppliers, as long as we don't get too greedy, and as long as we don't do anything illegal," said Max Robinett, CEO of TransVision Products. "That's why I have instructed our corporate legal staff to design mechanisms to prevent, detect, and punish legal violations." Max is promoting a(n)________ ethics program.

A)associate-based
B)compliance-based
C)integrity-based
D)systems-based
E)consensus-based

Question 42

Compliance-based ethics programs

A)are company mechanisms designed to instill in people a personal responsibility for ethical behavior.
B)are designed by corporate counsel to prevent, detect, and punish legal violations.
C)define ethical behaviors as those that maximize consequences for the individual.
D)define ethical systems by recognizing that the greatest good for the greatest number should be the overriding concern of decision makers.
E)are designed by the employees to define what ethical standards they should follow.

Question 43

According to John Rawls, only a person ignorant of his own identity can make a truly ethical decision. This thought process is based on

A)ethical shielding.
B)the veil of understanding.
C)the veil of ignorance.
D)ethical certainty.
E)ethical ignorance.

Question 44

Moral awareness involves

A)knowing which actions are required by law.
B)knowing which actions are morally defensible.
C)realizing that an issue has ethical implications.
D)having the strength to act in accordance with your ethics.
E)adopting the values of the most relevant moral leaders.

Question 45

A question associated with the "sunshine" ethical framework is

A)"How would your mother feel if she knew you had committed those actions?"
B)"How would you feel if your actions were highlighted in the media?"
C)"How would you feel if you were on the receiving end of those actions?"
D)"How would a lawyer evaluate the actions you are considering taking?"
E)"How would a moral philosopher evaluate the actions you are considering taking?"

Question 46

An ethics program that is designed by corporate counsel to detect, prevent, and punish legal violations is called a(n)________ ethics program.

A)life-cycle-based
B)compliance-based
C)integrity-based
D)sunshine-framework
E)responsibility-based

Question 47

"Sam, you don't have to ignore what you saw! You can call the corporate ethics hotline and report it," said Maria. She continued, "The hotline process offers a channel to ________, spur management to act quickly, and prevent retaliation against whistleblowers. I know that courage is needed when your only ethical course of action appears to be whistleblowing. But that's what you must do - work through channels to report wrongdoing."

A)ostracize whistleblowers
B)keep whistleblowers' identities secret
C)identify whistleblowers
D)keep ethics problems hidden
E)influence assignments given to whistleblowers.

Question 48

The process for ethical decision making begins with

A)defining the complete moral problem.
B)developing an ethical framework and determining the economic outcomes.
C)considering the legal requirements and evaluating the legal duties.
D)understanding all moral standards and recognizing all moral impacts.
E)proposing a convincing moral solution.

Question 49

Going beyond legal compliance with ADA standards and training people to understand that individuals with disabilities have valued abilities is an example of a(n)________ ethics program.

A)compliance-based
B)integrity-based
C)egoism-based
D)competency-based
E)utilitarianism-based

Question 50

Kyoshi Watanabe, Chairman of the Board of Global Products, said to the CEO, "Akio, we must cease production of those items; they are not healthy for our customers. We must transition to new, safe product lines. I know that our competitors are producing those unhealthy items, and I know that no laws prevent us or them from producing them. However, just because something is legal, does not mean that it is ethical. Kyoshi is promoting a(n)________ ethics program.

A)associate-based
B)compliance-based
C)integrity-based
D)systems-based
E)consensus-based

Question 51

________ plays a role in the moral awareness involved in identifying an act as unethical, the moral judgment to fully consider the repercussions, and the moral character to take the ethical action.

A)Courage
B)Legitimacy
C)Intelligence
D)Compliance
E)Knowledge

Question 52

Making ethical decisions takes moral ________, which helps a person realize that an issue has ethical implications.

A)certainty
B)actionability
C)awareness
D)judgment
E)character

Question 53

One way to construct an effective ethics code is to

A)keep it complex, formal, and rigid so that employees realize how serious it is.
B)make it as catchy and clever as possible.
C)involve only the legal department and top executives in writing the statement.
D)let the employees construct the ethics code according to their personal ideologies.
E)focus on relatable, real-life situations for employees.

Question 54

Integrity-based ethics programs involve

A)stated ethics, rules, and policies.
B)corporate social responsiveness.
C)a set of guiding principles.
D)monitoring and punishment.
E)discretionary social responsibility.

Question 55

________ is a danger sign that an organization may be allowing or even encouraging unethical behavior.

A)Excessive emphasis over long-term consideration over short-term revenues
B)Failure to establish a written code of ethics
C)An informal corporate structure
D)Flexible timings that allow employees to choose their hours of work
E)Multiple levels of supervision and monitoring

Question 56

"As a manager, you will often be challenged to make difficult ethical decisions," said Karen to her young protégé. "Making ethical decisions requires three attributes: 1)moral awareness-realizing the issue has ethical implications; 2)moral judgment-knowing what actions are morally defensible; and 3)moral ________-the strength and persistence to act in accordance with your ethics despite the challenges."

A)sustainability
B)intelligence
C)stewardship
D)character
E)thinking

Question 57

Katherine Lilly confidentially met with Jean Powers, Human Resources Director, to report Katherine's manager's fraudulent behavior. "I want to tell you the truth," Jean said,

A)"The road for whistleblowers is easy and painless."
B)"As a whistleblower, you will always be encouraged by our company to go public with your concerns."
C)"As a whistleblower, you will never suffer retaliation."
D)"Many whistleblowers suffer consequences such as being ostracized."
E)"The Sarbanes-Oxley Act prohibits whistleblowing."

Question 58

________ is most likely the last step in an ideal ethical decision-making process.

A)Defining the complete moral problem
B)Developing an ethical framework
C)Determining the legal requirements
D)Understanding all moral standards
E)Proposing a moral solution

Question 59

A whistleblower is a person who

A)tells others that wrongdoing has occurred.
B)encourages others to commit wrongdoing.
C)serves as legal counsel for an organization.
D)serves as the chief ethical officer of an organization.
E)signs off on the financial results of an organization.

Question 60

Moral judgment involves

A)knowing which actions are required by law.
B)knowing which actions are morally defensible.
C)realizing that an issue has ethical implications.
D)having the strength to act in accordance with your ethics.
E)adopting the values of the most relevant moral leaders.

Question 61

By discontinuing the practice of confining sows in gestation crates during pregnancy, even though doing so was not legally required, pork producer Smithfield Foods assumed the ________ of business.

A)financial responsibility
B)economic responsibility
C)ethical responsibility
D)legal responsibility
E)philanthropic responsibility

Question 62

Julia, a frontline manager, is known for her moral awareness, judgment, and character. But reporting her own boss for unethical behavior will be very difficult for her. Julia knows that she will require

A)self-righteousness.
B)immunity.
C)compensation.
D)courage.
E)legal representation.

Question 63

In accordance with corporate social responsibility, meeting societal expectations that are not written as law is a(n)________ responsibility of business.

A)economic
B)legal
C)social
D)philanthropic
E)ethical

Question 64

The Happy Egg Company, one of the largest producers of free-range eggs in the United Kingdom, seeks to put the welfare of their hens first. The company claims to operate above established free-range egg production standards. By raising their hens in this manner, Happy Eggs is assuming the ________ responsibilities of business.

A)legal
B)economic
C)moral
D)ethical
E)philanthropic

Question 65

Milton Friedman, Nobel Prize-winning economist, said, "The social responsibility of business is to increase profits," Yet his statement was ethical, in that

A)it is unethical for unelected business leaders to decide what was best for society and unethical for them to spend shareholders' money on projects unconnected to key business interests.
B)it is unethical to redistribute wealth.
C)it is unethical to preserve the environment.
D)it is unethical to spread capitalism.
E)it is unethical to improve the quality of life.

Question 66

"I asked my manager why our firm supports various causes and charities, instead of focusing solely on maximizing profits," said Alex. "She said that one of our core values is contributing to the long-term welfare of others, and the name of that value is

A)globalization."
B)the triple bottom line."
C)our legal responsibility.
D)our economic responsibility."
E)stewardship".

Question 67

Javi Torres, general manager of Fabricated Products, Inc., told his mentor, "I find it difficult to balance our economic, legal, ethical, and philanthropic responsibilities in my decision-making." His mentor replied, "Javi, the accumulated evidence indicates that

A)managers can benefit their organizations only by growing profits."
B)managers are not responsible for behaving ethically when dealing with their stakeholders."
C)social responsibility is associated with better financial performance."
D)managers must emphasize ethical behavior toward stakeholders at the cost of growing profits."
E)profits and ethical behavior cannot go hand in hand."

Question 68

One of the five higher goals of a transcendent education is

A)self-awareness.
B)independence.
C)eloquence.
D)tolerance.
E)civil aspiration.

Question 69

The business community's view toward environmental issues has changed in the twenty-first century because

A)business now sees such issues as a no-win situation.
B)business now sees such issues as a burden and a cost.
C)business now sees such issues as a business opportunity.
D)business now sees such issues as yesterday's problem.
E)business now sees such issues as overblown hype.

Question 70

Madison, a manager, is considering having to lay off Roy, because Roy's skills do not match the company's needs in a changing marketplace. Roy is a popular employee, and Madison knows that laying off Roy will have a negative impact on the morale of other employees, among other ethical implications. In the context of making an ethical decision, this stage is known as moral

A)certainty.
B)ability.
C)awareness.
D)judgment.
E)characterization.

Question 71

Eduardo, an account executive, has a difficult ethical decision to make regarding one of his clients. In determining what to do, he knows that

A)he must not take actions that will be financially detrimental to his employer or his client.
B)he must be willing to take action that is illegal.
C)he must determine economic outcomes, consider legal requirements, and evaluate ethical duties.
D)his decision must not negatively affect his employer's business relationship with the client.
E)he will need to communicate his decision to his employer's other clients.

Question 72

Smith's Hardware supports Habitat for Humanity, a nonprofit that builds affordable housing for those struggling with poverty, housing, or homelessness. Donation to such an organization is an example of ________ responsibility.

A)economic
B)legal
C)conventional
D)ethical
E)philanthropic

Question 73

A company's requirement to be profitable represents its

A)economic responsibility.
B)relative responsibility.
C)ethical responsibility.
D)philanthropic responsibility.
E)legal responsibility.

Question 74

Within the pyramid of global corporate social responsibility and performance, doing what is required by global stakeholders is categorized as a(n)________ responsibility.

A)economic
B)legal
C)financial
D)philanthropic
E)ethical

Question 75

"It's not all about profit," said Tom to his young accountant. "We have to always keep in mind the 'triple bottom line', and that means our stakeholders' broader expectations of

A)economic, philanthropic, and social performance."
B)economic, social, and environmental performance."
C)economic, philanthropic, and legal performance."
D)legal, ethical, and social performance."
E)legal, environmental, and social performance."

Question 76

A company's efforts to be a good global corporate citizen, such as supporting community programs, represents its

A)economic responsibility.
B)legal responsibility.
C)ethical responsibility.
D)philanthropic responsibility.
E)financial responsibility.

Question 77

Laura Higgins, Chief Ethics Officer for WrightWay Corporation, told her CEO, "We must identify actions that will maximize profits while satisfying the demand for corporate social responsibility from multiple stakeholders. To do this, we should evaluate actions as we would all other investment decisions, by

A)responding only to the demands of our shareholders."
B)considering only those actions that are required by law."
C)performing cost-benefit analyses of the actions."
D)emphasizing short-term revenues over longer-term considerations."
E)ignoring economic impacts of the actions."

Question 78

The order of the levels in the pyramid of global corporate social responsibility and performance from bottom to top is

A)economic, legal, philanthropic, and ethical.
B)ethical, economic, legal, and philanthropic.
C)economic, legal, ethical, and philanthropic.
D)legal, economic, ethical, and philanthropic.
E)philanthropic, economic, legal, and ethical.

Question 79

The CEO of Southwest Groceries, Inc. has asked you to enhance the firm's public image through its ethical responsibilities. Thus, you are most likely to propose that the company

A)sell groceries at a discount to frequent customers.
B)re-compete major supplier contracts to reduce costs and increase profits.
C)contract with a professional staffing agency to fill key management positions.
D)implement a home delivery service to differentiate the firm from its competitors.
E)only sell dairy and meat products originating from animals living in humane environments.

Question 80

________ responsibilities of business are to produce goods and services that society wants at a price that perpetuates the business and satisfies its obligations to investors.

A)Economic
B)Legal
C)Environmental
D)Philanthropic
E)Ethical