Deck 5: Globalization and Society

Question 1

Which of the following statements about GE and its "Green is Green" movement is true?

A)GE is responding in part to the fact that it is operating in many countries which require compliance with higher environmental standards than exist in the United States.
B)GE has decided to develop new products that are environmentally friendly rather than adopt internal policies to reduce greenhouse gas emissions.
C)GE has moved aggressively to reduce greenhouse gas usage internally but has not been able to develop commercially viable "clean" technologies.
D)GE considered joining the U.S. Climate Action Partnership but decided the group was too radical in its approach to reducing greenhouse gas emissions.

Answer 1

A

Question 2

Which stakeholders must companies satisfy? What role should stakeholders play in a firm's internal code of conduct?

Answer 2

Stakeholders include stockholders, employees, customers, and society at large.In the short term, the aims of these groups conflict.Stockholders want additional sales and increased productivity, which result in higher profits and larger returns going to them.Employees want additional compensation.Customers want lower prices.And society at large would like to see increased corporate taxes or corporate involvement in social functions.In the long term, all of these aims must be achieved adequately, or none will be attained at all because each stakeholder group is powerful enough to cause the company's demise.When developing an internal code of conduct, firms need to communicate company policies to employees, suppliers, and subcontractors to ensure that everyone involved understands what behavior is acceptable.External stakeholders should receive reports of how the code of conduct is functioning.

Question 3

________ is one of the primary business objectives for pursuing ethical behavior.

A)Replacing home-country technology with host-country technology
B)Minimizing federal investigations into corporate finances
C)Avoiding being perceived as a socially irresponsible firm
D)Imposing home-country behavior on the host country

Answer 3

C

Question 4

An important business objective for pursuing ethical behavior is to create a better relationship with corrupt politicians and customers.

Question 5

According to Transparency International, companies from which of the following countries are more likely to pay bribes?

A)China
B)Japan
C)Singapore
D)Belgium

Question 6

Bantam Enterprises, a multinational enterprise, makes significant efforts to avoid being perceived as socially irresponsible.What is the most likely reason for this?

A)Social irresponsibility can lead to labor strikes by international unions.
B)Socially irresponsible companies usually have fewer exports and more imports.
C)Cultural barriers increase for companies that are socially irresponsible, which hinders expansion into additional countries.
D)Social irresponsibility can lead to negative publicity from nongovernmental organizations, which could hurt a company's reputation.

Question 7

Explain why the argument that "anything that is legal is ethical" is insufficient.

Question 8

Which stakeholder group primarily wants additional sales and increased productivity?

A)customers
B)shareholders
C)society at large
D)government

Question 9

In the long run, MNEs must adequately meet the needs of all stakeholders in order to prosper and survive.

Question 10

Which of the following is a primary business objective for pursuing ethical behavior?

A)avoiding industrial sanctions
B)developing competitive advantages
C)developing creative advertisements
D)discouraging false commitments to the firm

Question 11

Stockholders are typically more interested in corporate social responsibility than in earning profits.

Question 12

Which stakeholder group is most interested in trustworthy behavior by corporate executives and increased corporate taxes?

A)shareholders
B)society
C)employees
D)customers

Question 13

Which of the following is NOT a key stakeholder group that a company must work to satisfy in order to survive in a global environment?

A)employees
B)competitors
C)shareholders
D)customers

Question 14

Under the practice of extraterritoriality, legal and ethical values in a country may cause its companies to operate abroad according to home country laws rather than host country laws.

Question 15

What types of payments are legal and illegal under the Foreign Corrupt Practices Act (FCPA)of the United States? Provide an example.

Question 16

GE's Ecomagination program has enabled the firm to develop a competitive advantage over its competitors.

Question 17

Which of the following is one of the primary business objectives for pursuing ethical behavior?

A)avoiding industrial sanctions
B)developing competitive advantages
C)developing creative advertisements
D)discouraging false commitments to the firm

Question 18

According to the text, which of the following has resulted from GE's Ecomagination initiative?

A)rising profitability for many GE products
B)increasing doubt among GE's foreign partners
C)reducing investments by GE due to poor returns
D)improving pollution levels near GE plants in China

Question 19

General Electric's Ecomagination initiative is responding in part to the fact that it is operating in many countries that require compliance with higher environmental standards than exist in the United States.

Question 20

Which of the following statements is most likely true regarding relationships between MNEs and stakeholders?

A)An MNE typically serves all stakeholder groups equally at any given time.
B)No individual stakeholder group is powerful enough to cause the demise of an MNE.
C)All stakeholders of an MNE have the same short-term and long-term goals and interests.
D)The inability to adequately meet the long-term needs of all stakeholders increases the probability of an MNE failing.

Question 21

What is the primary problem associated with Anglo American PLC's ART program?

A)unknown side effects to drugs and treatment
B)rising costs of medications and procedures
C)poor treatment adherence by employees
D)lack of sufficient insurance coverage

Question 22

Which level of moral development involves an individual learning role-conformity from peers, parents, and laws?

A)conventional
B)principled
C)autonomous
D)preconventional

Question 23

A manager practicing relativism would most likely ________.

A)adapt to local conditions instead of implementing home-country practices
B)enforce home-country laws on host-country employees and suppliers
C)refuse to change company policies and procedures to comply with local norms
D)apply universal laws to each country despite local customs and traditions

Question 24

The belief that there are universal standards of behavior that all cultures should follow is called ________.

A)humanism
B)relativism
C)normativism
D)naturalism

Question 25

What is the difference between relativism and normativism? How do these concepts relate to ethical behavior in international business?

Question 26

The teleological approach asserts that individuals make moral judgments independent of consequences.

Question 27

According to utilitarianism, actions are moral if they produce the greatest amount of good for the greatest number of people.

Question 28

What is the primary reason that Anglo American PLC developed its ART program?

A)comply with government standards
B)maintain a healthy workforce
C)abide by union demands
D)reduce employee benefits

Question 29

Relativism is the theory that ethical truths depend on the values of the groups holding them; thus, MNEs should adhere to or adopt the cultures of the countries in which they are located.

Question 30

Pursuing responsible behavior for strategic and financial success is an example of relative behavior.

Question 31

The saying "When in Rome, do as the Romans do" applies to the ________ approach.

A)teleological
B)relativism
C)normativism
D)deontological

Question 32

According to the teleological approach, individuals base moral decisions on ________.

A)personal and social responsibilities
B)consequences of an action
C)cultural value systems
D)opinions of peers

Question 33

Encouraging ethical behavior for the purpose of developing competitive advantages will most likely result in all of the following for a firm EXCEPT ________.

A)strategic accomplishment
B)consumer commitment
C)industry resolutions
D)financial success

Question 34

General Electric has focused on being more "green" in recent years most likely because ________.

A)the industry has always looked to GE as a trend setter in green technology
B)GE executives believe the firm can strategically align investor and environmental interests
C)GE executives realize that the firm can save significant money through the use of solar technology
D)the U.S. government has decided to use GE as a test case to see if the adoption of the Kyoto Protocol can actually work for a U.S. firm

Question 35

How have sustainability demands and the Kyoto Protocol affected international business? Discuss the controversies surrounding each.

Question 36

Normativism asserts that universal standards of behavior exist and should be accepted in all cultures.

Question 37

Which of the following statements is most likely true about the postconventional level of moral development?

A)Individuals learn what is moral but not why such behavior is moral.
B)Individuals behave morally because they fear negative repercussions.
C)Individuals learn how to conform to society's values through observation.
D)Individuals behave morally because they believe such actions are right.

Question 38

Which of the following is NOT an example of normativism?

A)A U.S. subsidiary operating in China that is forced to follow some U.S. laws, even though China has no comparable laws
B)A U.S. sweatshop operating in Thailand that does not follow U.S. labor laws but allows children to work 60 hours a week
C)An MNE manager who, after working in the host country, tries to implement foreign practices in the home-country office
D)A British subsidiary operating in Indonesia that maintains the same health and safety standards for its foreign factories that are required in Great Britain, even though the British government does not require it to use those standards

Question 39

A manager who refuses to bribe customs officials in a foreign country, even though it is morally acceptable in that country, is most likely to believe in which of the following perspectives on ethics?

A)relativism
B)normativism
C)humanism
D)existentialism

Question 40

What ethical and labor-related issues are a major challenge to footwear and clothing MNEs that operate in developing countries? What guidelines are provided by the Ethical Trading Initiative?

Question 41

Which of the following is a reason for an MNE to base its standards for ethical behavior on a country's laws?

A)The law embodies many of a country's moral beliefs but is an inadequate guide for proper conduct.
B)The law contains unenforceable rules that are impossible for society to follow.
C)The law represents a consensus derived from significant deliberation.
D)The law is based on precisely defined moral concepts.

Question 42

Which of the following is NOT one of the issues surrounding high levels of bribery and corruption?

A)high poverty rates
B)regional conflict
C)political unrest
D)high per capita income

Question 43

Why is the argument that "anything legal is ethical" most likely insufficient?

A)Everything that is unethical is also illegal.
B)The law is an extremely efficient way to solve ethical dilemmas.
C)Laws are frequently based on imprecisely defined moral concepts.
D)Laws can never be changed; thus, rules for all possible ethical dilemmas are found in the law.

Question 44

What is the primary concern regarding anti-corruption measures in the EU?

A)resistance to an official anti-fraud commission
B)inability to adopt a corruption definition
C)lack of uniform laws across nations
D)failure to conduct internal auditing

Question 45

Which of the following statements describes an inconsistency of the Foreign Corrupt Practices Act (FCP
A)?

A)Facilitation payments are classified as bribery.
B)Facilitation payments are excluded from the FCPA's definition of bribery.
C)Payments to officials who are not directly responsible for carrying out the law are legal.
D)Payments to foreign officials who carry out the law are considered illegal by provisions of the FCPA.

Question 46

Which of the following is NOT affected by the Foreign Corrupt Practices Act?

A)companies registered in the United States
B)foreign firms operating in U.S. territory
C)foreign firms quoted on a U.S. stock exchange
D)foreign companies managed by U.S. expatriates

Question 47

The OECD Convention against bribery is an example of a(n)________.

A)bilateral agreement developed for the EU
B)agreement that targets the demand side of bribery
C)agreement that targets the supply side of bribery
D)UN Convention dominated by developing countries

Question 48

In which of the following countries would there be the highest likelihood of encountering a bribery situation?

A)Germany
B)United States
C)South Korea
D)Russia

Question 49

An advocate of the legal-justification standard would most likely assert that the law ________.

A)develops slowly in response to evolving societal dilemmas
B)protects business activities that are unethical but not illegal
C)contains enforceable rules that apply to everyone
D)offers necessary moral flexibility for a society

Question 50

Which of the following most likely complicates ethical behavior for firms that expand overseas?

A)local laws and values
B)expatriate management
C)unstable financial settings
D)international codes of conduct

Question 51

A 1977 U.S.law that outlaws bribery payments by U.S.firms to foreign government officials is known as the ________.

A)Anti-Bribery Act of 2004
B)Foreign Corrupt Practices Act
C)Zero Tolerance Initiative
D)Sarbanes-Oxley Act

Question 52

The law is often based on imprecisely defined moral concepts that cannot be separated from legal concepts.

Question 53

The argument that "anything legal is ethical" is insufficient as a basis for ethical behavior because the law usually does not apply to everyone and does not have enforceable rules.

Question 54

Which of the following is most important when designing an internal code of conduct?

A)requesting U.N. oversight and intervention when necessary
B)communicating the code of conduct only to employees
C)reporting results to external stakeholders
D)forming local policies for each subsidiary

Question 55

The OECD Convention against bribery is an example of an agreement that targets the demand side of bribery.

Question 56

Transparency International, the OECD, and the ICC are all working to stop bribery around the world.

Question 57

A payment to a customs official to clear legitimate merchandise is permitted by the Foreign Corrupt Practices Act.

Question 58

Ethical dilemmas tend to be ________ for MNE managers than for domestic managers.

A)more complicated
B)less controversial
C)easier to decide
D)less common

Question 59

Which of the following is permitted by the Foreign Corrupt Practices Act?

A)a bribe paid by foreign firms operating in U.S. territories
B)a bribe paid by a U.S. firm operating in a foreign country that permits bribes to be paid
C)a payment to a foreign government official to influence a customs official
D)a payment to a customs official to clear legitimate merchandise

Question 60

The Foreign Corrupt Practices Act applies only to companies registered in the United States.

Question 61

Quantum Footwear is an MNE that manufactures inexpensive shoes.Quantum outsources portions of its production to independent companies located in Bangladesh and India, where child labor is common.Other clothing and footwear firms have recently faced criticism regarding the use of child labor, and Quantum executives want to avoid similar problems.Which of the following guidelines enforced by Quantum would LEAST likely be supported by the International Labor Organization?

A)establishing bridge schools
B)monitoring workplace safety
C)allowing children ages 10-15 to work a maximum of 4 hours per day
D)prohibiting abusive labor conditions

Question 62

According to the Ethical Trading Initiative (ETI), ________.

A)child labor cannot be used unless there are no suitable alternatives
B)employment need not be freely chosen in order to be acceptable
C)no harsh or inhumane treatment of workers should be allowed
D)MNEs are not responsible for establishing codes of conduct

Question 63

Monique has recently been hired as an accounts supervisor at Ballston Enterprises.She wants to understand Ballston's values and its expectations for employee behavior.Which of the following would most likely provide Monique with this information?

A)mission statement
B)code of conduct
C)vision statement
D)employee contract

Question 64

The Ethical Trading Initiative (ETI)is primarily focused on ________.

A)fair trade laws for undeveloped countries
B)tiered pricing by pharmaceutical firms
C)greenhouse gas emission reduction
D)employment practices of MNEs

Question 65

Which of the labor issues identified by the Ethical Trading Initiative (ETI)receives the most attention?

A)safe and hygienic working conditions
B)reasonable living wages
C)inhumane treatment
D)child labor

Question 66

The 1997 Kyoto Protocol is best described as an agreement that requires ________.

A)all members of the United Nations to reduce their greenhouse gas emissions by 5.2 percent
B)the United States and Japan to control greenhouse gas emissions by 8% below 1995 levels
C)the signatory countries to cut greenhouse gas emissions to 5.2 percent below 1990 levels
D)the signatory countries to reduce greenhouse gas emissions by 80% by 2050

Question 67

U.S.MNEs that operate in Europe are under pressure to conform to the emissions standards of the Kyoto Protocol.

Question 68

How can an MNE operating in a developing country have a positive influence on labor policies? Illustrate your answer with an example.

Question 69

Governmental agencies and nongovernmental organizations monitor the behavior of companies and their employees to ensure that laws are being followed.

Question 70

Meeting the needs of the present without compromising the ability of future generations to meet their own needs is known as sustainability.

Question 71

Which of the following best supports the idea that MNEs should remain in countries that allow child labor?

A)MNEs have a positive influence on government employment policies in most foreign countries.
B)Many MNEs have substantially improved the working conditions of their foreign plants.
C)MNEs are required to pay child workers more than local companies.
D)Most MNEs employ local managers to handle cultural differences.

Question 72

Quantum Footwear is an MNE that manufactures inexpensive shoes.Quantum outsources portions of its production to independent companies located in Bangladesh and India, where child labor is common.Other clothing and footwear firms have recently faced criticism regarding the use of child labor, and Quantum executives want to avoid similar problems.Which of the following would be the best approach for Quantum?

A)improving conditions at the subcontract facilities
B)developing an external ethics code for foreign partners and letting them worry about compliance
C)requiring local governments to alter their labor policies
D)leaving the market and focusing on domestic production

Question 73

Firms that operate in countries that have adopted the Kyoto Protocol are required to either reduce emissions or ________.

A)purchase carbon credits from other firms
B)file petitions to appeal the requirement
C)cease manufacturing operations
D)pay fines to the UN

Question 74

According to the Ethical Trading Initiative, child labor cannot be used unless there are no suitable alternatives for employees.

Question 75

How has the Kyoto Protocol affected U.S.companies operating in Europe?

A)U)S. companies are changing the way they do business in order to comply with new emissions standards in Europe.
B)The Kyoto Protocol has not affected U.S. companies with subsidiaries in Europe because the U.S. has not signed the Kyoto Protocol.
C)Before U.S. companies can open any more European subsidiaries, the U.S. government must sign the Kyoto Protocol.
D)Because the United States is not a party to the Kyoto Protocol, U.S. companies may not operate in European countries that have signed the Kyoto Protocol.

Question 76

What is the Foreign Corrupt Practices Act? How has this law affected ethical behavior among international businesses?

Question 77

The issues that are the foundation of the Ethical Trading Initiative (ETI)include all of the following EXCEPT ________.

A)employment is freely chosen
B)working conditions are safe and hygienic
C)child labor shall not be used
D)workers receive hourly wages that are consistent around the world

Question 78

Meeting the needs of the present without compromising the ability of future generations to meet their own needs is known as ________.

A)competitive advantage
B)the Kyoto Protocol
C)sustainability
D)externality

Question 79

The Petrobras oil company scandal involved companies outside Brazil.

Question 80

Which of the following best explains Nike's quick response to criticism of unfair employment practices in developing countries?

A)retaining employees
B)improving public relations
C)addressing product safety concerns
D)cutting costs in order to improve profits