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Exam 4: Demanding Ethical and Socially Responsible Behavior

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Question 21

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A business that takes a public position on a political issue that affects the welfare of society is exercising corporate social responsibility. Corporate policy is one dimension of social responsibility.It refers to the position a firm takes on issues that affect the firm and society,including political issues.

A) True
B) False

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Question 22

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Punishing business leaders who have broken the law may help restore trust in the free-market system and leaders in general. Given the ethical lapses that are so prevalent today,several things can be done to restore trust in the free-market system and leaders in general: (1)those who have broken the law need to be punished accordingly including religious people,government people,and businesspeople; (2)new laws making accounting records more transparent should be passed;and (3)making businesspeople and others more accountable may help.

A) True
B) False

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Question 23

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The Legal Briefcase box,"Paying the Price" talks about illegal acts committed by executives at Enron,WorldCom,and Tyco International.This discussion demonstrates that business crimes are clearly illegal according to law,but seldom do they affect the operations of firms. Enron and WorldCom are no longer in business.Tyco International suffered a severe image problem.Investors pounded the stock price of all three companies.CEOs and other top executives that commit grievous acts can permanently affect the firm's operations and future.

Which of the following questions will help individuals and organizations when deciding if their decisions are ethical?

Mini-Case Harry,Sirly,and Bo are in the midst of a heated discussion.As the chief operating officers of the U-Scream Ice Cream Corporation,they are reviewing the latest financial reports.Intense competition has resulted in deceased profits.Each of the three officers has their own view of how to reverse the current trend. Harry suggests cutting costs by firing union employees and hiring replacement workers at lower wages.He has directed the firm's attorney to find a loophole in the contract that will allow for this action.Sirly protests,stating that Harry's proposal is unethical and unfair.Sirly feels that every stakeholder should be treated equally,and that profiting at the expense of others is foolhardy. Bo,agreeing in part with Sirly,states,"We must be sensitive to all affected parties,but clearly our primary goal is to make a profit for our owners." In an attempt to resolve the conflict between Harry and Sirly,Bo offers an alternative suggestion: reduce the firm's charitable contributions until acceptable profit levels are realized.Sirly is outraged and reminds Bo of the social responsibilities that U-Scream Ice Cream has to the community,environment,suppliers,employees,and stockholders. -Sirly recommends a marketing strategy aimed at increasing sales through the development of a positive corporate image.He suggests the first step towards this goal is to identify and evaluate the firm's programs for community involvement.Sirly is calling for a ________ to be completed.

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

At a recent town hall meeting,citizens expressed concern regarding the impact of a proposed new gambling casino.The owner of the proposed casino responded,"I don't know what all of this fuss is about.I'm just a businessman trying to earn a profit,provide new jobs,and pay taxes." His response reflects an overall commitment to corporate social responsibility. Corporate social responsibility is the concern businesses have for the welfare of society.While a firm's primary orientation may be toward the interests of investors,the welfare of all stakeholders should be considered.

The position a firm takes on issues that affect the corporation as well as society is known as its:

We describe charitable donations by corporations to nonprofit organizations as _________.

A payoff for socially conscious behavior is:

A recent study revealed that employee fraud causes 30% of all business failures.

Creating competition between employees within the corporation:

Businesses with a formal code of ethics are less common now than in the past.

A(n) _______ -based ethics code emphasizes the prevention of unlawful behavior by increasing control and penalizing wrongdoers.

Which of the following indicates that U.S.businesses are demanding socially responsible behavior from their international suppliers?

If a business fails to meet its responsibilities to its employees,which of the following is likely to occur?

One problem with conducting a social audit is:

Management's philosophy at Apple,Inc.has often stated that a fit body contributes to more productivity at work.Apple provides exercise facilities at most of its sites across America,and permits employees to use a half-hour of work time each day to relieve stress through exercise.This serious position on physical fitness is part of Apple's __________.

Business is under pressure from society to be more socially responsible.However,even the strongest advocates for corporate responsibility can't seem to agree:

John was recently hired by Backstreet Books,an eclectic bookstore in a large college town.At the beginning of the first day on the job,his store manager handed him a small booklet consisting of company rules.He was asked to read it and sign and submit the last page,before starting work.Among other things,the rules explicitly discussed reprimands for grievous behavior and dismissal if the firm could prove that the employee was stealing product from the store.This booklet represented the ___________ of the store.