Business Ethics: Case Studies and Selected Readings 8th Edition

SECTION 1A – DEFINING ETHICS This unit begins with a personal look at ethics: what ethics are and how to resolve ethical dilemmas. This section also includes an introduction to the credo – something the students should be working on as they study the materials in the text and throughout their course.

SECTION 1B – RESOLVING ETHICAL DILEMMAS READING 1.9 – SOME SIMPLE TESTS FOR RESOLVING ETHICAL DILEMMAS 1. Management Guru: Dr. Peter Drucker – Use PowerPoint Slide 22 Note: Sadly, Dr. Drucker passed away just after the 5th edition of this book was published. He is remembered for his clear

SECTION 2A – BUSINESS AND ETHICS: HOW DO THEY WORK TOGETHER? READ ING 2.1 – WHAT’S DIFFERENT ABOUT BUSINESS ETHICS? A. The Application of Moral Standards to Business Dilemmas

SECTION 2B – WHAT GETS IN THE WAY OF ETHICAL DECISIONS IN BUSINESS? READING 2.4 – HOW LEADERS LOSE THEIR WAY: WHAT PRICE HUBRIS? Use PowerPoint Slides 51 and 52. Answers and Key Discussion Items 1. The credo keeps you grounded. Andersen’s credo was that he would never certify statements that were

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UNIT THREE – BUSINESS, STAKEHOLDERS, SOCIAL RESPONSIBILITY, AND SUSTAINABILITY SECTION 3A – BUSINESS AND SOCIETY: THE TOUGH ISSUES OF ECONOMICS, SOCIAL RESPONSIBILITY, AND BUSINESS This section discusses the relationship between and among, ethics, stakeholders, moral responsibility, social responsibility, and sustainability. There is also discussion about various economic systems, such as capitalism, and ethics.

SECTION 3B – APPLYING SOCIAL RESPONSIBILITY AND STAKEHOLDER THEORY CASE 3.8 – SKITTLES, TRAYVON MARTIN, AND SOCIAL RESPONSIBILITY Use PowerPoint Slide 101. Answers and Key Discussion Items 1. Have the students discuss the line between allowing a social movement

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UNIT FOUR – ETHICS AND COMPANY CULTURE SECTION 4A – TEMPTATION AT WORK FOR INDIVIDUAL GAIN AND THAT CREDO READING 4.1 – THE MOVING LINE George Lefcoe Use PowerPoint Slide 120. Professor Lefcoe, the author of numerous treatises in real

SECTION 4B – THE ORGANIZATIONAL BEHAVIOR FACTORS READING 4.3 – WHY CORPORATIONS CAN’T CONTROL CHICANERY Saul Gellerman Answers and Key Discussion Items 1. The author has several areas that require structural modifications (Use PowerPoint Slide 127): Boards of Directors – Need to be full-time; need to play the role of an inspector general and have unannounced

SECTION 4C – THE PSYCHOLOGICAL AND BEHAVIOR FACTORS READING 4.9 – THE LAYERS OF ETHICAL ISSUES: INDIVIDUAL, ORGANIZATION, INDUSTRY, AND SOCIETY Use PowerPoint Slide 145. Answer and Key Discussion Items 1. Initially, the use of steroids began at an individual level – individual players and trainers discovered that they could get ahead by doing something

SECTION 4D – THE STRUCTURAL FACTORS: GOVERNANCE, EXAMPLE, AND LEADERSHIP READING 4.14 – RE: A PRIMER ON SARBANES-OXLEY AND DODD-FRANK Use PowerPoint Slides 147 - 161. Key Discussion Items The following issues could or should have been addressed and were

SECTION 4E – THE INDUSTRY PRACTICES AND LEGAL FACTORS READING 4.19 – THE SUBPRIME SAGA: BEAR STEARNS, LEHMAN, MERRILL, AND CDOs Use PowerPoint Slides 174 - 177 as a backdrop for the case, have the students think about the following ethical issues in the subprime saga: Taking advantage of borrowers who were high

SECTION 4F: THE FEAR-AND-SILENCE FACTORS CASE 4.23 – HEALTHSOUTH: THE SCRUSHY WAY Use PowerPoint Slides 204 - 209. Answers and Key Discussion items 1. The HealthSouth culture was similar to the cultures at FINOVA (Case 4.11), Bausch & Lomb (Case 4.26), Enron (Case 4.20), WorldCom (Case 4.15), and Tyco (Case 4.25):

SECTION 4G – THE CULTURE OF GOODNESS CASE 4.32 – BERNIE MADOFF: JUST STAY AWAY FROM THE SEVENTEENTH FLOOR Answers and Key Discussion Items 1. Discuss with the students whether we who are beneficiaries have obligations to speak up when we are concerned. There were flags in the Madoff case, from

UNIT FIVE – ETHICS AND CONTRACTS SECTION 5A – CONTRACT NEGOTIATIONS: ALL IS FAIR AND CONFLICTING INTEREST CASE 5.1 – THE GOVERNOR AND NEGOTIATIONS FOR FILLING A PRESIDENT’S SENATE SEAT Use PowerPoint Slides 229 - 232. Answers

SECTION 5B – PROMISES, PERFORMANCE, AND REALITY CASE 5.6 – PAYDAY LOANS AND CHECKING ACCOUNT DEDUCTIONS Answers and Key Discussion Items 1. The loans are risky – hence their high cost. Those who need them have financial issues and the collectability is doubtful. However, there is no hope once

UNIT SIX – ETHICS IN INTERNATIONAL BUSINESS SECTION 6A – CONFLICTS BETWEEN THE CORPORATION’S ETHICS AND BUSINESS PRACTICES IN FOREIGN COUNTRIES READING 6.1 – WHY AN INTERNATIONAL CODE OF ETHICS WOULD BE GOOD FOR BUSINESS Use PowerPoint Slide 245 (Figure 6.1) – “The Interdependence of Trust, Business, and Government”. Also use PowerPoint Slides 246 - 254

SECTION 6B – BRIBES, GREASE PAYMENTS, AND "WHEN IN ROME . . ." READING 6.10 – A PRIMER ON THE FCPA Answers and Key Discussion Items 1. Use PowerPoint Slides 261 and 262. Companies

UNIT SEVEN – ETHICS, BUSINESS OPERATIONS, AND RIGHTS SECTION 7A – WORKPLACE SAFETY READING 7.1 – TWO SETS OF BOOKS ON SAFETY Use PowerPoint Slides 267 and 268. Answers and Key Discussion Items 1. Be sure to have the students understand that two sets of books, whether in financial reporting or safety, present the

SECTION 7B – WORKPLACE LOYALTY CASE 7.6 – AARON FEUERSTEIN AND MALDEN MILLS Use PowerPoint Slide 275. Answers and Key Discussion Items 1. Mr. Feuerstein’s conduct demonstrated that it is possible to consider employee

SECTION 7C – WORKPLACE DIVERSITY AND ATMOSPHERE CASE 7.15 – ENGLISH-ONLY EMPLOYER POLICIES Answers and Key Discussion Items 1. The question is set up so that some students are trapped into an opinion. This case is a sensitive and emotional one. Bring them back around to analysis, not emotion. Have the

SECTION 7D – WORKPLACE DIVERSITY AND PERSONAL LIVES CASE 7.20 – JULIE ROEHM: THE WALMART AD EXEC WITH EXPENSIVE TASTES This case is an excellent credo case. Ms. Roehm has crossed some lines professionally and personally and the result has been a devastating impact on her career and professional reputation.

SECTION 7E – WORKPLACE CONFRONTATION READING 7.24 – THE ETHICS OF CONFRONTATION Use PowerPoint Slide 290 and Case 7.27 in combination here. Answers To Discussion Questions 1. The fear of confrontation or the failure to confront often results in unnecessary harm to an individual, group, or even society. Sometimes there is physical harm

. SECTION 7F – WORKPLACE AND THE ENVIRONMENT CASE 7.28 – EXXON AND ALASKA Use PowerPoint Slide 293 to give a summary of the extent of damage done by the oil spill. Answers and Key Discussion Items 1. Exxon's attitude about the oil spill was very much criticized by government officials, local residents and

UNIT EIGHT – ETHICS AND PRODUCTS SECTION 8A – ADVERTISING CONTENT CASE 8.1 – SKECHERS AND THE MUSCLE-BUILDING SHOE Answers and Key Discussion Items 1. There were promises of performance and statements of fact – there were studies cited and notions of muscle fitness. 2. The claims seem wild to a reasonable and prudent person,

SECTION 8B – PRODUCT SAFETY READING 8.5 – FROM SHUNNING TO ANONYMITY Use PowerPoint Slides 299 - 303 to review the law on product liability. Answers and Key Discussion Items 1. The standards have evolved from caveat emptor to caveat vendor. The liability rests with those who 2. The Nader

SECTION 8C – PRODUCT SALES CASE 8.13 – CARDINAL HEALTH, CVS, AND OXYCODONE SALES Answers and Key Discussion Items 1. Because the companies are responsible for the actions of their agents, subsidiaries and employees. 2. These are all rationalizations that help employees avoid the concerns they may feel as they witness 3. They should

SECTION 8D – PRODUCTS AND SOCIAL ISSUES CASE 8.19 – THE MOMMY DOLL Answers and Key Discussion Items 1. The concern about that doll is that it would glorify, encourage, and make look glamorous teenage 2. People differ in their views on the doll. Some see the doll as a means of

UNIT NINE – ETHICS AND COMPETITION SECTION 9A – COVENANTS NOT TO COMPETE READING 9.1 – A PRIMER ON COVENANTS NOT TO COMPETE: ARE THEY VALID? Use PowerPoint Slides 322 - 324. Answers and Key Discussion Items 1. The courts are trying to strike a balance between the

SECTION 9B – ALL'S FAIR, OR IS IT? READING 9.4 – ADAM SMITH: AN EXCERPT FROM THE THEORY OF MORAL SENTIMENTS Answers and Key Discussion Items 1. We judge others by our own feelings and experience. Those are things with which we

SECTION 9C – INTELLECTUAL PROPERTY AND ETHICS CASE 9.11 – TIFFANY, LOUIS VUITTON, eBAY, LANDLORDS, AND KNOCK-OFFS Use PowerPoint Slide 329. Answers and Key Discussion Items 1. We worry about knock-off goods because of the free-rider

If whistleblowers do not have internal avenues for dealing with issues, they will quit or turn to external avenues. Alcohol ads carry the additional issues of safety for the users. Answer: T Goldman was originally founded as a partnership. Answer: T Attending a class on company time would be unethical. Answer: Answer: T Nonprofits have fallen victim

Alice is a secretary in your department. Alice is also a member of the American Guild of Organists. Alice has been placed in charge of the Guild's national convention. Each time you pass by Alice's desk or go to her to have some work done, you notice she is on the

You work for a construction firm that is submitting a bid for the construction of a new company headquarters building for Smithco. A friend you have known since high school works in Smithco's capital budgeting area and has full knowledge of all the bids from all firms. It would be

What was a reason for the city of Detroit's bankruptcy? a. The disparity between the amount due in pension payments and the amount in the fund and coming in b. Payments for gun-related crimes c. The GM pension plan d. All of the above The claims in the Skecher shoe ads: a. Involved a breach

Discuss the dangers in earnings management. Kyphon employees sold, sold, sold Kyphon's products for spinal fracture repairs. One rep took his territory's sales from $16,000 a month to $200,000 per month in less than a year. Incentive programs do produce miracles. Kyphon, now Medtronics Spine, faced Medicare fraud allegations when two former

Tylenol's competitors were able to win customers when Tylenol's quality control problem was revealed. Both Kozlowski and Tyco were generous in their philanthropic activities. Answer: T Taking advantage of a party in a contract situation due to the party's inexperience, and not due to any lack of disclosure on your part, is

What methods do businesses use to obtain minority-owned business status? a. Hold ownerships with a silent minority partner b. Relocate in order to have minority employees c. Use a name that carries minority connotations d. All of the above What did Herman Miller gain through its environmental initiatives? a. Extra costs b. Solid reputation with regulators c.

Which of the following ethical theorists subscribes to self-interest? a. Ayn Rand b. Adam Smith c. Thomas Hobbes d. a and c only e. All of the above Ben Small, a sole practitioner, has just decided to form a law partnership with his lifetime friend, Harvey Steptoe. They agree to name the firm Steptoe and

Thomas Hobbes felt that we needed strong government control in order to achieve ethical behavior. Labeling infertility surgery as "diagnostic surgery" in order to allow the patient to recover the costs from an insurer is unethical. Answer: T A credo consists of how you define yourself by job title and income. Answer: F Winking

One newspaper headline, following Prudhoe Bay and the refinery explosion read, "BP = Big Problems for Oil Giant." Who of the following would feel a connection with the headline test? a. Peter Drucker b. Warren Buffett c. Albert Carr d. Robert Halfon Who said, "I am incredibly nervous that we will implode in a wave

Slotting fees can lead to under-the-table payments to individuals. Executive compensation increases are often awarded despite stock performance. Answer: T The subprime market did not begin until 2007. Answer: F Slotting fees are legal. Answer: Answer: T If the earnings of a company are revealed to be false, the officers who earned bonuses based on these earnings

Who said, "What's good for me is good for all shareholders"? a. The chairman of General Motors b. Jeff Dachis of Razorfish c. Bill Gates d. Sir Alfred Coke What theories could the parents of a child injured by ingesting Buckyballs use for recovery of damages from the company? a. Strict tort liability b. Implied warranty

To whom did the internal auditor at WorldCom express concerns? a. No one; the head of internal audit was indicted as well b. Scott Sullivan c. Audit committee and the board d. Both b and c Suppose that AmTrain, a U.S.-based company, is submitting bids for the construction of a high-speed rail system in India

How many Jack-in-the-Box customers were affected by the E-Coli poisonings? a. 100 b. 150 c. 300 d. 600 What happened when John Olson issued a skeptical report on Enron? a. He was given a bonus b. He was fired c. He was recognized by the business press for his insight d. Both a and c Answer: b. He was

What happened to the Union Carbide plant in Bhopal? a. Union Carbide still operates it b. Dow acquired Union Carbide and now operates the plant c. The plant has been mothballed d. The Indian government now owns the plant and produces dry-cell batteries What was Ms. Wetlaufer's job when she met Jack Welch? a. She

A real estate agent who recommends a management firm to an apartment complex buyer without disclosing that the agent owns 50% of the firm has committed an ethical violation. What factors contribute to the failure in necessary confrontation? Answer: Students can discuss the Randi W. case and mention: fear of liability, fear

Goldman did not pay a fine to the SEC. Explain the point George Lefcoe was making with his experience with the hams as gifts. Answer: Professor Lefcoe was trying to show that we have gradual slippage on ethics as we move the line ever so slightly, within our comfort level, and then

Who was the key witness against Mr. Sandusky at his trial? a. Joe Paterno b. The Penn State athletic director c. The janitor at the football facilities d. Michael McQueary Which of the following is not considered a stakeholder? a. Competitors b. Suppliers c. Customers d. Shareholders e. All of the above are considered stakeholders Answer: a. Competitors What was the

Under Sarbanes-Oxley, when must a company file an 8-K? a. Every quarter b. Only when selling stock c. Annually d. Within one day of any changes listed in the statute Which of the following is an effective tool for stopping cultural and societal ethical shifts? a. Ethics training b. Screening c. Internal controls d. Educational standards Answer: d. Educational

Which company had to issue financial restatements because of promotional fees accounting? a. Royal Ahold b. U.S. Foodservice c. K-Mart d. All of the above Who is responsible for the losses at Chase? a. Joseph Jett b. Jerome Kerviel c. The "Rain man" d. The "London Whale" Answer: d. The "London Whale" Which is the form employers must have for

The withholding of material information in a contract relationship is an ethical issue as well as misrepresentation. Hilton was under intense financial pressure at the time it hired former Starwood employees. Answer: T List the factors that determine the tone at the top. Answer: Students should explain that at the top there should be

Chiquita officials said that they either had to make payments to a mercenary and terrorist group or its employees were in danger. Evaluate the company's reasoning. If my supervisor asked me to cover for him by lying about his whereabouts, I should agree to do it but remind him that I

How low did FINOVA's share price dip? a. To $1.12 b. To $0.72 c. To $0.24 d. To $0.06 How many candidates were approved for partnership in the year Hopkins was a candidate? a. 7 b. 15 c. 21 d. 47 Answer: d. 47 Why did Audi enter into a settlement with 8 Mile and Eminem? a. Audi had copied the

A professor for one of your courses has assigned reading materials from various publications. He tells you that the materials are on reserve and that each student should go and copy the materials individually. He notes that for him to copy the materials for students and then sell them or

Coca-Cola's test marketing of Frozen Coke: a. Took unfair advantage of Burger King. b. Involved stating things known not to be true. c. Gave a false impression. d. All of the above What was unique about the compounding industry? a. It was neither a state nor federally regulated industry b. It had pressure to produce compounds

It would not be unethical to continue interviewing for positions after you have already accepted employment with a particular firm. The mayor owns property next to one of the proposed sites for the city's new baseball stadium. The mayor has a conflict of interest and should not vote on the

Business Ethics, 8e Jennings TEST BANK UNIT ONE – ETHICAL THEORY, PHILOSOPHICAL FOUNDATIONS, OUR REASONING FLAWS, AND TYPES OF ETHICAL DILEMMAS True/False Questions developed economies as unethical. F 8. Kant is part of the utilitarian school

Business Ethics, 8e Jennings 59. James Dodgsen is a student in a graduate course in business. The professor in the course has given Dodgsen and his classmates a surprise quiz in class. Dodgsen did not do the reading for class that

Business Ethics, 8e Jennings UNIT TWO – SOLVING ETHICAL DILEMMAS AND PERSONAL INTROSPECTION True/False Questions standards. F 2. Leaders who are focused on their own goals are less likely

Business Ethics, 8e Jennings UNIT THREE – BUSINESS, STAKEHOLDERS, SOCIAL RESPONSIBILITY, AND SUSTAINABILITY True/False Questions mandated by law. F 10. Decisions on corporate charitable contributions carry no ethical implications. T 11. Milton Friedman supports social spending

Business Ethics, 8e Jennings 81. The Duke LaCrosse players: a. Were ultimately found guilty of some criminal charges. b. Were exonerated by the North Carolina attorney general. c. Had their charges dropped by Michael Nifong. d. None of the above

Business Ethics, 8e Jennings UNIT FOUR – ETHICS AND COMPANY CULTURE True/False Questions the costs from an insurer is unethical. F 2. An industry practice that permits bill-padding is ethical. T 3. Whistleblowers have both

Business Ethics, 8e Jennings 115. Who said, “I felt like if I didn’t make the entries, I wouldn’t be working there”? a. Troy Normand b. Buford Yates c. Betty Vinson d. Cynthia Cooper 116. Who was held personally liable

Business Ethics, 8e Jennings UNIT FIVE – ETHICS AND CONTRACTS True/False Questions not due to any lack of disclosure on your part, is ethical. T 2. Long-term relationships create ethical and legal obligations between the parties through conduct and accommodations.

Business Ethics, 8e Jennings UNIT SIX – ETHICS IN INTERNATIONAL BUSINESS True/False Questions which they are located. F 7. There are not ethical issues in the use of child labor if the children’s families approve of their jobs.

Business Ethics, 8e Jennings UNIT SEVEN – ETHICS, BUSINESS OPERATIONS, AND RIGHTS True/False Questions termination. F 3. It is illegal for an employer to look on MySpace in screening potential employees. T 4. Employers are

Business Ethics, 8e Jennings 37. Who named BP the world’s most admired company? a. Fortune b. Business Ethics c. Business Week d. Forbes 38. What industry practice had BP failed to follow

Business Ethics, 8e Jennings UNIT EIGHT – ETHICS AND PRODUCTS True/False Questions received a notice from your seat belt buckle supplier that the buckles shipped to you and used in the cars made between June 94 and September 94 are defective. The defect means

Business Ethics, 8e Jennings UNIT NINE – ETHICS AND COMPETITION True/False Questions information is ethical so long as the employee has not breached an employment contract with that competitor. F 11. Leaking proprietary information to the media is not an

An agreement by an agent to accept a 10% commission from a seller who will sell goods to the agent's employer is ethical so long as the agent would have chosen that seller anyway. Explain who is affected when dog walkers don't scoop up after their dogs. Answer: Those affected are those

Warren Buffett is the CEO of: a. Home Depot. b. Berkshire Hathaway. c. Southwest Airlines. d. None of the above Provide the accounting for the following: a. EBITDA is no income b. GAAP is no income c. EBITDA is $4,000,000 d. None of the above Answer: c. EBITDA is $4,000,000 Which philosopher feels that we all hold a set of

What did Ken Lay do when Bethany McLean was researching Enron? a. Called her editor and asked that she be removed from the story b. Answered all her questions c. Thanked her for Fortune naming Enron one of the 100 best companies to work for d. None of the above How much did the

Which of the following best describes Craigslist's liability for content on its site? a. It is liable for any criminal activity that results from posting on its site b. It does not have an obligation to remove ads that involve criminal activity c. It must screen all ads d. None of the above How

Which of the following is prohibited conduct with respect to stock options? a. Backdating b. Backdating with limitations c. Springloading d. All of the above Where are most cruise companies paying taxes? a. United States b. United Kingdom c. Bahamas d. None of the above Answer: d. None of the above Because of advertising campaigns, with which of the following

The Duke LaCrosse players: a. Were ultimately found guilty of some criminal charges. b. Were exonerated by the North Carolina attorney general. c. Had their charges dropped by Michael Nifong. d. None of the above What happened to the suits for wrongful termination? a. They were dismissed in 2002 b. The employees won damages against Boeing c.

A false impression, unlike lying, is not an ethical violation. Mr. Ebbers was a Sunday School teacher at his Hattiesburg, Mississippi church. Answer: T The SEC failed to pass the shareholder say-on-pay regulation. Answer: F John Rawls is a contractarian. Answer: Answer: F With respect to #55, using your work computer and paper to complete the case

What happened to Hopkins? a. She was approved for partnership b. She was put on hold for partnership c. She was denied partnership d. None of the above The definition of "stakeholder": a. Is precise and definitive. b. Is very limited. c. Is not yet completed. d. Was developed by Milton Friedman. e. None of the above Answer: c. Is

You are a building inspector for the county. A friend of yours is a plumbing contractor. Under county regulations, all steps in plumbing construction from the initial dig to the final installation of sink and bathroom fixtures requires an inspection sign-off. Your plumbing contractor friend has just called and wants