Chapter 01: An Overview of Ethics
True / False
1. An organization’s mission statement highlights its key ethical issues and identifies the overarching values and
principles that are important to the organization and its decision making.
a.
True
b.
False
2. Ideally, the corporate ethics officer should be a well respected, senior-level manager who reports directly to
the CEO.
a.
True
b.
False
3. In a nonprofit organization, the board of directors reports to the local community that it serves.
a.
True
b.
False
4. Consistency means that shareholders, customers, suppliers, and the community know what they can expect of
an organization-that it will behave in the future much as it has in the past.
a.
True
b.
False
Chapter 01: An Overview of Ethics
5. The greater reliance of information systems in all aspects of life has decreased the risk that information
technology will be used unethically.
a.
True
b.
False
6. Increasingly, managers are including ethical conduct as part of an employee’s performance appraisal.
a.
True
b.
False
7. Employees may suppress their tendency to act in a manner that seems ethical to them and instead act in a
manner that will protect them against anticipated punishment.
a.
True
b.
False
Chapter 01: An Overview of Ethics
8. The term morals refers to the personal principles upon which an individual bases his or her decisions about
what is right and what is wrong.
a.
True
b.
False
9. Laws can proclaim an act as legal, although many people may consider the act immoral.
a.
True
b.
False
10. Fairness and generosity are examples of virtues.
a.
True
b.
False
11. Lawrence Kohlberg found that the most crucial factor that stimulates a person’s moral development is
monetary reward for good behavior.
a.
True
Chapter 01: An Overview of Ethics
b.
False
12. Multinational and global organizations must not present a consistent face to their shareholders, customers,
and suppliers but instead must operate with a different value system in each country they do business in.
a.
True
b.
False
13. Legal acts conform to what an individual believes to be the right thing to do.
a.
True
b.
False
14. Ethics has risen to the top of the business agenda because risks associated with inappropriate behavior have
increased, both in their likelihood and in their potential negative impact.
a.
True
b.
False
Chapter 01: An Overview of Ethics
15. Setting corporate social responsibility (CSR) goals encourages an organization to achieve higher moral and
ethical standards.
a.
True
b.
False
16. A mission statement is a clear, concise description of the issue that needs to be addressed.
a.
True
b.
False
17. The board of directors of an organization is normally responsible for day-to-day management and operations
of the organization.
a.
True
b.
False
18. Because an activity is defined as legal, the activity is also considered ethical.
Chapter 01: An Overview of Ethics
a.
True
b.
False
19. In the business world, important decisions are too often left to the technical experts; general business
managers must assume greater responsibility for these decisions.
a.
True
b.
False
20. Individual views on what is moral are so strongly held that there is nearly universal agreement in spite of
differences in age, cultural group, ethnic background, religion, life experience, education, and gender.
a.
True
b.
False
21. Most people have developed a decision-making process they use almost automatically, without thinking
about the steps they go through.
a.
True
b.
False
Chapter 01: An Overview of Ethics
22. The countries with the highest software piracy rate in the world include Luxembourg, Japan, and New
Zealand.
a.
True
b.
False
23. Stakeholders who stand to lose or gain from a situation should be kept out of the decision making process as
they will simply introduce their personal biases.
a.
True
b.
False
24. The term ethics describes standards or codes of behavior expected of an individual by a group to which the
individual belongs.
a.
True
b.
False
Chapter 01: An Overview of Ethics
25. If the desired results are not achieved upon implementation of a solution, one should return to the “identify
alternatives” step of the decision making process and rework the decision.
a.
True
b.
False
Multiple Choice
26. Which of the following identifies the concept that an organization should act ethically by taking
accountability for the impact of its actions on the environment, the community, and the welfare of its
employees?
a.
Corporate social responsibility
b.
Corporate governance
c.
Corporate social entrepreneurship
d.
Corporate sustainability
27. Which of the following steps in the decision-making process gathers and analyzes facts and also identifies
stakeholders affected by the decision?
a.
Develop problem statement
b.
Evaluate result
c.
Identify alternatives
d.
Implement decision
Chapter 01: An Overview of Ethics
28. A set of beliefs about right and wrong behavior within a society is known as which of the following?
a.
ethics
b.
moral code
c.
law
d.
vices and virtues
29. Which of the following statements best describes a reason why organizations pursue corporate social
responsibility (CSR) goals and promote a work environment in which employees are encouraged to act ethically
when making business decisions?
a.
To enjoy higher employee turnover rates
b.
To define a variable approach for dealing with stakeholders
c.
To gain the goodwill of the community
d.
To increase unfavorable publicity
30. What term is used to describe a habit of unacceptable behavior?
a.
moral
b.
virtue
c.
ethic
d.
vice
Chapter 01: An Overview of Ethics
31. Standards or codes of behavior expected of an individual by a group (nation, organization, profession) to
which an individual belongs is known as which of the following?
a.
Ethics
b.
Virtues
c.
Laws
d.
Morals
32. Which of the following terms best describes a habit that inclines people to do what is acceptable?
a.
laws
b.
ethics
c.
virtue
d.
vice
33. The piracy rate is nearly 80 percent across which continent?
a.
Asia
b.
North America
c.
Europe
d.
Africa
Chapter 01: An Overview of Ethics
34. Companies that develop and maintain strong employee relations:
a.
build indifference to the organization’s goals.
b.
erode employee involvement.
c.
enjoy lower turnover rates.
d.
face low employee morale.
35. In the case of United States v. New York Central & Hudson River Railroad Co., the U.S. Supreme Court
established that:
a.
executives in an organization with an effective ethics program can receive lesser sentences for
unethical actions.
b.
an employer can be held responsible for the acts of its employees even if the employees act in a
manner contrary to their employer’s directions.
c.
organizations can escape criminal liability if they make strong efforts to prevent and detect
misconduct in the workplace.
d.
officers of companies cannot be given light sentences if their ethics program fail to deter criminal
activity within their firms.
36. A rapid increase in the appointment of corporate ethics officers typically follows:
a.
the acquisition of one company by another.
b.
the revelation of a major business scandal.
c.
the appointment of a new CEO.
d.
a substantial decrease in the stock price of a firm.
Chapter 01: An Overview of Ethics
37. Based on a 2013 National Business Ethics Survey, the percentage of employees who said they reported
misconduct in the workplace when they saw it is characterized by which of the following statements?
a.
increased from 2011 to 2013
b.
decreased from 2011 to 2013
c.
stayed essentially the same
d.
increased by more than 10 percentage points from 2007 to 2009
38. The goodwill that is created by which of the following can make it easier for corporations to conduct their
business?
a.
profits
b.
alliances
c.
incentives
d.
CSR activities
39. In which step of the decision-making process should the decision makers consider laws, guidelines, policies,
and principles that might apply to the decision?
a.
develop problem statement
b.
implement decision
Chapter 01: An Overview of Ethics
c.
identify alternatives
d.
choose alternative
40. Which of the following is the most critical step in the decision-making process?
a.
Evaluation of the results
b.
Identification of alternative solutions
c.
Development of a problem statement
d.
Implementation of a decision
41. A discrepancy between employee’s own values and an organization’s actions:
a.
encourages employee commitment.
b.
increases employee involvement.
c.
fosters poor performance.
d.
creates high morale.
42. Someone who stands to gain or lose, depending on how a situation is resolved is known as which of the
following?
a.
negotiator
b.
figurehead
Chapter 01: An Overview of Ethics
c.
stakeholder
d.
philanthropist
43. Which of the following activities describes when an organization reviews how well it is meeting its ethical
and social responsibility goals, and communicates its new goals for the upcoming year?
a.
ethics review
b.
performance appraisal
c.
social audit
d.
morals assessment
44. A well-implemented ethics and compliance program and a strong ethical culture can lead to:
a.
more fear of retaliation by management.
b.
less comfort for employees reporting misconduct.
c.
more negative views on the organization.
d.
less pressure on employees to misbehave.
45. Which of the following positions provides an organization with vision and leadership in the area of business
conduct?
a.
spiritual leader
Chapter 01: An Overview of Ethics
b.
corporate ethics officer
c.
disseminator
d.
disturbance handler
46. In a for-profit organization, the primary objective of which of the following is to oversee the organization’s
business activities and management for the benefit of shareholders, employees, customers, suppliers, and the
community?
a.
negotiator
b.
board of directors
c.
corporate ethics officer
d.
corporate compliance officer
47. To extend to all people the same respect and consideration that you expect from them is considered which of
the following character traits?
a.
morality
b.
ethical
c.
integrity
d.
consistency
Chapter 01: An Overview of Ethics
48. In an environment where employees are encouraged to do “whatever it takes” to get the job done, employees
may feel pressure to act in which of the following ways?
a.
with integrity
b.
unethically
c.
morally
d.
that which is culturally accepted
49. One’s personal beliefs about right and wrong are known as which of the following?
a.
virtues
b.
vices
c.
characteristics
d.
morals
50. A statement that highlights an organization’s key ethical issues and identifies the overarching values and
principles that are important to the organization and its decision making is known as which of the following?
a.
mission statement
b.
code of ethics
c.
problem statement
d.
acceptable use policy
Chapter 01: An Overview of Ethics
51. In the decision-making process of implementing the decision, what plan must be defined to explain to
people how they will move from the old way of doing things to the new way?
a.
implementation
b.
backup
c.
transition
d.
evaluation
52. Which of the following helps ensure that employees abide by the law, follow necessary regulations, and
behave in an ethical manner?
a.
mission statement
b.
acceptable use policy
c.
problem statement
d.
code of ethics
53. A clear, concise statement of an issue that needs to be addressed is known as which of the following?
a.
mission statement
b.
acceptable use policy
c.
problem statement
d.
code of ethics
Chapter 01: An Overview of Ethics
54. A code of ethics cannot gain company-wide acceptance unless it is fully endorsed by the organization’s
leadership and developed with which of the following?
a.
employee participation
b.
board of directors
c.
business partners
d.
shareholders
55. During which step of the decision-making process should one be extremely careful not to make assumptions
about the situation?
a.
identify alternatives
b.
implement decision
c.
evaluate results
d.
develop problem statement
Subjective Short Answer
56. What is a social audit? Explain.
Chapter 01: An Overview of Ethics
57. Describe two trends that have increased the likelihood of unethical behavior.
58. In the context of an ethical decision-making process, discuss the importance of communication in
implementing a change.
59. Discuss the role of the board of directors in creating an ethical organization.
Chapter 01: An Overview of Ethics
60. Briefly describe the difference between morals, ethics, and laws.