Chapter 4: Ethics and Social Responsibility
TRUE/FALSE
1. Ethics is the set of moral principles or values that defines right and wrong for a person or group.
2. Ethical behavior is behavior that conforms to an organization’s accepted principles of right and wrong.
3. Workplace deviance is unethical behavior that violates organizational norms about right and wrong.
4. Workplace deviance can be categorized in terms of how deviant the behavior is and the organizational
cost of the deviant behavior.
5. Larry Torres was caught having somebody else check in for him at his $24.62–an-hour job in the
Chicago Streets and Sanitation Department. His behavior is an example of workplace deviance.
6. The four types of workplace deviance are production deviance, property deviance, political deviance,
and personal aggression.
7. Gossiping about coworkers would be considered an example of personnel deviance.
8. Under the U.S. Sentencing Commission Guidelines, companies can be prosecuted and punished for the
illegal or unethical actions of employees, even if management didn’t know about the unethical
behavior.
9. Under the U.S. Sentencing Commission Guidelines, a culpability score is a way of assigning blame to
a company.
10. Under the U.S. Sentencing Commission Guidelines, companies without compliance programs can pay
fines many times larger than companies with established compliance programs.
11. Agreement on whether behavior is good or bad is defined as the level of ethical acceptance.
12. Magnitude of consequences is the total harm or benefit derived from an ethical decision.
13. Ethical intensity is the result of only four factors. They are magnitude of consequences, social
consensus, probability of effect, and concentration of effect.
14. Proximity of effect is the time between an act and the consequences the act produces.
15. Probability of effect is the chance that something will happen and then result in harm to others.
16. Concentration of effect is how much an act affects the average person.
17. Kohlberg’s three phases of moral development in order are law and order, instrumental exchange, and
universal principle.
18. People at the postconventional level of moral development make moral decisions based on selfish
reasons.
19. All adults reach the postconventional stage of morality.
20. Under the principle of distributive justice, if one person cannot visit a public attraction due to a lack of
wheelchair accessibility, then no one should be able to visit it.
21. According to the What Really Works, “Integrity Tests,” overt integrity tests are more effective in
predicting job performance than they are in predicting employee theft.
22. In order to ensure that a company’s ethics code will encourage ethical decision making and behavior,
companies need to accomplish two objectives. The first is to communicate the codes to others both
within and outside the company, and the second is to develop practical ethical standards and
procedures specific to the company’s line of business.
23. Personality-based integrity tests are virtually useless for estimating a job applicant’s honesty.
24. The first step in establishing an ethical climate in a company is for managers to act ethically
themselves.
25. Richard Ceballos, a California deputy district attorney, suspected that a deputy sheriff had included
false statements in a search warrant affidavit. Ceballos told his supervisors and the defense attorney in
the case about his suspicions. Ceballos claims he was then demoted and transferred in retaliation for
speaking out on a matter of public concern. This is an example of how whistleblowing should work.
26. There is general agreement regarding what is socially responsible corporate behavior.
27. When CEO Louis Chênevert of United Technologies takes steps to reduce his company’s energy
consumption, he is acting socially responsible.
28. The shareholder model and the stakeholder model are two techniques for determining to whom
organizations should be socially responsible.
29. The shareholder model holds that management’s most important responsibility is long-term survival
(not just maximizing profits), which is achieved by satisfying the interests of multiple corporate
stakeholders (not just shareholders).
30. The stakeholder model holds that the only social responsibility that businesses have is to maximize
profits.
31. Stakeholders are people or groups with a legitimate interest in a company’s actions.
32. According to the stakeholder model of social responsibility, no stakeholder groups are more or less
important than any other.
33. The two categories of stakeholder groups are internal stakeholders and external stakeholders.
34. The media would be an example of a secondary stakeholder group for an organization.
35. A corporation exists to create wealth for shareholders, managers, employees, suppliers, and customers.
By dispersing wealth to these stakeholders the corporation allows them to go out into the world and
advance their values through religious, political, and social institutions. This corporation operates at
the ethical level of social responsibility.
36. The categories of social responsibility for a company are economic, legal, ethical, and discretionary.
37. All four areas of social responsibility for companies (economic, legal, ethical, and discretionary) share
equal importance in a company’s overall level of social responsibility.
38. Companies will always be considered unethical if they do not perform their discretionary
responsibilities.
39. A company using a reactive strategy to respond to demands for social responsibility will do less than
society expects.
40. A company using an accommodative strategy will admit responsibility for a problem but will do the
least required to meet society’s expectations.
41. With regard to the question, “Does it pay to be socially responsible?” research has clearly
demonstrated that there is no inherent relationship between social responsibility and economic
performance of a company.
MULTIPLE CHOICE
1. Which of the following statements about ethics is true?
a.
Acting ethically is always easier than any other form of action.
b.
Employees assume no risk when they conduct themselves ethically.
c.
Like other laws, ethics can be defined.
d.
If an act is legal, it must by definition be ethical.
e.
Ethics is the set of moral principles or values that defines right and wrong for a person or
group.
2. There is a recognized llama industry in the United States. The industry is recovering from a period in
which prearranged deals at auctions and other techniques were used to falsely inflate prices. In
addition, bad-tempered animals were sedated before being sold. Today its reputation is being built by
breeders who go the extra mile to make sure their customers are satisfied. The llama industry has
discovered that _____ is the way to create sales.
a.
creating channel conflict
b.
acting with discretionary responsibility
c.
acting ethically
d.
upholding the law
e.
becoming an ethical ombudsman
3. Which of the following is a recommendation for how managers can model and encourage ethical
behavior in employees?
a.
use resources only for company business
b.
handle information in a confidential and honest manner
c.
set reasonable rather than unreasonable goals
d.
create a reward system that does not reward unethical behavior
e.
all of these
4. In Atlanta, independent auditors are investigating claims the metropolitan area’s Boy Scout pack
leaders inflated local black membership numbers to 20,000 under instructions from top Boy Scout
officials. A civil rights leader contends there are no more than 500 blacks actively involved. Atlanta
Boy Scout officials are being accused of:
a.
violating federal government policies
b.
demonstrating the “move it or lose it” syndrome
c.
engaging in unintentional unethical behavior
d.
acting as ethical ombudsmen
e.
acting as whistleblowers
5. __________ is unethical behavior that violates organizational norms about right and wrong.
a.
Workplace deviance
b.
Organizational deviance
c.
Social irresponsibility
d.
Social deviance
e.
An ethical dilemma
6. __________ is unethical behavior that hurts the quality and quantity of work produced.
a.
Political deviance
b.
Personal aggression
c.
Organizational irresponsibility
d.
TQM deviance
e.
Production deviance
7. __________ is unethical behavior aimed at the organization’s property or products.
a.
Political deviance
b.
Personal aggression
c.
Production deviance
d.
Property deviance
e.
Political aggression
8. Workplace deviance can be categorized by how deviant the behavior is and:
a.
how the behavior was motivated
b.
where the motivation occurred
c.
the target of the deviant behavior
d.
the intent of the violator
e.
organizational norms
9. Doug has a low-paying job for a telecommunications company. Every day when he goes home from
work, Doug puts a headset, a stapler, or something similar in his lunch box and takes it with him. Doug
sees nothing wrong with his behavior since he feels inadequately paid. Which of the following
describes Doug’s actions?
a.
Doug is engaged in production deviance.
b.
Doug is justified in his actions under the principle of distributive justice.
c.
Doug is engaged in sweethearting.
d.
Doug is engaged in property deviance.
e.
Doug is doing nothing unethical because he is not directly harming any person.
10. In terms of the types of workplace deviance, a serious infraction targeted at the organization, rather
than particular people in the workplace, would be categorized as:
a.
property deviance
b.
organizational irresponsibility
c.
cultural deviance
d.
personal aggression
e.
political deviance
11. Donald McNeese worked in the tax department of one of Prudential Insurance Company’s Florida
offices and was frustrated at what he felt was unfairly low pay. Federal prosecutors say he took out his
anger by stealing computerized personnel files for more than 60,000 company employees. McNeese
sold this information over the Internet. McNeese’s behavior was an example of:
a.
production deviance
b.
personal deviance
c.
political deviance
d.
organizational irresponsibility
e.
property deviance
12. According to a GAO report, the Department of Defense alone maintains an inventory of at least $100
billion in spare parts, clothing, medical supplies, and fuel. And even though the Defense Department
doesn’t classify pilferage as a major problem, its annual inventory shrinkage alone runs a billion or
two a year. This employee pilferage is an example of:
a.
production deviance
b.
personal aggression
c.
political deviance
d.
organizational irresponsibility
e.
property deviance
13. In violation of anti-kickback laws, some hospitals have begun asking hospice providers to perform
duties normally handled by discharge planners, according to health–care attorney Elizabeth Hogue. “If
providers agree to do these things, it would clearly be a kickback or a rebate in the form of free
services to a referral source,” Hogue said. The hospice providers could potentially be guilty of:
a.
production deviance
b.
personal aggression
c.
political deviance
d.
organizational irresponsibility
e.
property deviance
14. An individual who uses his or her influence to harm others in the company is engaged in:
a.
political deviance
b.
personal aggression
c.
production deviance
d.
property deviance
e.
organizational irresponsibility
15. Which of the following would be an example of political deviance?
a.
leaving early
b.
sabotaging equipment
c.
competing nonbeneficially
d.
sexual harassment
e.
accepting kickbacks
16. The Equal Employment Opportunity Commission reports that there has been a steady increase of
sexual harassment charges brought by men since 1992. This statement indicates the need to eliminate
______ in the workplace.
a.
production deviance
b.
personal aggression
c.
political deviance
d.
organizational irresponsibility
e.
property deviance
17. Spreading rumors about coworkers would be an example of:
a.
personal aggression
b.
production deviance
c.
property deviance
d.
political deviance
e.
formalized grapevine misuse
18. The __________ determined that companies can be prosecuted and punished for the illegal or
unethical actions of employees, even if management didn’t know about the unethical behavior.
a.
U.S. Sentencing Commission Guidelines
b.
U.S. Supreme Court
c.
U.S. Department of Labor
d.
U.S. Equal Employment Opportunity Commission
e.
Federal Trade Commission
19. Which of the following organizations are covered by the U.S. Sentencing Commission Guidelines?
a.
a manufacturer of barbecue grills
b.
a natural gas supplier
c.
a chain of movie theaters
d.
a grocery wholesaler
e.
all of these
20. If a catalog retailer promised customers it would not sell their information (addresses, phone numbers,
e-mail addresses, etc.) to another direct marketing company, and it did, the catalog retailer would be
found guilty of invasion of privacy under:
a.
the Internet Compliancy Act
b.
specific Supreme Court rulings
c.
the Federal Trade Act
d.
the Cellar-Kefauver Act of 1995
e.
the U.S. Sentencing Commission Guidelines
21. Margo and Kwesi went to college together and were sorority sisters. After graduation, Margo took a
managerial position in a medical research company. One month ago Margo hired Kwesi to work for
her. Today Kwesi has asked Margo for a week’s vacation even though employees are not permitted
vacations until they have been employed by the company for one full year. If Margo says, “Yes,” she
will be guilty of which kind of workplace deviance?
a.
production deviance
b.
personal aggression
c.
political deviance
d.
organizational irresponsibility
e.
relationship mismanagement
22. The U.S. Sentencing Commission Guidelines impose smaller fines on companies that:
a.
have never before violated ethics principles
b.
have already established a specific type of compliance program
c.
have already established an affirmative action program
d.
were unaware of the unethical behavior of employees
e.
have an ethics mentoring program
23. Video Arts Inc., a Chicago-based business training company, is currently marketing The Grapevine, a
30-minute training video designed to teach companies how to deal with and prevent damaging gossip.
The video is selling well due to growing concerns about:
a.
production deviance
b.
personal aggression
c.
political deviance
d.
organizational irresponsibility
e.
property deviance
24. According to the U.S. Sentencing Commission Guidelines, what is one method used to determine the
level of the offense (i.e., the seriousness of the problem)?
a.
by examining the personal codes of ethics of top managers of offending companies
b.
by examining the loss incurred by the victims
c.
by determining how much competitive advantage was created
d.
by looking at industry standards
e.
by doing all of these
25. What does it mean when the text says that the U.S. Sentencing Guidelines use a “carrot and stick”
approach?
a.
It’s a method of punishment similar to Halloween “trick or treat” practices.
b.
It rewards quick-responding reactive organizations.
c.
It offers lower fines to companies that take proactive steps.
d.
It asks companies not to emphasize just one area of ethical behavior.
e.
none of these
26. To create a compliance program that is acceptable under the U.S. Sentencing Guidelines, a company
should:
a.
establish standards and procedures to meet the company’s business needs
b.
put upper-level managers in charge of the compliance program
c.
encourage employees to report violations
d.
train employees on standards and procedures
e.
do all of these
27. When addressing issues of high __________, managers are more aware of the impact their decisions
have on others, they are more likely to view the decision as an ethical decision, and they are more
likely to worry about doing the right thing.
a.
social consensus
b.
ethical intensity
c.
temporal immediacy
d.
proximity of effect
e.
ethical temporality
28. What is the term used to describe the degree of concern people have about an ethical issue?
a.
Ethical intensity
b.
Social consensus
c.
Temporal immediacy
d.
Magnitude of consequences
e.
Ethical valence
29. Ethical intensity depends on all of the following EXCEPT:
a.
temporal immediacy
b.
probability of effect
c.
proximity of effect
d.
social consequences
e.
concentration of effect
30. Ethical intensity depends on:
a.
magnitude of dilemma
b.
social acceptance
c.
intent of the manager
d.
probability of synergy
e.
temporal immediacy
31. According to a GAO report, the Department of Defense alone maintains an inventory of at least $100
billion in spare parts, clothing, medical supplies, and fuel. And even though the Defense Department
doesn’t classify pilferage as a major problem, its annual inventory shrinkage alone runs a billion or
two a year. The intentional theft and sale of defense secrets would have greater ethical intensity than
this pilferage due to:
a.
magnitude of consequences
b.
magnitude of influence
c.
location immediacy
d.
probability of response
e.
all of these
32. IAG (Individualized Apparel Group) formally closed its H. Freeman factory in Philadelphia in May.
Jim Brubaker, IAG’s division president of clothing, informed the workers of this closing in April.
Due to _____, this decision produced strong ethical intensity.
a.
resource consequences
b.
magnitude of influence
c.
temporal immediacy
d.
probability of response
e.
all of these
33. In September 2006, a mid-air crash in Brazil killed 154 people. The accident was blamed primarily on
the nation’s air controllers, who are sometimes responsible for 20 or more aircraft at any one time.
(Fourteen is considered to be the safe limit.) The ethical decision to hire fewer air controllers than
safety guidelines dictate creates a high _____ for the airline industry.
a.
social consequence
b.
magnitude of consequences
c.
temporal immediacy
d.
probability of effect
e.
temporal dilemma
34. Due to _______, the intentional pollution of a metropolitan water supply would have greater ethical
intensity than insider trading in which a few participants netted less than $10,000.
a.
social consensus
b.
magnitude of consequences
c.
temporal immediacy
d.
probability of effect
e.
all of these
35. __________ is strong when decisions have large, certain, immediate consequences, and when we are
physically or psychologically close to those affected by the decision.
a.
Ethical variance
b.
The level of ethical involvement
c.
Ethical intensity
d.
Norm compliance
e.
Situational morality
36. Shell Oil Company’s plan to sink Brent Spar, an abandoned offshore oil-storage buoy, had a massive
effect on employee motivation and recruitment. The number of qualified people applying for jobs at
Shell plummeted, and many employees looked for positions in other companies. The plan caused
much greater harm than Shell’s managers had ever imagined it would. In other words, the plan had a
much greater __________ than predicted.
a.
synergistic effect
b.
impact proximity
c.
concentration of synergy
d.
magnitude of consequences
e.
temporal munificence
37. The three stages of moral development identified by Kohlberg are:
a.
amoral level, moral level, and post-moral level
b.
preconventional level, conventional level, and postconventional level
c.
introductory stage, growth stage, and maturity stage
d.
individual stage, organizational stage, and industry-wide stage
e.
unconventional level, preconventional level, and postconventional level
38. According to Kohlberg’s model of moral development, people at the __________ make decisions that
are based on selfish reasons.
a.
amoral level
b.
preconventional level
c.
conventional level
d.
postconventional level
e.
unconventional level
39. Doug has a low-paying job for a telecommunications company. Every day when he goes home from
work, Doug puts a headset, a stapler, or something similar in his lunch box and takes it with him. Doug
sees nothing wrong with his behavior since he feels inadequately paid. In terms of the stages of moral
development, Doug is operating at which level?
a.
conventional
b.
legally mandated
c.
preconventional
d.
postconventional
e.
internalization
40. According to Kohlberg’s model of moral development, people at the __________ make decisions that
conform to societal expectations.
a.
unconventional level
b.
preconventional level
c.
conventional level
d.
postconventional level
e.
amoral level
41. According to Kohlberg’s model of moral development, people at the __________ always use
internalized ethical principles to solve ethical dilemmas.
a.
amoral level
b.
preconventional level
c.
unconventional level
d.
postconventional level
e.
conventional level
42. Which of the following principles of ethical decision making would support the practice of “looking
after number one”?
a.
the principle of long-term self-interest
b.
the principle of personal virtue
c.
a discretionary code of ethics
d.
a utilitarian code of ethics
e.
the equity principle
43. Rotavirus is a gastrointestinal disease that causes only a few deaths in the U.S., but up to 500,000
deaths annually in developing countries. The vaccine for preventing the disease was proven to cause
an extremely rare but serious side effect, so its manufacturer stopped producing it. Which of the
following principles of ethical decision making could the pharmaceutical company use to justify its
actions?
a.
the principle of long-term self interest
b.
the principle of utilitarian requirements
c.
the principle of distributive justice
d.
the principle of community injunctions
e.
the principle of personal virtue
44. When Capri Ford became manager of the radio station’s marketing department, the retiring manager
told her, “Remember that if you conduct your business as if it were going to be broadcast as news on
this radio station, you’ll be true to yourself.” The retiring manager is promoting the principle of:
a.
long-term self-interest
b.
personal virtue
c.
religious injunctions
d.
utilitarian benefits
e.
government requirements
45. Traditional college students who think about their parents’ and grandparents’ reactions to their
decisions before putting the decision into action are more than likely operating according to which
principle of ethical decision making?
a.
the principle of long-term self-interest
b.
the principle of utilitarian requirements
c.
the principle of distributive justice
d.
the principle of community injunctions
e.
the principle of personal virtue
46. Funds for testing the Maxi Cube cargo handling system were written into the fiscal defense budget
during the final Senate-House Appropriations conference at the request of Rep. John Murtha of
Pennsylvania. The $10 million truck was to be manufactured in Murtha’s home district. The only
problem was that the U.S. Army had clearly said that it had “no known requirement” for the truck. In
response, Murtha used his position on the Appropriations Committee to freeze a series of military
budgeting requests until he got his pet project approved. Murtha was operating under the principle of:
a.
distributive equity
b.
long-term self-interest
c.
utilitarian benefits
d.
discretionary rights
e.
government requirements
47. Which of the following statements about the principles of ethical decision making is true?
a.
The ideal principle to follow if the principle of distributive justice.
b.
If the issue being decided has a high level of ethical intensity, it does not matter what
principle the decision maker uses.
c.
The ideal principle to follow is the principle of religious injunctions.
d.
Adherence to various principles of ethical decision making will give similar results.
e.
There is no ideal principle for ethical decision making.
48. Which of the following statements about the principles of ethical decision making is true?
a.
If the manager making the decision operates at the postconventional stage of moral
development, it will not matter what principle the decision maker uses.
b.
A manager acting under the principle of utilitarian benefits would not take an action that
would not result in greater good for society.
c.
A manager operating at the preconventional stage of morality development would most
likely use the principle of distributive justice.
d.
The principles of ethical decision making do not consider legality of the act when making
an ethical decision.
e.
All of these statements about the principles of ethical decision making are true.
49. Woodbury, NY-based East Side Entrees (ESE) provided Florida hurricane victims with nearly a half
million servings of aseptic milk for use in disaster areas that lost power. Because the cost of the
donation was offset by the greater good it did for its recipients, you can assume the principle of _____
guided the action of ESE.
a.
long-term self-interest
b.
personal virtue
c.
religious interests
d.
utilitarian benefits
e.
government requirements
50. British government-backed scientists announced their tests showed the ground water in Bangladesh
was safe to drink. Later, the World Health Organization revealed that the ground water supplies in
Bangladesh were actually contaminated with arsenic. If the British government admitted it was guilty
of harming Bangladesh because it funded the initial research, then its decision to help the country
would be an act of compassion and consistent with the principle of:
a.
distributive equity
b.
discretionary justice
c.
national rights
d.
religious injunctions
e.
government requirements
51. British government-backed scientists announced their tests showed the ground water in Bangladesh
was safe to drink. Later the World Health Organization revealed that the ground water supplies in
Bangladesh were actually contaminated with arsenic. The British government says it has no liability
even though it paid for the research. If the British government did admit guilt, it could be responsible
for the clean-up of the water and the treatment of people who have been poisoned. This process would
cost millions of dollars. By denying its guilt, the British government is doing what is best for the
British nation and its taxpayers. In other words, the British government is adhering to the principle of:
a.
distributive equity
b.
personal virtue
c.
utilitarian benefits
d.
discretionary rights
e.
government requirements
52. To encourage more ethical decision making in an organization, managers should:
a.
carefully select and hire new employees
b.
establish a specific code of ethics
c.
create an ethical climate
d.
train employees in how to make ethical decisions
e.
do all of these
53. A(n) ___________ is a written test that estimates employee honesty by directly asking job applicants
what they think or feel about theft or about punishment of unethical behaviors.
a.
situational-based integrity test
b.
personality-based integrity test
c.
direct integrity test
d.
framed integrity test
e.
overt integrity test
54. Managers can use integrity tests to:
a.
select and hire ethical employees
b.
force the use of the principle of distributive justice when dealing with customers
c.
differentiate primary and secondary stakeholders
d.
determine which principle of ethical decision making is most appropriate to the situation