114. A company implementing a(n) __________ strategy would choose to accept responsibility for a
problem and do all that society expects to solve problems.
a.
reactive
b.
defensive
c.
accommodative
d.
proactive
e.
connotative
115. A company implementing a(n) __________ strategy would demonstrate the greatest willingness on the
part of the company to meet or exceed society’s expectations.
a.
reactive
b.
defensive
c.
productive
d.
proactive
e.
accommodative
116. The Home Depot became a retailing giant by selling hammers, nails, and lumber at discount prices.
But then, the Rainforest Action Network launched a bruising PR campaign in 1997 to stop it from
selling old-growth lumber. After two years of bad publicity and resistance to new store locations,
Home Depot surrendered. Today, its suppliers are working with environmental and forestry groups to
certify that their wood products are not from endangered areas. Home Depot used a(n) __________
strategy to respond to demands that it be socially responsible.
a.
proactive
b.
accommodative
c.
predictive
d.
defensive
e.
offensive
117. IBM has a long-standing “Reinventing Education” program, which involves intensive research into
how educational institutions can use the fruits of new technologies to transform what they do and
thereby improve education. IBM is using a(n) __________ strategy to show its social responsibility.
a.
proactive
b.
accommodative
c.
predictive
d.
defensive
e.
adaptive
118. IBM has a long-standing “Reinventing Education” program, which involves intensive research into
how educational institutions can use the fruits of new technologies to transform what they do and
thereby improve education. In the process, the program is actually helping to shape a market of
significant interest to IBM. IBM views the program as an investment rather than as a charitable
contribution. This is an example of the positive relationship between social responsibility and:
a.
social consensus
b.
secondary shareholders
c.
economic performance
d.
covert stakeholders
e.
resource munificence
119. Which of the following statements about social responsibility and economic performance is true?
a.
Corporate reputation, strengthened by social responsibility, can positively affect economic
performance.
b.
Social responsibility guarantees profitability.
c.
Defensive, accommodative, and proactive strategies result in profitability and social
responsibility.
d.
There is a strong inherent relationship between social responsibility and economic
performance.
e.
All of these statements about social responsibility and economic performance are true.
120. A small manufacturer of scented candles has asked if acting socially responsible would increase its
profitability. What would you tell them?
a.
Yes. Look at the examples of Starbucks Coffee and Ben & Jerry’s.
b.
Yes. There is strong evidence of a positive relationship between social responsibility and
economic performance.
c.
No. Stakeholders do not support social responsibility if it lowers profits.
d.
Yes. An improved corporate reputation can have a positive impact on economic
performance.
e.
Yes. Economic performance improves as soon as a socially responsible strategy is
implemented.
The Fashion Industry
The Green Guide offers advice on green living, wearing organic materials, and preserving the
environment. In a report on clothing, the guide announced that many companies in the fashion industry
are paying attention to its message. The number one action point for consumers seeking an
environmentally-forward wardrobe is to “buy used clothing.” Trash Couture creates neo-luxury from
other people’s waste. The aptly named company gives a new life to vintage garments through
customized embellishments or dissected pieces re-applied to other recycled clothing. Noir, a
French-based fashion design company, uses only organic cotton grown on farms that it has established
in sub-Saharan Africa. The clothing industry is also moving towards greener marketing. American
Apparel, known for manufacturing all of its clothes in the United States recycles about 5 million
pounds of fabric scraps annually, uses solar panels to provide power, and gives free bicycles and
helmets to employees who wish to cycle to work. Increasingly, consumers are basing brand loyalty on
how companies interact with the natural environment.
121. Refer to The Fashion Industry. The fashion industry has discovered that _____ generates sales and
consumer satisfaction.
a.
creating channel conflict
b.
acting with discretionary responsibility
c.
acting ethically
d.
upholding the law
e.
becoming an ethical ombudsman
122. Refer to The Fashion Industry. According to the passage American Apparel uses a _________strategy
to social responsibility.
a.
proactive
b.
accommodative
c.
defensive
d.
reactive
e.
progressive
123. Refer to The Fashion Industry. The total harm or benefit derived from deciding what fabrics to use and
how and where the production will occur is referred to as the:
a.
synergistic effect
b.
impact proximity
c.
concentration of synergy
d.
magnitude of consequences
e.
temporal munificence
124. Refer to The Fashion Industry. Given our expanding awareness of global warming, decisions about
using pesticide-free fabrics have a growing degree of:
a.
ethical variance
b.
ethical involvement
c.
ethical intensity
d.
norm compliance
e.
situational morality
125. Refer to The Fashion Industry. The founders of Trash Couture were worried about pollution and had
internalized the belief that we should protect our natural environment whenever possible. At which
level of moral development were they operating?
a.
conventional
b.
legally mandated
c.
preconventional
d.
postconventional
e.
traditional
126. Refer to The Fashion Industry. Which of the following principles of ethical decision making most
likely governs the actions of companies like Noir and American Apparel?
a.
the principle of individual justice
b.
the principle of utilitarian benefits
c.
the principle of government rights
d.
the principle of reciprocal virtue
e.
the principle of short-term self-interest
127. Refer to The Fashion Industry. By offering pollution-free transportation to its employees, in addition
to its other actions to protect the environment, American Apparel is attempting to create a(n):
a.
ethical climate
b.
postconventional environment
c.
individually mandated ethical involvement
d.
system of utilitarian benefits
e.
system of reciprocal virtue
128. Refer to The Fashion Industry. By balancing the needs of consumers with the needs of the natural
environment, companies like Noir and Trash Couture are:
a.
acting with social consensus
b.
establishing economic responsibility
c.
relying on consumer munificence
d.
creating social proximity
e.
acting socially responsible
129. Refer to The Fashion Industry. Farmers in sub-Saharan Africa who grow organic cotton for Noir and
other companies in the fashion industry are examples of _____ stakeholders.
a.
primary
b.
secondary
c.
covert
d.
conventional
e.
reactive
P&G and PETA
People for the Ethical Treatment of Animals, the animal-rights group more commonly known as
PETA, is extremely adept at organizing campaigns and mobilizing the public to boycott companies. Its
public relations tactics include celebrity endorsements, traveling displays of animal cruelty, and on-site
demonstrations. So, when PETA began its “Died” campaign, targeting Procter & Gamble for animal
testing practices, P&G management became legitimately concerned.
PETA has been known to use pretty crude tactics to get its point across. For instance, PETA
successfully launched a six-year campaign of intimidation against a farm that bread guinea pigs for
scientific research, with strategies including hate mail, malicious phone calls, death threats, arson, car
vandalism, and a pedophile smear campaign. Clearly PETA will do anything to achieve its goals. Even
large international companies like McDonald’s, Burger King, and KFC have responded to pressure
from PETA by issuing and enforcing strict animal handling guidelines to their meat suppliers. The
“Died” campaign against P&G, based on P&G’s Tide laundry detergent, shows a woman holding a
box of “Died” detergent with the words “Thousands of Animals Died for Your Laundry.” PETA has
encouraged consumers to boycott all P&G products until the company ends all forms of animal testing.
Companies like P&G have both an ethical and legal obligation to ensure the safety of their
products for consumer use and consumption. Many such companies, including P&G, have invested
heavily in exploring alternatives to using animals for product safety testing; however, these
technologies are not sophisticated enough to completely replace animal testing. Consequently, entirely
eliminating animal testing would be imprudent and negligent. P&G continues to use animal testing but
only when absolutely necessary.
Though groups like PETA have an influence over P&G’s practices, their interactions with the
company are limited and irregular. P&G’s primary responsibilities lie with groups like shareholders,
customers, and employees. The potential threats and damages to the company such as lawsuits and
unsafe products that might result from the elimination of animal testing would have a much greater
effect on customer confidence, shareholder stakes, and employee job security.
With regards to PETA, legally all P&G would have to do is make sure that no animal abuse occurs
in its product testing. It is already doing this, and in fact is going further, by exploring ways to further
eliminate the need for animal testing. In addition to its own programs, P&G also funds independent
agencies and institutions that are experimenting with alternative approaches.
130. Refer to P&G and PETA. PETA more than likely sees greater _____ than P&G’s research and
development department when making decisions involving animals.
a.
ethical intensity
b.
social consensus
c.
temporal immediacy
d.
ethical congruence
e.
ethical valence
131. Refer to P&G and PETA. PETA apparently expects all for-profit organizations to adhere to the:
a.
principle of long-term self interest
b.
principle of utilitarian requirements
c.
principle of distributive justice
d.
principle of community injunctions
e.
principle of personal virtue
132. Refer to P&G and PETA. Like many organizations trying to act more ethically, what should P&G’s
first step be as it adopts more ethical decision-making practices concerning animal testing?
a.
to select and hire ethical employees
b.
to establish a visionary code of ethics
c.
to create an ethical ombudsman program
d.
to develop individual ethics codes for its employees
e.
to do all of these
133. Refer to P&G and PETA. By ensuring that no animals are abused during the testing of its products
while also making sure that its products are safe for human use, P&G is acting:
a.
according to social consensus
b.
with social munificence
c.
ethically diverse
d.
socially responsible
e.
with social proximity
SHORT ANSWER
1. What is ethical behavior? Briefly comment on its implications for conducting business internationally.
2. Explain the importance of ethics to the performance of a manager’s job. Provide three examples of
tactics a manager can use to encourage employees to behave ethically.
ANS:
3. Discuss employee shrinkage as a type of workplace deviance.
4. What is workplace deviance? List and briefly identify the four categories of behavior that comprise
workplace deviance.
5. Why should companies establish compliance programs under the U.S. Sentencing Commission
Guidelines?
6. List four of the seven requirements for an effective compliance program as established under the U.S.
Sentencing Commission Guidelines.
ANS:
7. List the three factors that influence ethical decision making. How do education and training influence
these three factors and, thus, improve ethical decision making?
8. Identify and briefly describe Kohlberg’s three phases of moral development.
9. List and briefly define four principles of ethical decision making that can be used by managers to solve
ethical problems.
ANS:
10. What are the four steps managers can take to encourage more ethical decision making in their
organizations?
11. What are the four steps managers must follow to create an ethical business climate?
12. Define stakeholders. What are the two types of stakeholder groups? Give one example of each.
13. List and briefly describe the four areas of corporate social responsibility that are most relevant to
stakeholders.
ESSAY
1. Define ethics and ethical behavior. List the major ways in which managers can promote ethics in their
workplaces. Explain the role of managerial intentions in this process of promoting ethical behavior.
2. What is workplace deviance? List and briefly define the four types of workplace deviance. Give an
example of workplace deviance that you have personally observed in a work situation, and explain
which category it exemplifies.
ANS:
3. Irving has just been notified that he will be among the employees who are laid off in his company’s
recently announced 10 percent reduction in force, necessitated by a dramatic drop in profits. When he
asked his supervisor why he was being laid off, rather than other individuals in his work unit, his
supervisor referred to Irving’s performance appraisals for the past 3 years. Those appraisals
documented numerous problems with Irving’s performance, including leaving early and taking
excessive breaks, gossiping about coworkers, and blaming them for his mistakes, as well as bullying
and verbally abusing coworkers. The supervisor pointed out that all of the other individuals in the unit
had good performance appraisals with none of the problems manifested by Irving. Irving responded by
saying, “Everybody has a bad day—that shouldn’t be held against me. I’ve never stolen anything from
the company, and I really need my job. You’re not treating me fairly in this situation!” Discuss a
possible management rationale for Irving’s dismissal in terms of the concepts of workplace deviance
and social responsibility.
ANS:
4. List and explain the three factors that influence ethical decisions. How does each of the factors
influence how managers make ethical decisions in their work?
ANS:
5. Discuss the nature and value of integrity testing to management as a tool in encouraging ethical
decision making in their organizations.
6. What is social responsiveness? Identify the four strategies that can be used to respond to social
responsibility problems. What is the common dimension on which these strategies differ? Use the
relationship between social responsibility and economic performance to explain why a company might
choose one strategy over another in a given set of circumstances.