Business & Society, 16e (Lawrence)
Chapter 6 Organizational Ethics
1) Personal values and moral character play key roles in improving a company’s ethical
performance.
2) In most companies, a moral atmosphere cannot be detected.
3) In a benevolence ethical climate, the interests of the company’s employees and external
stakeholders most likely would be given high priority.
4) Managers, as major decision-makers, are one of the keys to whether a company will act
ethically or unethically.
5) It is impossible for multiple ethical climates to exist within one organization.
6) The Principles and Standards of Ethical Supply Chain Management Conduct focuses on
integrity, value, and loyalty.
7) Honesty, integrity, and accuracy are absolute requirements of the accounting function.
8) The American Institute of Certified Public Accountants Code directs accountants to be steadfast
in honorable behavior, but not to the point of personal sacrifice.
9) Marketing ethics include having concern for consumer health and safety issues.
10) The majority of large U.S. corporations do not have codes of ethics.
11) In the United States, most ethics policies are based primarily on the company’s mission and
vision.
12) Ethics training is typically the most costly element of an ethics program.
13) Today, more companies than ever are turning to formal ethics audits to measure the quality of
their ethics programs.
14) According to a recent Transparency International survey, Denmark and New Zealand are two
countries that are least likely to be subjected to bribery.
15) Bribery is found in nearly every sector of the global marketplace, but can be worse in some
parts of the world.
16) The core components upon which a company’s ethical performance depends include:
A) The values and virtues of the managers.
B) The personal character of the managers and employees.
C) The traditions, attitudes, and business practices built into a company’s culture.
D) All of these answers are correct.
17) The unspoken understanding among employees of what is and is not acceptable behavior is
called:
A) Ethical climate.
B) Corporate image.
C) Ethical relativism.
D) Rites and rituals.
18) Which of the following is not an example of an ethical criterion?
A) Egoism.
B) Concern for others.
C) Principle.
D) Corporate driven.
19) If a manager approaches ethics with benevolence in mind, he or she would stress what?
A) Friendly relations with an employee.
B) Company rules and procedures.
C) Laws and professional codes.
D) Economic efficiency.
20) Which ethical criterion is described by the idea that a company should strive for efficiency?
A) Egoism.
B) Benevolence.
C) Principle.
D) Business-centered.
21) By law, the financial records of publicly held companies are required to be:
A) Managed by an accounting department of at least five CPAs.
B) Summarized in the employee manual for new hires.
C) Reviewed quarterly by the IRS.
D) Audited by a certified professional accounting firm.
22) All of the following are commitments of the Principles of the Code of Professional Conduct of
the American Institute of Certified Public Accountants except:
A) The Public Interest.
B) Objectivity and Independence.
C) Due Process.
D) Due Care.
23) A member of the Chartered Financial Analyst Institute (CFA) must:
A) Promote the integrity of and uphold the rules governing global capital markets.
B) Act with integrity, competence, diligence, respect, and in an ethical manner with the public.
C) Maintain and improve their professional competence.
D) All of these answers are correct.
24) All of the following are considered to be ethical issues for marketing professionals except:
A) Fostering trust in the marketing system.
B) Embracing ethical values.
C) Doing no harm.
D) Ignoring market fair dealing.
25) Ethical challenges for information technology employees include:
A) Data privacy.
B) Laptop speed.
C) Copyright protection.
D) Data privacy and copyright protection.
26) The Principles and Standards of Ethical Supply Chain Management Conduct includes the
principle:
A) Protect confidentiality.
B) Promote competitive relationships with suppliers.
C) Be true to yourself.
D) Social competence.
27) When attempting to build ethical safeguards into the company, businesses can take the
following specific approaches:
A) Institutional and Legal.
B) Legal and Practical.
C) Compliance and Integrity.
D) Value-based and Consequentialism.
28) Building ethical safeguards into a company’s everyday routines is called:
A) Change management.
B) Justifying ethics.
C) Institutionalizing ethics.
D) Ethical awareness.
29) A company that channels employee behavior in a lawful direction by emphasizing the threat of
detection and punishment is:
A) Operating under the compliance-based approach.
B) Practicing “tone at the top.”
C) Operating under the integrity-based approach.
D) Operating under the instrumental policy approach.
30) Integrity-based ethics programs:
A) Seek to avoid legal sanctions
B) Combine concern for the law with an emphasis on employee responsibility.
C) Threaten employees with punishment for noncompliance with the ethics program.
D) Are predominately implemented within the European Union.
31) A giant step is taken toward improving ethical performance throughout the company when:
A) The firm hires a university ethics professor to lecture employees on moral philosophy.
B) The Justice Department launches an investigation of the firm’s pricing practices.
C) Senior-level managers signal to employees that they believe ethics is a high priority.
D) A consumer hot line is created and staffed 24 hours a day.
32) Business managers need a set of ethical guidelines to help them:
A) Understand the changing customs throughout the world.
B) Justify the resolution which best helps them.
C) Identify and analyze the nature of the ethical problem.
D) None of these answers is correct.
33) Ethics policies typically cover all of the following issues except:
A) Developing guidelines for accepting or refusing gifts from suppliers.
B) Encouraging discriminatory personnel practices.
C) Avoiding conflict of interest.
D) Maintaining the security of proprietary information.
34) Most ethics or compliance officers are entrusted to:
A) Act as a liaison between the company and their temporary employees.
B) Reduce the risks to the company of employee misconduct.
C) Audit the company’s financial records.
D) Arrange customer training courses at a nearby university.
35) The most effective ethics programs utilize which of the following?
A) Written policy.
B) Posters.
C) Quick reference guides.
D) All of these answers are correct.
36) Which type of employee is most likely to report ethical issues in the workplace?
A) Rank and file.
B) Middle managers.
C) Executives.
D) Part-time workers.
37) The critical component in installing an effective ethics program is:
A) To allow all employees the freedom to act as they wish.
B) In hiring an expensive ethics consultant.
C) The integration of various ethics safeguards into a comprehensive program.
D) Maintaining the position as the industry sales leader.
38) Which company ethics safeguard is commonly implemented as an employee “helpline”?
A) Top management commitment.
B) Code of ethics.
C) Reporting mechanisms.
D) Compliance tracking.
39) Which of these components are not considered during a risk-assessment audit to gauge the
effectiveness of a firm’s ethics programs?
A) The financial bottom line.
B) Top management commitment.
C) Training programs.
D) Ethical policies.
40) A company that has ranked amongst the most ethical firms from 2007 to 2017, according to
Forbes magazine, is:
A) Amazon.com
B) Walmart
C) AFLAC
D) Equifax
41) Which U.S. Act prohibits executives representing U.S.-based companies from paying bribes to
foreign government officials, political parties, or political candidates?
A) The USA Patriot Act.
B) The UK Bribery Act.
C) The Corruption of Foreign Officials Act.
D) The U.S. Foreign Corrupt Practices Act.
42) Which of these statements is true about the U.K. Bribery Act?
A) Provides an exemption for “facilitating payments.”
B) Contains a strict liability offense for failure to prevent bribery by commercial organizations.
C) Prohibits bribery only for government officials.
D) Requires that improper actions be made “corruptly.”
43) Which country passed major anti-corruption reforms in 2016?
A) Russia.
B) Mexico.
C) Brazil.
D) India.
44) In the case Equifax’s Data Breach, which ethical climate dominated during the data breach?
A) Benevolence.
B) Integrity.
C) Egoism.
D) Team approach.
45) Define ethical climate. Discuss the differences and similarities among the ethical climates
outlined in the textbook.
46) Provide examples of role model companies and what efforts they took to develop effective
ethics programs.
47) Not all ethics issues in business are the same. Discuss the distinct ethical issues across three
different organizational functions. Highlight details of the professional codes of conduct for each.
48) Construct a comprehensive ethics program using four of the five ethical safeguards identified
in the textbook.
49) Discuss the importance of ethics training at different levels of an organization. Is it more
important for managers to receive ethical training? Why or why not?
50) Explain the criteria used to assess the results of a corporate ethics program.
51) Define bribery. Explain why certain countries are less likely to participate in such acts.