Ethical Relativism refers to the gray area in which ethical principles are defined by the
traditions of society, personal opinions, and the circumstances of the present moment.
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The human resource function within an organization should ideally be directly involved
in the creation of a career development program for the employee.
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The problem with utilitarianism is the focus on doing the most good for a select few,
such as Adolf Hitler and his idea of launching a national genocide against Jews on the
ethical grounds of restoring the Aryan race.
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In the guidelines he set down for organizations doing business in other countries,
Richard DeGeorge stated that it was acceptable for a company to harm the host country
only if it served the greatest good for the greatest number of people.
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The extranet is a part of a company’s website which can only be accessed by its senior
executives.
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Corporate Social Responsibility (CSR) refers to the actions of an organization that are
targeted toward achieving a social benefit over and above maximizing profits for its
shareholders and meeting all its legal obligations.
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The term “globalization” refers to the phenomenon that divided the world into two
opposing factions during the Cold War.
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The main responsibility of the compensation committee is to set the compensation for
all the employees of the organization, including its outside contractors.
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With the transition to an information-based economy, consumers and investors have
more information at their disposal than at any time in history.
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There are four distinctive types of corporate social responsibility (CSR)economic,
ethical, altruistic, and strategic.
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When an individual is looking to manage the reputation and policies of an organization,
the commitment to doing the right thing becomes more about written ethics policy than
any sense of organizational integrity.
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Some of the illegal financial functions include underreporting income, overvaluing
assets, and taking questionable deductions.
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The Ethics and Compliance Officers Association is a professional group of ethics and
compliance officers with over 1,000 members.
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Marketing, sales, and customer service are identified as key functions in a value chain.
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The advocates of ethical business conduct argue that HR should be at the center of any
corporate code of ethics.
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The basic assumption of ethical theory is that you as an individual or community are in
control of all the factors that influence the choices that you make.
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The culpability score, according to the Federal Sentencing Guidelines for
Organizations, is the calculation of the organization’s degree of blame or guilt and is a
multiplier of the base fine up to 40 times.
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The argument in favor of merging the roles of the chairperson of the board and the chief
executive officer is one of efficiency.
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According to the Federal Sentencing Guidelines for Organizations, criminal offenses,
whether actual or suspected, must generate an appropriate response, analysis, and
corrective action in order to establish an effective compliance program.
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Under no circumstances can the culpability score be increased or decreased.
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The role of an ethics officer is to enforce the code of ethics and provide support to any
employees who witness unethical behavior.
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Hiring an ethics officer is the first stage in the process of making ethical behavior
sustainable.
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Business ethics involves the application of standards of moral behavior to business
situations.
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An intrinsic value means that the pursuit of one value is a good way to reach another
value.
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The categories of litigation for cyberliability extend to defamation and libel.
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The problem with ethics for the greater good is the idea that the ends justify the means.
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Codes of ethics have matured from performance-measurement documents into cosmetic
public relations documents.
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The abbreviation “qui tam” establishes a whistle-blower as a deputized petitioner for the
government in cases that expose fraudulent behavior of companies.
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The intranet is a private piece of a company’s Internet network that is made available to
customers and/or vendor partners on the basis of secured access by a unique password.
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The Whistleblower Protection Act of 1989 first addressed the issue of retaliation against
corporate employees who bring accusations of unethical behavior.
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When creating a code of ethics from scratch, the Institute of Business Ethics suggests
that an organization should create an original model rather than picking a well-tested
model.
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The strategic business unit of an organization is responsible for monitoring the financial
policies and procedures of the organization.
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The social contract approach to corporate management is the perspective that the only
obligation of a corporation is to maximize profits for its shareholders in providing
goods and services that meet the needs of its customers.
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The concept of universal ethics argues that there are certain principles that should apply
to a select few ethical judgments.
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Globalization refers to the expansion of international trade to a point where, across the
globe, regional trade blocs have overtaken national markets.
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Ethical dilemmas are the study of how ethical theories are put into practice.
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U.S. citizens consider the public sector as the most appropriate venue for addressing a
growing list of social problems.
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The difference between intrinsic value and instrumental value is that:
A. intrinsic value refers to the adoption of those standards that are ultimately unique to
a society.
B. instrumental value refers to the quality by which the pursuit of one value is a good
way to reach another value.
C. instrumental value refers to the quality by which a value is a good thing in itself and
is pursued for its own sake, whether anything comes from that pursuit or not.
D. intrinsic value refers to values acquired through media and religion.
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The study of how ethical theories are put into practice refers to _____.
A. meta-ethics
B. normative ethics
C. descriptive ethics
D. applied ethics
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Organizations pursuing a clearly defined sense of social conscience in managing their
financial responsibilities to shareholders, their legal responsibilities to their local
community and society as a whole, and their ethical responsibilities to do the right thing
for all their stakeholders follow a(n) _____ initiative.
A. altruistic CSR
B. strategic CSR
C. ethical CSR
D. economic CSR
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The _____ proposed that there should be a key restriction in the legislation to limit the
ability of banks to trade on their own accounts (termed proprietary trading).
A. Sarbanes-Oxley Act
B. Volcker rule
C. Campbell’s rule
D. Foreign Corrupt Practices Act
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Payments that are acceptable (legal) provided they expedite or secure the performance
of a routine governmental action are called _____.
A. facilitation payments
B. accentuation payments
C. flood payments
D. insulation payments
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Ken reported misconduct in his organization to the Securities and Exchange
Commission. He was able to provide substantial evidence and won the case. The
amount recovered was over $1 billion. Which of the following laws states that Ken is
eligible to receive between 10 and 30% of the monies collected?
A. The Corporate and Criminal Fraud Accountability Act
B. The Rehabilitation Act
C. The National Emergencies Act
D. The Dodd-Frank Wall Street Reform and Protection Act
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Emily, a website designer, is hired by an organization to create an internal website that
contains information meant to be accessed solely by employees. This website is the
company’s _____.
A. cybernet
B. intranet
C. Ethernet
D. extranet
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Which of the following is TRUE of the Sarbanes-Oxley Act (SOX)?
A. It helped disband the Public Company Accounting Oversight Board.
B. It protects employees of companies who provide evidence of fraud.
C. It prohibits a CEO from signing the company’s federal income tax return.
D. It considers whistle-blowing a white collar crime.
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Which of the following is TRUE of the “comply or explain” approach to corporate
governance?
A. It set stiff financial penalties for companies that refused to abide by its operational
standards.
B. It gave companies the flexibility to comply with its governance standards or justify
why they didn’t in their corporate documents.
C. It was extremely explicit when it came to defining what would be acceptable
explanations for noncompliance.
D. It proved to be an effective deterrent to financial scandals and reduced the incidence
of unethical behavior in corporations.
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Why was the Foreign Corrupt Practices Act criticized?
A. The act does not require full disclosure of funds that were taken out of or brought
into the United States.
B. The act does not address the illegality of using the U.S. mail or wire communications
to transact a fraudulent scheme.
C. The act requires corporations to fully disclose all transactions conducted with foreign
officials in line with the SEC provisions.
D. The act formally recognizes the facilitation payments, which would otherwise be
acknowledged as bribes.
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The research and development (R&D) department of an organization:
A. is solely responsible for creating employees’ career development programs.
B. has a minute impact on the success of the organization.
C. carries the responsibility for the future growth of the organization.
D. is the most important department of the organization.
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Which of the following is one of the key pieces of U.S. legislation designed to
discourage, if not prevent, illegal conduct within businesses?
A. The U.S. Federal Sentencing Guidelines for Organizations
B. The Pendleton Civil Service Reform Act
C. The District of Columbia Retrocession
D. The National Emergencies Act
Answer:
In addition to achieving social benefits, which of the following best illustrates that a
company is effectively implementing corporate social responsibility (CSR)?
A. The company provides its employees free lunch
B. The company allows flexible working hours for its employees
C. The company gives better pricing deals to older clients
D. The company fulfills its legal obligations
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The first step in the three-step process for solving an ethical problem is to:
A. analyze the consequences.
B. make a plan.
C. make a decision.
D. analyze the actions.
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The Foreign Corrupt Practices Act:
A. is jointly enforced by the Federal Bureau of Investigation and the Ministry of
Internal Affairs.
B. encompasses all the measures that were previously in use to curb unethical overseas
transactions.
C. replaced the Dodd-Frank Wall Street Reform and Consumer Protection Act.
D. ignores stipulations laid down by the Bank Secrecy Act and the Mail Fraud Act.
Answer:
Sebastian and Amy are arguing over secondary legislations that were in place prior to
the passing of the Foreign Corrupt Practices Act (FCPA). Amy is of the opinion that the
FCPA encompasses all secondary measures that were in use to prohibit corrupt
practices. Sebastian disagrees with Amy on this point. Which of the following, ifTRUE,
would strengthen Amy’s argument?
A. The FCPA requires only partial disclosure of funds that were taken out of or brought
into the United States.
B. The FCPA does not specify that using wire communications to transact fraudulent
schemes is illegal.
C. The FCPA requires corporations to fully disclose all transactions conducted with
foreign officials in line with the SEC provisions.
D. The FCPA does not fine companies for failing to disclose payments made to foreign
officials under its securities rules.
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Why was the “comply or explain” approach to corporate governance problematic?
A. It was too strict and fined corporations that did not conform to its standards heavily.
B. It did not permit corporations to express why they chose not to comply with certain
rules.
C. Its definition of what constitutes an acceptable explanation for not complying was
vague.
D. It expected corporations to abide by an extremely rigid set of operating standards.
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Bector Airlines supports relief camps in the Republic of Cadmia with donations of both
money and employee-donated volunteer hours. It also provides packaged food in times
of natural crises such as hurricanes, earthquakes, etc. This is an example of _____ CSR.
A. strategic
B. economic
C. altruistic
D. ethical
Answer:
In what way has globalization affected the economy?
A. Transnational markets have given way to national markets.
B. Regional trade blocs have been replaced by domestic markets.
C. National markets are becoming less dependent on each other.
D. National markets are being overtaken by regional trade blocs.
Answer:
A commitment to good corporate governance:
A. necessitates decreasing the independence of the board.
B. often affects a company’s public image adversely.
C. means adopting the “comply or explain” approach.
D. makes a company more attractive to investors.
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The inside members of a company’s board of directors:
A. typically have no direct connection with the company.
B. hold managerial positions within the company.
C. comprise the company’s creditors and suppliers.
D. include the external consultants used by the company.
Answer:
_____ in business means that stakeholders have visibility deep into the processes and
information of an organization.
A. Transparency
B. Conformity
C. Vicarious liability
D. Organizational integrity
Answer:
The fiduciary responsibility of a manager is ultimately based on _____.
A. educational background
B. experience
C. charisma
D. trust
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Which of the following is TRUE of the CRAFTED principles of governance?
A. It recommends creating a culture of consistency, accountability, and responsibility.
B. It considers only the financial profitability of all operational actions.
C. It favors a tight information flow managed by a company’s senior executive leaders.
D. It approves of selecting members of the board by trading professional favors.
Answer:
Which of the following companies implements Milton Friedman’s view of the corporate
world?
A. A company that donates a certain portion of profit to an organization for
underprivileged children.
B. A company that makes as much profit as possible to ensure that the investments
made by the company are successful.
C. A company that stipulates that profits should be earned at any cost, be it deception or
fraud.
D. A company that believes its social responsibility is beyond serving the interests of its
stockholders.
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_____ is ethical behavior that persists long after the latest public scandal or the latest
management buzzword.
A. Universal ethics
B. Sustainable ethics
C. Virtue ethics
D. Applied ethics
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The False Claims Act was strengthened in 1986 to:
A. deter whistle-blowers from speaking up by penalizing them.
B. protect non-federal employees from corporate retaliation.
C. reject evidence provided by nonfederal whistle-blowers.
D. make it easier and safer for whistle-blowers to come forward.
Answer:
Aragon Enterprises (AE) and Brenner Inc. (BI) are formulating their company’s ethics
policy with the goal of increasing employee loyalty and improving customer
satisfaction. In order to meet these goals, AE and BI should ensure that:
A. the policy includes threats of punishments balanced with rewards.
B. the policy avoids making promises for rewards to employees.
C. the policy solely includes the internal stakeholders.
D. the policy avoids celebrating particular instances of good ethical behavior.
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The difference between reactive and proactive policies is that:
A. unlike reactive policies, proactive policies ignore the actions the firm will most
likely take to be recognized as an ethical organization.
B. reactive policies are driven by events and/or a fear of future events, whereas
proactive policies are driven by a clear sense of what is construed as ethical for the
organization.
C. proactive policies help monitor the ethical performance of the organization only
externally, whereas reactive policies monitor the organization both internally and
externally.
D. unlike proactive policies, reactive policies are TRUE ethical policies.
Answer:
Which of the following serves as a support line function to key functional areas in an
organization’s value chain?
A. Advertising
B. Manufacturing
C. Human resources management
D. Distribution
Answer:
The Sarbanes-Oxley Act of 2002 is also known as:
A. Lincoln’s Law.
B. Miranda Law.
C. the Dodd-Frank Wall Street Reform and Protection Act.
D. the Corporate and Criminal Fraud Accountability Act.
Answer:
Merging the roles of the chief executive officer and the chairperson of the board of an
organization is advantageous because:
A. the power of the stockholders and the independence of the board is increased.
B. the company begins to prioritize long-term goals over short-term goals.
C. the checks that the board set in place against unethical behavior become more
effective.
D. the board is led by someone familiar with the inner workings of the organization.
Answer:
Which of the following will most likely influence the moral standards of an individual?
A. Change of government in the individual’s home country
B. A strict family upbringing
C. Attitude of people in the neighboring country
D. An opportunity to learn a foreign language
Answer:
Hoffmann Enterprises (HE), a manufacturer of industrial goods, primarily focuses on
meeting the demands of the market with quality products. It also undertakes
environmental protection endeavors that promote the use of renewable sources of
energy. HE illustrates the _____ to corporate management.
A. free-enterprise approach
B. instrumental approach
C. shareholder approach
D. social contract approach
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Explain the employers’ perspective on monitoring employees’ activity at the workplace.
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How has globalization affected the economic market?
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_____ corporate social responsibility (CSR) encompasses philanthropic activities
targeted toward programs that generate the most positive publicity or goodwill for the
organization.
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A _____ is a telephone line by which employees can leave messages to alert a company
of suspected misconduct without revealing their identity.
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The _____ calls on enterprises to respect both the letter and spirit of tax laws and to
cooperate with tax authorities.
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The _____ is a company’s written standards of ethical behavior that are designed to
guide managers and employees in making the decisions and choices they face every
day.
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The focus of the _____ report was on internal governance.
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_____ instrumental contract argues that corporations carry no moral obligation to the
countries in which they operate beyond abiding by their laws.
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The corporate governance committee oversees compliance with the company’s internal
_____ as well as any federal and state regulations on corporate conduct.
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_____ of the Sarbanes-Oxley Act focuses on issues related to auditor independence.
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The UN Global Compact is a voluntary corporate citizenship initiative endorsing 10
key principles that focus on four main areas of concern: the _____, anticorruption, the
welfare of workers around the world, and global human rights.
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The _____ is a government agency established to prevent banks from failing and
otherwise threatening the stability of the U.S. economy.
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The idea of _____ implies some degree of flexibility as opposed to strict
black-and-white rules.
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The _____ report formally recognized the need to move the stakeholder model forward
and consider a triple bottom line as opposed to the traditional single bottom line of
profitability.
Answer:
According to the _____, a company’s code of ethics should be a central guide to support
day-to-day decision making at work.
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_____ corporate social responsibility (CSR) runs the greatest risk of being perceived as
self-serving behavior on the part of the organization.
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_____ can be employed to capture every key pressed on a computer keyboard.
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The _____ is the line function that maintains the technology backbone of the
organizationdata transfer and security, e-mail communications, internal and external
websites, as well as the individual hardware and software needs that are specific to the
organization and its line of business.
Answer:
Kohlberg’s framework offers us a clearer view into the process of ethical _____.
Answer:
Because of globalization, _____ have overtaken national markets, leading to a global
marketplace.
Answer:
