Question-1
A number of employees at Sports Plus Inc., which is headquartered in a country where masculinity and power distance are high, do not behave in an ethical manner. In this context, the roots of unethical behavior can be traced to
- the legal environment.
- the organizational culture.
- the societal culture.
- unrealistic performance goals.
- the company’s leadership.
Question-2
If Kendra was working in the home office in Ohio she never would have agreed to pay the government official to speed up the delivery of the cargo; but since she is working in the company’s foreign office, she agrees to the practice since it is considered normal in this country. Which philosophical approach to ethics is Kendra using to make her decision?
- Friedman doctrine
- Righteous moralism
- Cultural relativism
- Naive immoralism
- Kantian approach
Question-3
Ethics in the Workplace
Business ethics are not divorced from personal ethics, which are generally accepted principles of right and wrong governing the conduct of individuals. Our personal ethical code exerts a profound influence on the way we behave as business people. Why do managers behave in an unethical manner? There is no simple answer to this question, for the causes are complex, but some generalizations can be made.
Many managers have made poor ethical decisions while engaged in international business. Many of these ethical issues are rooted in the variations among nations in their political systems, law, economic development, and culture. What is considered normal practice in one nation may be considered unethical in another.
Select the most appropriate determinant of ethical behavior for each hypothetical company situation.
- Joe regularly visits China and offers lavish gifts to the Chinese company officials who are customers of his U.S. software company. He does this in order to secure his yearly sales quota bonus, and writes off the gifts as a business expense to his company.
- Company ABC employees are pleasantly surprised by the way motivation and initiatives are being recognized after they were acquired by Company EFG.
- Company “X” has an evaluation system in place that eliminates 20 percent of underperformers every six months.
- Unrealistic performance expectations
- Jack is the CEO of a large corporation. Due to the global economic crisis, he has frozen wages, disallowed employee travel, and cancelled the annual holiday party. Last week he skied at Vail, a posh resort, with his wife, and charged all of his expenses to the company under the pretense that he was “meeting with local legislators.”
- Ellen has taken over a troubled manufacturing plant. The citizens who live around the plant are concerned about safety and pollution. She sets up a community meeting so that managers, organized labor, affected citizens, and all other parties can air their concerns as a step toward addressing the simmering issues.
Question-4
The two caveats of the Sullivan principles are first, a company should not obey the apartheid laws in its own South African operations and second, a company should
- do everything possible to abolish apartheid laws.
- provide facilitating payments to foster the apartheid movement.
- not add to the tragedy of the commons.
- limit toxic emissions and control environmental pollutants.
- return production facilities to the home country.
Question-5
During the second stage of the ethical decision-making process, managers must determine whether a proposed decision would violate
- a righteous distribution.
- home country values.
- the fundamental rights of any stakeholders.
- utilitarian beliefs.
- the global commons.
Corporate Social Responsibility
This activity is important because as a manager, it is important to recognize the need to incorporate ethical considerations into decision making. Many consider benevolent behavior to be a responsibility of successful companies. Some managers believe they have a moral obligation to use their power to give back.
The goal of this exercise is to demonstrate your understanding of corporate social responsibility and why it is important for companies to improve the welfare of the communities in which they operate.
Question-6
- The concept of socially responsible behavior by U.S. corporations
- began after the Enron crisis when companies needed to improve their reputations.
- was developed in response to the financial crisis of 2008.
- emerged as way to help stabilize the country after World War II.
- was part of the Corporate Reform Act.
- dates back to the late 1700s.
Question-7
The idea that business people should consider the social consequences of economic actions when making business decisions and that there should be a presumption in favor of decisions that have both good economic and social consequences refers to
- Kantian ethics.
- business ethics.
- corporate social responsibility.
- rights theory.
- sustainable strategy.
Question-8
_______ argued that companies “do well by doing good.”
- Michael Porter
- Milton Friedman
- Adam Smith
- John Rawls
- Benjamin Franklin
Question-9
Moral philosophers argue that companies have a responsibility to give back to society as a means of offsetting the ____ they have as a result of their control over resources and ability to move production from one country to another.
- profits
- change
- sales
- power
- revenues
Question-10
Who benefits from corporate social responsibility?
- government
- management
- low level employees
- the local community
- unions
Question-11
Jacques relies on a cost-benefit analysis to decide if moving operations overseas is better than increasing the size of the current manufacturing facility in the United States. He is using the ________ approach to ethics to determine his answer.
- utilitarian
- naive moralist
- difference principle
- cultural relativist
- Friedman doctrine
Question-12
Krisp Systems decides to move production to a developing country where they are free to pump pollutants into the atmosphere without legal restriction. By doing this, the company is contributing to
- corporate social responsibility.
- cultural relativism.
- corruption.
- the global tragedy of the commons.
- sustainability
Question-13
Thinking Through Ethical Problems
How do managers decide upon an ethical course of action when confronted with decisions pertaining to working conditions, human rights, corruption, and environmental pollution? From an ethical perspective, how do managers determine the moral obligations that flow from the power of a multinational? In many cases, there are no easy answers to these questions because some are very real dilemmas with no obvious correct action. Nevertheless, managers can and should do many things to make sure that basic ethical principles are adhered to and that ethical issues are routinely inserted into international business decisions.
In addition to establishing the right kind of ethical culture in an organization, business people must be able to think through the ethical implications of decisions in a systematic way. To do this, they need a moral compass, and both rights theories and Rawls’s theory of justice help to provide such a compass. Beyond these theories, some experts on ethics have proposed a straightforward practical guide—or ethical algorithm—to determine whether a decision is ethical, while others have recommended a five-step process to think through ethical problems (this is another example of an ethical algorithm).
Place the steps involved in the decision-making process, surrounding the creation of an organization’s ethical culture in the correct order.
- Engage in ethical behavior
- Audit decisions
- Establish moral intent
- Judge the ethics of strategic decisions
- Identify stakeholder’s decisions
Question-14
Which ethical approach typically focuses on the attainment of fair and equitable distribution of economic goods and services?
- utilitarian approaches
- justice theories
- Sullivan principles
- rights theories
- straw men approaches
VW Says It’s Going Full Steam on Electric Vehicles
This activity is important because, as a manager, you must be able to understand the importance of corporate social responsibility, developing sustainable strategies, and how to ensure that decisions make good economic and social sense.
The goal of this activity is to demonstrate your understanding of ethical considerations in international business.
Question-15
With its goal of offering a complete line of electric cars beginning in 2020, VW is
- trying to capitalize on the tragedy of the commons.
- eliminating head-to-head competition with other car makers.
- hoping to mitigate conflict over local emissions regulations.
- demonstrating its commitment to pursuing a sustainable strategy.
- hoping to evoke a feeling of nostalgia among older customers.
Question-16
VW’s decision to commit significant financial and R&D resources to electric vehicles can best be described as ____ approach to business ethics.
- the Friedman doctrine
- a righteous moralist
- a naïve immoralist
- a utilitarian
- a cultural relativism
Question-17
VW’s goal of being the world leader in electric vehicles together with its decision to devote large resources to the effort signals
- corporate social responsibility.
- profits trump ethical behavior.
- that commitment to sustainability is a requirement for promotion.
- that personal ethics are important.
- the engagement of ethics officers.
Question-18
When considering the implications of its decision to provide an electric version of its cars, VW
- put the demands of shareholders above stakeholders.
- should encourage nobles oblige at the expense of corporate social responsibility.
- must engage ethics officers to ensure the legality of its decisions.
- should avoid moral courage and focus on cultural relativism.
- must use moral imagination.
Question-19
________ gives employees the integrity to go public to the media and blow the whistle on persistent unethical behavior in a company.
- Righteous moralism
- Naive immoralism
- Cultural relativism
- Moral courage
- Moral imagination
Question-20
Jerome knew it was wrong for his company to continue ignoring environmental standards set down by the state. Jerome is able to determine this based on
- business development.
- business goals.
- business objectives.
- business strategies.
- business ethics.
Question-21
Saturn Systems Inc., which is headquartered in the United States, has its production plant located in a less-developed country where working conditions are poor. For example, employees work 15-hour shifts, are exposed to toxic chemicals, and are forced to work overtime. What type of behavior is Saturn Systems Inc. exhibiting?
- fair
- uneconomical
- just
- courageous
- unethical
Question-22
The ________ approach to ethics holds that the moral worth of actions or practices is determined by their consequences and is committed to the maximization of good and the minimization of harm.
- Kantian
- Friedman doctrine
- righteous moralism
- utilitarian
- cultural relativism
Question-23
A ________ is an individual or group that has an interest or claim in what a company does and how well it performs.
- drawee
- competitor
- stakeholder
- supplier
- trustee
Question-24
The basic position of the Friedman doctrine says that
- people should be treated as ends and never purely as means to the ends of others.
- the best business decisions are those that produce the greatest good for the greatest number of people.
- a multinational’s home-country standards of ethics are appropriate to follow in foreign countries.
- the only social responsibility of business is to increase profits, so long as the company stays within the rules of law.
- businesses should undertake social expenditures beyond those that are mandated by the law.
Question-25
Payments used to ensure receiving the standard treatment that a business ought to receive from a foreign government, but might not due to the obstruction of a foreign official, are called
- purchasing parity.
- grease payments.
- kickbacks.
- forward exchange payments.
- deferred payments.