Question 1

Most executives feel that which of the following is the primary reason for much of the unchecked misconduct in business?
A) Bad employees
B) An inattentive board of directors
C) Customer pressures
D) Financial performance pressures
E) Inadequate ethics and compliance programs

Accepted Answer

E

Question 2

Organizational _____ can contribute to diminished employee trust and increased employee turnover.
A) leadership succession
B) compensation policies
C) ethics programs
D) rules
E) misconduct

Accepted Answer

E

Question 3

Top managers tend to focus on _____ because their jobs and personal identity are often connected to quarterly returns.
A) financial performance
B) employee satisfaction
C) ethical performance
D) the board of directors' recommendations
E) adherence to the code of conduct

Accepted Answer

Top managers are often evaluated based on their ability to improve financial performance and meet quarterly targets. This places a strong emphasis on financial performance for them.

Question 4

The Federal Sentencing Guidelines for Organizations require federal judges to increase fines for organizations that continually
A) improve their ethics programs.
B) eliminate misconduct.
C) fail to install a Federal Sentencing Guidelines program.
D) fail to report ethics program activities.
E) tolerate misconduct.

Accepted Answer

The Federal Sentencing Guidelines for Organizations require federal judges to increase fines for organizations that tolerate misconduct. This is because the Guidelines prioritize the prevention of misconduct and require organizations to have effective compliance and ethics programs in place. Tolerating misconduct demonstrates a lack of commitment to ethical behavior and compliance, which increases the likelihood of future misconduct.

Question 5

For an ethical compliance program to properly function,
A) consistent enforcement and disciplinary action are essential.
B) employees must be monitored using any means necessary.
C) it is not necessary to set measurable program objectives.
D) the same program should be used in all countries of operation, regardless of cultural differences.
E) the company must wait until after misconduct occurs to develop a means of preventing it.

Accepted Answer

Consistent enforcement and disciplinary action are essential for an ethical compliance program to properly function. This demonstrates that the company takes ethical conduct seriously and that employees will face consequences for violating ethical standards. It also helps to deter future misconduct.

Question 6

A code of ethics that does not address specific high-risk activities within the scope of daily activities is
A) sufficient.
B) inadequate.
C) satisfactory.
D) acceptable as long as individual values prevent misconduct.
E) acceptable according to the Federal Sentencing Guidelines for Organizations.

Accepted Answer

A code of ethics must address high-risk activities within the scope of daily activities to mitigate the risk of misconduct, and failure to do so would make it inadequate. A sufficient code of ethics must be comprehensive and take into account all possible areas of potential risk. A satisfactory code of ethics would address specific high-risk areas, but may have room for improvement. An acceptable code of ethics should be comprehensive, but personal values should not be the sole determinant of ethical behavior in an organization. The Federal Sentencing Guidelines for Organizations recommends that companies have comprehensive and effective code of ethics, but does not specify whether it must address specific high-risk activities.

Question 7

Which of the following is an advantage of a values-based ethics program over a compliance-based one?
A) Employees learn to make decisions based on values such as fairness, compassion, respect, and transparency.
B) Diverse employees have differing values.
C) It requires employees to identify with and commit to specific required conduct.
D) A values orientation uses legal terms, statutes, and contracts that teach employees the rules and penalties for noncompliance.
E) Values and compliance programs both take basically the same approach.

Accepted Answer

A values-based ethics program emphasizes the importance of ethical values such as fairness, compassion, respect, and transparency in decision-making, which can lead to higher levels of ethical behavior and greater employee engagement, trust, and loyalty. Compliance-based programs, on the other hand, tend to focus more on rules, regulations, and penalties for noncompliance. While both types of programs may be useful, a values-based program is more likely to foster a positive, ethical organizational culture.

Question 8

What is not a common mistake when designing and implementing an ethics program?
A) Failing to fully understand the goals of the program
B) Not setting realistic or measurable goals
C) Having top management take ownership of the ethics program
D) Developing materials that do not address the needs of the average employee
E) Transferring a program between countries and cultures without making adjustments

Accepted Answer

Having top management take ownership of the ethics program is a crucial factor in the success of the program, and not doing so is a common mistake. The other options are all potential mistakes that can occur when designing and implementing an ethics program.

Question 9

A(n) _____ orientation creates order by requiring that employees identify with and commit to specific required conduct, whereas a(n) _____ orientation strives to develop shared standards.
A) obedience; values
B) compliance; values
C) legal; values
D) values; compliance
E) values; obedience

Accepted Answer

The answer of A(n) _____ orientation creates order by requiring...

Question 10

Fostering ethical decision making within an organization requires improving the firm's ethical standards and
A) not doing business with suppliers.
B) implementing a hiring freeze.
C) training the "bad apples" so they are not bad anymore.
D) terminating ethical persons.
E) terminating the "bad apples" in the organization.

Accepted Answer

Terminating the "bad apples" in the organization is the best choice as it removes any individuals who may be acting unethically and potentially influencing others to do the same. It sends a message that unethical behavior will not be tolerated within the organization. Improving ethical standards can also be beneficial but may not have the immediate impact that removing unethical individuals can have. Not doing business with suppliers or implementing a hiring freeze may not be necessary or effective in fostering ethical decision making. Training the "bad apples" may help in some cases, but it is not a guaranteed solution and may not be feasible depending on the severity of their behavior. Terminating ethical persons is counterproductive and should not be done.

Question 11

Which of the following is a common mistake made in implementing an ethics program?
A) Setting realistic and measurable program objectives
B) Developing materials that do not address the needs of the average employee
C) Adapting a firm's ethics program to its international operations
D) Allowing employees to practice the skills they learn in ethics training through case studies and/or group exercises
E) Management taking ownership of the ethics program

Accepted Answer

Developing materials that do not address the needs of the average employee is a common mistake made in implementing an ethics program. It is important for the program materials to be tailored to the specific audience and address their concerns and perspectives.

Question 12

Which of the following statements about codes of conduct is false?
A) They are formal statements of what an organization expects of its employees.
B) They guarantee an ethical business climate.
C) They help employees determine what behaviors are acceptable.
D) They provide rules and guidelines for employees to follow.
E) They should be specific enough to be reasonably capable of preventing misconduct.

Accepted Answer

Codes of conduct cannot guarantee an ethical business climate as they are only a tool or guide for employees to follow. It ultimately depends on the actions and decisions made by individuals within the organization.

Question 13

_____ are formal statements that describe what an organization expects of its employees in terms of ethical behavior.
A) Mission statements
B) Codes of conduct
C) Policies on confidentiality
D) Environmental policies
E) The Federal Sentencing Guidelines for Organizations

Accepted Answer

Codes of conduct specifically outline the ethical behavior and expectations an organization has for its employees. Mission statements typically outline the overall purpose and goals of the organization, policies on confidentiality and environmental policies are specifically related to confidentiality and environmental concerns, and the Federal Sentencing Guidelines for Organizations are a set of legal guidelines for companies to follow in order to promote ethical behavior, but they are not the same thing as a code of conduct.

Question 14

A strong ethics program includes all of the following elements except
A) a clause promising good stock market performance.
B) a written code of conduct or ethics.
C) formal ethics training.
D) auditing, monitoring, enforcement, and revision of standards.
E) an ethics officer to oversee the program.

Accepted Answer

A clause promising good stock market performance is not a necessary element of a strong ethics program. The other elements listed are important components of an effective ethics program.

Question 15

At the heart of the Federal Sentencing Guidelines for Organizations is a
A) "tit-for-tat" philosophy that punishes wrongdoing.
B) Golden Rule philosophy.
C) Iron Fist philosophy severely punishes wrongdoing.
D) carrot-and-stick philosophy that rewards efforts to improve ethics.
E) utilitarian philosophy of the greatest good for the greatest number.

Accepted Answer

The answer of At the heart of the Federal Sentencing...

Question 16

In the absence of ethics programs, employees are likely to make decisions based on
A) their observations of how their coworkers and superiors behave.
B) how they and their family members behave at home.
C) their conscience.
D) their religious values.
E) their family values.

Accepted Answer

Without a formal ethics program in place, employees are likely to rely on their observations of how their coworkers and superiors behave to inform their own decision-making. This is known as the "shadow of the leader" effect, where employees look to their leaders as a model for how to behave.

Question 17

Which of the following is the most comprehensive?
A) Code of values
B) Code of conduct
C) Code of ethics
D) Statement of values
E) Statement of principles

Accepted Answer

A code of ethics is the most comprehensive as it outlines a set of principles and values that guide an organization's decision-making and behavior. It goes beyond a simple list of rules (code of conduct) or statements (statement of values/principles) and includes guidance on ethical dilemmas and expectations for individual behavior. A code of values may be similar but tends to be more focused on the organization's beliefs and priorities rather than ethical considerations.

Question 18

All of the following are useful in monitoring ethical conduct and measuring the effectiveness of the ethical program except
A) observation of employees.
B) internal audits.
C) firing.
D) surveys.
E) reporting systems.

Accepted Answer

Firing an employee is not a measure of monitoring ethical conduct or measuring the effectiveness of the ethical program. It is a consequence for unethical behavior, but it does not contribute to the ongoing monitoring and improvement of ethical conduct in the organization. The other options (observation, internal audits, surveys, and reporting systems) are all useful in monitoring ethical conduct and measuring the effectiveness of the ethical program.

Question 19

Which of the following legislation has increased the responsibilities on ethics officers and boards of directors to monitor financial reporting?
A) Sarbanes-Oxley Act
B) Robinson Patman Act
C) Ethics Officer Responsibility Act
D) Sherman Antitrust Act
E) Enron Financial Responsibility Act

Accepted Answer

The Sarbanes-Oxley Act, also known as the Public Company Accounting Reform and Investor Protection Act, was enacted in response to accounting frauds and scandals such as Enron and WorldCom. It has increased the responsibilities and accountability of ethics officers, boards of directors, and senior executives to monitor financial reporting, internal controls, and financial disclosures to ensure the accuracy, transparency, and integrity of financial statements.

Question 20

_____ may be more inclined to engage in unethical organizational conduct because of social isolation that creates insensitivity and a lower level of motivation to regulate ethical decision making.
A) Low-level employees
B) International managers
C) Top managers
D) Government officials
E) Fortune 500 companies

Accepted Answer

Top managers may be more inclined to engage in unethical organizational conduct because their position of power and social isolation create insensitivity and a lower level of motivation to regulate ethical decision making. This is known as ethical fading, where the ethical implications of a decision become less prominent as it moves up the chain of command.

Quiz 8: Developing an Effective Ethics Program

Most executives feel that which of the following is the primary reason for much of the unchecked misconduct in business?

Organizational _____ can contribute to diminished employee trust and increased employee turnover.

Top managers tend to focus on _____ because their jobs and personal identity are often connected to quarterly returns.

The Federal Sentencing Guidelines for Organizations require federal judges to increase fines for organizations that continually

For an ethical compliance program to properly function,

A code of ethics that does not address specific high-risk activities within the scope of daily activities is

Which of the following is an advantage of a values-based ethics program over a compliance-based one?

What is not a common mistake when designing and implementing an ethics program?

A(n) _ orientation creates order by requiring that employees identify with and commit to specific required conduct, whereas a(n) _ orientation strives to develop shared standards.

Fostering ethical decision making within an organization requires improving the firm's ethical standards and

Which of the following is a common mistake made in implementing an ethics program?

Which of the following statements about codes of conduct is false?

_____ are formal statements that describe what an organization expects of its employees in terms of ethical behavior.

A strong ethics program includes all of the following elements except

At the heart of the Federal Sentencing Guidelines for Organizations is a

In the absence of ethics programs, employees are likely to make decisions based on

Which of the following is the most comprehensive?

All of the following are useful in monitoring ethical conduct and measuring the effectiveness of the ethical program except

Which of the following legislation has increased the responsibilities on ethics officers and boards of directors to monitor financial reporting?

_____ may be more inclined to engage in unethical organizational conduct because of social isolation that creates insensitivity and a lower level of motivation to regulate ethical decision making.