Question 1

Which of the following is the greatest challenge in meeting a firm's social responsibility?
A) Determining when to conduct ethical training
B) Determining the contents of the code of ethics
C) Determining when to conduct a social audit
D) Knowing what social responsibility is
E) Determining how to respond to the interests of one part of society (e.g., investors) which conflict with the needs of another part of society (e.g., customers)

Accepted Answer

Balancing the conflicting interests of different stakeholders is often the most challenging aspect of meeting a firm's social responsibility. It can be difficult to satisfy the needs of investors, customers, employees, communities, and the environment all at once. Determining when to conduct ethical training, creating a code of ethics, and conducting social audits are important steps in meeting social responsibility, but they are not the greatest challenge. Knowing what social responsibility is may be a hurdle for some organizations, but it is generally a lesser challenge than balancing stakeholder interests.

Question 2

All of the following are functions of codes of ethics except
A) they increase public confidence in a firm or its industry.
B) they ensure that unethical behaviour will not occur in the firm.
C) they may help stem the tide of government regulation.
D) they improve internal operations by providing consistent ethical standards.
E) they help management respond to problems that arise as a result of unethical behaviour.

Accepted Answer

While codes of ethics are intended to promote ethical behaviour, they cannot ensure that unethical behaviour will not occur. Rather, they provide a framework for ethical decision-making and a basis for discipline or remedial action if breaches occur.

Question 3

John wants his employees to be aware that they should act ethically. He should
A) fire anyone who behaves unethically.
B) not draw public attention to any employee's unethical behaviour, but instead deal with it privately.
C) publicly reward ethical behaviour and ignore unethical behaviour.
D) publicly discipline employees who behave unethically, but don't fire them.
E) adopt a written code of ethics.

Accepted Answer

Adopting a written code of ethics is the best choice to make employees aware of ethical behavior. This code should be communicated clearly to all employees and should guide them on how to behave ethically in all situations. A written code of ethics provides clarity on what is expected, promotes a culture of ethical behavior, and helps employees make the right decisions when faced with ethical dilemmas.

Question 4

The CEO of Perry's Pizzeria, a rapidly growing restaurant chain, is committed to a high level of corporate social responsibility along with continued business success. Which action by the CEO would most enhance the company's reputation for social responsibility?
A) Using more nutritious but more expensive, ingredients
B) Cutting employees' wages and benefits to boost the company's stock price
C) Using marketing or advertising methods that would allow the company to discreetly reduce pizza size without also reducing the price
D) Packaging products in material that costs less, even if customers object to the change
E) Taking steps that would cause competitors to close their doors

Accepted Answer

Using more nutritious but more expensive ingredients shows a commitment to social responsibility by prioritizing the health and well-being of consumers over short-term cost savings. This can also contribute to a positive reputation for the company and attract socially conscious customers.

Question 5

Which of the following statements is most likely to be included in a company's code of ethics?
A) We reward high achievers.
B) We strive for domination in the market.
C) We achieve our objective by raising capital.
D) We believe in our company brand.
E) We reward all valuable contributions.

Accepted Answer

A code of ethics is a set of principles that guides the behavior of individuals within an organization. The statement "We reward high achievers" may encourage unethical behavior, such as cutting corners and sacrificing quality to meet targets. "We strive for domination in the market" could promote unethical business practices, such as price fixing, monopolization, or using deceitful advertising. "We achieve our objective by raising capital" does not address ethical behavior, as it simply describes a common strategy for achieving business objectives. "We believe in our company brand" is too vague and does not provide guidance on specific ethical behavior. "We reward all valuable contributions" is a positive statement that encourages ethical behavior by valuing contributions beyond just achieving targets. Therefore, the best choice is E.

Question 6

Which of the following illustrates consumers' rights to safe products?
A) Clothing must be labelled with information about its proper care.
B) A new vacuum cleaner must be free of electrical hazards while in use cleaning a consumer's home.
C) There must be open competition in the marketplace.
D) Procter & Gamble provides a toll-free telephone number for consumers to use for complaints or questions.
E) Food products must list their ingredients.

Accepted Answer

The right to safe products means that products must not pose a risk to consumers' health or safety. A new vacuum cleaner must be free of electrical hazards while in use, ensuring that it is safe for the consumer to operate.

Question 7

Why did the fair trade movement develop?
A) Because large industrialized countries were using unfair trading practices with developing countries
B) Because pollution was increasing too rapidly in developing countries as a result of excessive investment in mining operations
C) Because workers involved in producing commodities like coffee were not receiving fair payment for their products
D) Because free trade agreements were hurting smaller producers
E) Because there was a surplus of cotton as a result of highly efficient U.S. production

Accepted Answer

The fair trade movement originally developed in response to the exploitation of workers involved in producing commodities like coffee. Fair trade organizations sought to ensure that these workers received fair payment for their products and were treated with dignity and respect.

Question 8

Approximately ________ of Canadian firms have codes of ethics, while approximately ________ of U.S. firms have them.
A) one-third; two-thirds
B) two-thirds; nine-tenths
C) one-fifth; one-fourth
D) one-half; one-half
E) one-half; three-quarters

Accepted Answer

Two-thirds of Canadian firms and nine-tenths of U.S. firms have codes of ethics, reflecting a higher prevalence of formal ethical guidelines in American companies compared to their Canadian counterparts.

Question 9

________ is the view that a company's only social responsibility is to make as much money as possible for its shareholders.
A) Free market capitalism
B) Managerial capitalism
C) Globalization
D) Mixed economy capitalism
E) None of these

Accepted Answer

Managerial capitalism is the view that a company's primary responsibility is to maximize profits for its shareholders, aligning with the idea that the main social responsibility of a business is to increase its profitability.

Question 10

Which of the following questions would a company dedicated to increasing its level of corporate social responsibility be least likely to ask?
A) "How can we afford to pay our employees more?"
B) "Should we offer more sales in order to better serve our customers?"
C) "Can we purchase better quality ingredients while still making a profit?"
D) "Which charitable donations will make our investors most happy?"
E) "If our profits go up, can we lay off some of our employees?"

Accepted Answer

A company focused on corporate social responsibility would be least likely to consider laying off employees if profits increase, as this contradicts the principles of social responsibility, which include fair treatment of employees.

Question 11

Jana and Kate are the owners of an upscale jewelry boutique that offers unique and much-desired accessories in an affluent neighborhood. Jana and Kate are concerned, however, that the company's commitment to social responsibility has begun to diminish in various respects. How would this most likely be evident?
A) Other local businesses may be forced to close their doors.
B) The health of employees and their children is starting to suffer.
C) Local investors and stakeholders seek to invest their money elsewhere.
D) The boutique's customer base may decrease sharply due to moderate increases in price.
E) Employees may begin making fewer charitable personal donations.

Accepted Answer

A diminishing commitment to social responsibility would most likely be evident in negative impacts on the health and well-being of employees and their families, as this directly relates to the company's responsibility towards its workforce.

Question 12

All of the following groups are organizational stakeholders except
A) employees.
B) investors.
C) customers.
D) competitors.
E) all of these groups are organizational stakeholders.

Accepted Answer

Competitors are not considered organizational stakeholders as they are external entities that operate in the same industry or market, but are not directly impacted by the actions of the organization in question. Employees, investors, and customers are all considered organizational stakeholders as they have a direct stake in the success and actions of the organization.

Question 13

Ian is the president of a medium-sized manufacturing company. He wants to ensure that his company behaves in a socially responsible way. Which of the following is the greatest challenge facing Ian?
A) Determining how to respond to the interests of one part of society which conflicts with the needs of another part of society
B) Determining the contents of the code of ethics and what takes priority
C) Determining when to conduct a social audit
D) Knowing what social responsibility is
E) Determining when to conduct ethical training for employees

Accepted Answer

Balancing conflicting interests of different parts of society can be challenging, as a socially responsible decision for one group may negatively impact another group. This requires careful consideration and decision-making to ensure that the company behaves ethically and responsibly towards all stakeholders. While the other options are also important, they may not pose as significant a challenge as balancing conflicting interests.

Question 14

The three general factors that have been identified as important in causing individuals to behave in unethical ways are
A) pressure, opportunity, and rationalization.
B) the chance for financial gain, increased status, and poor control systems.
C) the chance for financial gain, status, and power.
D) pressure from peers, subordinates, and superiors.
E) pressure from external competitors, bosses, and investors.

Accepted Answer

The three factors are pressure (which can come from peers, superiors, or external forces), opportunity (such as poor control systems or the chance for financial gain), and rationalization (finding ways to justify unethical behavior to oneself).

Question 15

The view that business should balance its commitments to important individuals and groups in its environment is known as
A) managerial capitalism.
B) social auditing.
C) social responsibility.
D) business ethics.
E) stakeholder theory.

Accepted Answer

The answer of The view that business should balance its...

Question 16

Consumerism is
A) the group of laws dealing with retail commercial transactions.
B) the movement that seeks to protect and expand the rights of consumers in their dealings with businesses.
C) the right to be informed about all aspects of a product.
D) the right to choose the product.
E) the right to safe products.

Accepted Answer

Consumerism refers to the movement that aims to protect and expand the rights of consumers in their dealings with businesses. It is focused on empowering consumers and advocating for their interests. While the other options are related to consumer rights, they do not fully capture the concept of consumerism.

Question 17

A chocolate company with a primary emphasis on ethical sourcing and procurement would most likely avoid which of the following?
A) Neglecting the welfare of the farmers who grow cacao beans
B) Reducing the size of their marketing department
C) Developing new fat-free products
D) Hosting a holiday party for all employees
E) Reducing the funds allocated to the company health care program for employees

Accepted Answer

A chocolate company focused on ethical sourcing would avoid neglecting the welfare of cacao farmers, as ethical sourcing involves ensuring fair treatment and compensation for those involved in the supply chain.

Question 18

Which of the following is the best description of organizational stakeholders?
A) Competitors
B) Government regulators
C) The officers and key employees of an organization
D) Individuals and businesses that own stock in a company
E) Individuals and groups that are directly affected by the practices of a company

Accepted Answer

The answer of Which of the following is the best...

Question 19

Jordan is a recent college graduate with a degree in computer programming. He has just begun his first full-time job and is excited to apply the skills that he worked so hard to acquire. Though he excelled as a student, Jordan is anxious about how successful he will be as an employee. When an opportunity unexpectedly presents itself to take credit for a brilliant software program that someone else wrote, Jordan does not resist and claims the program as his own. Which of the following would least likely also happen along with Jordan's decision?
A) Other recently hired employees who learn of Jordan's dishonesty are hesitant to report him because they think he is the boss's favorite new employee.
B) After thinking deeply about his behaviour, Jordan becomes better equipped to act ethically in the future.
C) Without recognizing his behaviour as unethical, Jordan steals office supplies and reports more hours on his time sheet than he has actually worked.
D) The company's ethics committee agrees that employees should not be expected to tell the truth if honesty is not part of their personal ethics.
E) An employee who reports Jordan's dishonesty consequently suffers from psychological and emotional stress.

Accepted Answer

This scenario is highly unlikely to happen, as it goes against all ethical standards. Honesty is an important virtue and should be highly valued in any workplace. The company's ethics committee is responsible for promoting ethical behavior among employees, and they are unlikely to support dishonesty in any form.

Question 20

Social return on investment (SROI) helps companies to
A) improve their financial return on investment.
B) increase employee satisfaction.
C) understand, manage, and communicate the social value of their activities for stakeholders.
D) respond to required government regulations on social responsibility
E) improve the level of ethics within the company.

Accepted Answer

Social return on investment (SROI) is a method of measuring the social, environmental and economic value created by a company's activities. It helps companies to understand, manage, and communicate the social value of their activities for stakeholders. This goes beyond financial return on investment and includes the social impact the company has on society, such as job creation, reduction in poverty, and environmental sustainability. SROI measures the return on investment in social terms, and companies can use this information to improve their social impact and create more value for their stakeholders.

Quiz 3: Conducting Business Ethically and Responsibly

Which of the following is the greatest challenge in meeting a firm's social responsibility?

All of the following are functions of codes of ethics except

John wants his employees to be aware that they should act ethically. He should

The CEO of Perry's Pizzeria, a rapidly growing restaurant chain, is committed to a high level of corporate social responsibility along with continued business success. Which action by the CEO would most enhance the company's reputation for social responsibility?

Which of the following statements is most likely to be included in a company's code of ethics?

Which of the following illustrates consumers' rights to safe products?

Why did the fair trade movement develop?

Approximately of Canadian firms have codes of ethics, while approximately of U.S. firms have them.

________ is the view that a company's only social responsibility is to make as much money as possible for its shareholders.

Which of the following questions would a company dedicated to increasing its level of corporate social responsibility be least likely to ask?

All of the following groups are organizational stakeholders except

Ian is the president of a medium-sized manufacturing company. He wants to ensure that his company behaves in a socially responsible way. Which of the following is the greatest challenge facing Ian?

The three general factors that have been identified as important in causing individuals to behave in unethical ways are

The view that business should balance its commitments to important individuals and groups in its environment is known as

Consumerism is

A chocolate company with a primary emphasis on ethical sourcing and procurement would most likely avoid which of the following?

Which of the following is the best description of organizational stakeholders?

Social return on investment (SROI) helps companies to