Question 1

A social audit is a systematic evaluation of an organization's progress toward implementing programs that are profitable.

Accepted Answer

A social audit is a systematic evaluation of an organization's social and ethical performance, not its profitability.

Question 2

Some experts feel that corporate social responsibility means solely making money for stockholders.

Accepted Answer

The answer of Some experts feel that corporate social responsibility...

Question 3

A firm's net social contribution is a company report that measures the difference between its positive social contributions and its negative social impact.

Accepted Answer

The statement correctly defines a firm's net social contribution.

Question 4

A business that takes a public position on a political issue that affects the welfare of society is exercising corporate social responsibility.

Accepted Answer

By taking a stance on a political issue that impacts society's welfare, a business shows that it is aware of its role and influence in society and takes responsibility for promoting social good. This is an example of corporate social responsibility.

Question 5

Out-Tel, a computer chip manufacturer, knowingly sold defective chips and failed to notify customers of the potential problems. When the problem became public knowledge, the firm's stock price fell dramatically. This illustrates the value that investors place on the ethical behavior of businesses.

Accepted Answer

The scenario suggests that when a company engages in unethical behavior, such as selling defective products and failing to communicate the potential problems to customers, investors will react negatively and the company's stock price will fall. Therefore, this illustrates the value that investors place on ethical behavior in businesses.

Question 6

Corporate social responsibility covers all those social issues outside our businesses that affect customers and the environment, but not internal issues such as employee considerations and work safety. Internal issues are covered by business laws.

Accepted Answer

Corporate social responsibility covers both external and internal social issues, including employee considerations and work safety. It goes beyond business laws and involves companies taking responsibility for their impact on society and the environment.

Question 7

A corporate policy should never make a value statement about the environment or other social and political issues, because it is doubtful the company can live up to the proclamation.

Accepted Answer

The answer of A corporate policy should never make a...

Question 8

A public good is one that everyone gets to enjoy regardless of who pays for it.

Accepted Answer

A public good is non-excludable, which means that once it is provided, it is difficult to exclude individuals from enjoying its benefits. Examples of public goods include clean air and national defense. In many cases, public goods are funded through taxes or government expenditures, but everyone in the community still benefits from them.

Question 9

As a response to the Enron scandal, the federal government now requires social audits of all U.S. businesses.

Accepted Answer

While the Enron scandal did lead to increased scrutiny of corporate accounting and governance, the federal government does not require social audits of all U.S. businesses. Social audits are voluntary assessments of a company's social and environmental impact, and some companies choose to conduct them as part of their corporate social responsibility initiatives.

Question 10

Opponents of corporate social responsibility argue that firms which use their profits to promote social causes are not being fair to investors who provided the funds for the purpose of financial gain.

Accepted Answer

The answer of Opponents of corporate social responsibility argue that...

Question 11

Often it is the threat of negative publicity that pressures businesses to enforce their corporate code of ethics.

Accepted Answer

The threat of negative publicity can damage a business's reputation and bottom line, causing them to take action to enforce ethical standards and avoid a public relations crisis.

Question 12

The green movement has turned the heads of very few firms.

Accepted Answer

Many firms have started to implement more eco-friendly practices and products in response to the green movement.

Question 13

The green movement has resulted in a positive impact on U.S. jobs.

Accepted Answer

The green movement has created jobs in various sectors such as renewable energy, energy efficiency, and sustainable agriculture. According to a report by the Environmental Defense Fund, the clean energy sector alone employed over 3 million people in the US in 2019. Additionally, transitioning to more sustainable practices has led to job growth in industries such as manufacturing, construction, and transportation.

Question 14

In a famous speech, former President John
F. Kennedy proposed that businesses had four basic rights, and in his own words, he proclaimed that "each one of them leads us back to the right to keep the profits from one's business."

Accepted Answer

The answer of In a famous speech, former President John
F....

Question 15

At a recent town hall meeting, citizens expressed concern regarding the impact of a proposed new gambling casino. The owner of the proposed casino responded, "I don't know what all of this fuss is about. I'm just a businessman trying to earn a profit, provide new jobs, and pay taxes." His response reflects an overall commitment to corporate social responsibility.

Accepted Answer

The owner's response does not demonstrate an overall commitment to corporate social responsibility, as he only mentions profit, job creation, and tax payment without addressing the concerns of the citizens regarding the potential negative impacts of the casino.

Question 16

A social audit measures a firm's progress in the area of worker-management relations.

Accepted Answer

A social audit assesses the social and ethical impact of a business, including factors such as worker-management relations, environmental impact, and community involvement.

Question 17

Defining a socially responsible company is complicated. Businesses differ from other businesses, as well as the people they serve, on what we mean by "socially responsible."

Accepted Answer

This statement is true. Different businesses and individuals may have different ideas of what it means to be socially responsible, making it a complicated concept to define.

Question 18

When it comes to ethics and social responsibility, the public's perception of a firm is as important as what the firm does.

Accepted Answer

The public perception of a firm's ethics and social responsibility can greatly impact its reputation, brand image, and even financial performance. Therefore, it is important for firms to not only behave ethically and responsibly but also communicate these actions effectively to the public to maintain a positive perception.

Question 19

Although the green movement is a social trend, it is difficult to predict its future contributions to society.

Accepted Answer

The answer of Although the green movement is a social...

Question 20

A list of "watchdogs" (including customers, socially conscious investors, and environmentalists) monitor how well firms enforce their ethical and social responsibility policies.

Accepted Answer

The statement is true. Watchdogs such as customers, socially conscious investors, and environmentalists keep a check on how well firms enforce their ethical and social responsibility policies.

Quiz 4: Demanding Ethical and Socially Responsible Behavior