Multiple Choice Answers

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1 Research has shown that the best way to encourage ethical behavior is to create an organizational culture that is built to enhance employee engagement.
A TRUE
B FALSE

2 Typical codes of conduct cover conduct described below. In the aftermath of Bhopal, the chemical industry, wishing to demonstrate responsible corporate citizenship, has added which additional behaviors set out below?
A Legal compliance
B Continuous improvement, communication with external stakeholders, and training of suppliers on the standards
C Community awareness and emergency response
D Pollution prevention
E Safe distribution of chemicals in transit

3 A decrease in levels in the organizational hierarchy leads to better lateral communication among employees and makes it more difficult for employees to rationalize that higher-ups were responsible.
A TRUE
B FALSE

4 The Social Investment Forum reported that socially responsible investing grew from $40 billion in 1984 to nearly $3 trillion in 2007 (out of $25 trillion in the US marketplace).
A TRUE
B FALSE

5 Norms often arise to support behaviors that are implicitly rewarded.
A TRUE
B FALSE

6 Federal law prohibits discrimination against individuals with specific characteristics. Which of the following characteristics is not on that list (i.e., not protected under federal law)?
A Religion
B Gender
C Pregnancy
D Mental ability

7 Actively engaged employees help an organization by keeping turnover and absenteeism low, while promoting higher customer loyalty.
A TRUE
B FALSE

8 Group norms can cause an “everyone is doing it mentality.” This means
A People are more likely to recognize issues as ethical issues
B Many individuals will go along with unethical behavior because of a strong need for peer acceptance
C Managers cannot blame individual employees for unethical behavior
D Employees are actively disengaged in groups

9 Behavior is difficult to predict because people adapt their behaviors to what they believe others expect of them.
A TRUE
B FALSE

10 Which of the following is false?
A Any attempt to change an organization’s ethics must consider the entire cultural system
B A cultural system includes both formal and informal systems
C An effective culture change may take as long as one to two years
D New rules and values must be reinforced via training programs and reward systems

11 Nothing will put a company out of business faster than offering a product that is dangerous, poorly produced, or of inferior quality.
A TRUE
B FALSE

12 Because of a family emergency, John was unable to complete a report for his boss. Instead, he asks a coworker to finish it for him, and in the morning, John tells his boss that he did the report. Is there anything wrong with John’s action?
A No, because John’s coworker only finished what John had started
B No, because John had a family emergency and his boss doesn’t need the details. The report is done
C Yes, because John told a lie to his boss and put his reputation on the line
D Yes, because John is indebted to his coworker now

13 If your manager asks you to betray your ethical standards, respond politely but firmly that you will not compromise your standards.
A TRUE
B FALSE

14 _____________ is a term frequently used to describe ethics initiatives that begin at the top of the organization and work their way down, level by level.
A Surveying
B Globalizing
C Auditing
D Cascading
E Collaborating

15 Because stakeholders’ interests frequently do not overlap, an organization is able to focus on one stakeholder at a time.
A TRUE
B FALSE

16 Social Accountability 8000 (SA 8000) was founded to help organizations be social accountable in the arena of workplace conditions. The standard includes but is not limited to
A Child labor
B Forced labor
C Health and safety
D Discrimination
E All of the above

17 In its Bribe Payers Index (BPI) of 2008, Transparency International (TI) cited Russia, China, Mexico, and India for having particularly high levels of perceived bribery.
A TRUE
B FALSE

18 Which of the following is false?
A Organizations are affected by the expatriate manager’s ability to adjust to the new setting
B Organizations are not affected by the expatriate family’s ability to adjust to the new setting
C Foreign language proficiency is more important for non-English speakers in English-speaking countries
D Cross-cultural training can help an expatriate manager better adjust to the new culture

19 The definition of conflict for an organization is similar to that for an individual; that is, if a stakeholder thinks that an organization’s judgment is biased because of a relationship it has with another firm, a conflict could exist.
A TRUE
B FALSE

20 Failure to be socially responsible is costly.
A TRUE
B FALSE

21 The U.S. Sentencing Guidelines use a carrot and stick approach to managing corporate crime. What is meant by the use of carrot and stick?
A The carrot dangles at the end of the stick as an incentive for organizations to continue to behave ethically
B The carrot refers to the guidelines as food for thought, and the stick refers to the punishment if the guidelines are not followed
C The carrot refers to incentives in the guidelines to behave ethically, and the stick refers to the punishment if the guidelines are not followed
D None of the above

22 In this example of a conflict of interest, ________ conducted a series of off-the-books partnerships that were used to hide the organization’s debt and inflate its stock price. The partnerships were managed by the company’s executives, who stood to profit the most from the transactions.
A Merrill Lynch
B Enron
C Citicorp
D Adelphia

23 ___________ have their own agenda and lack any company or professional loyalty.
A Deserters
B Misguided cannons
C Grenades
D Toxic ammo

24 Which of the items listed is not a product of a “favorable corporate reputation?”
A Charge more for its products and services
B Attract, hire, and keep higher quality applicants/employees
C Enhance their access to better capital markets
D Attract investors
E Ignore the Foreign Corrupt Practices Act

25 According to the U.S. Federal Sentencing Guidelines, responsibility to oversee legal compliance standards can be divided among legal counsel, internal auditors, or human resource professionals.
A TRUE
B FALSE

26 Weak organizational cultures are
A Desirable if an organization has many subcultures
B Desirable if an organization wants diversity of thought and action
C Desirable if an organization wants behavioral consistency
D Undesirable in all situations

27 The title “ethics officer” did not exist until the early 1990s.
A TRUE
B FALSE

28 Which of the following is false?
A People enter organizations in a state of “role readiness”
B Roles reduce a person’s sense of individuality
C Managers do not have roles as much as their subordinates do
D Conflicting role expectations can cause increased incidences of lying

29 Conflicts involving organizations are more damaging than those who involve individuals.
A TRUE
B FALSE

30 The pragmatic approach is more proactive and affirmative than the strategic approach because it asks companies to identify and acknowledge company activities that can do harm and encourages firms to scrutinize their practices and address potential harms by focusing on their own value-chain activities.
A TRUE
B FALSE

31 Which of the following is false?
A A mission statement describes how we do business
B Mission statements should be short and memorable
C Mission statements should be written by outsiders who are unbiased
D For some companies, mission statements are a mainstay of the corporate culture

32 Although bribes are an accepted part of commercial transactions in many Asian, African, Latin American, and Middle Eastern countries, it is usually against the law in these very same countries.
A TRUE
B FALSE

33 According to United States v. Booker, judges are no longer required to follow strictly the U.S. Sentencing Guidelines.
A TRUE
B FALSE

34 According to ethics and compliance officers, a respected and trusted insider who knows the company’s culture and people is a preferable choice for a firm’s ethics or compliance officer.
A TRUE
B FALSE

35 You are a manager forced to lay off certain employees. What is the primary objective that should guide your treatment of these individuals?
A To make the process as quick and painless to the company as possible
B To ensure the grapevine is passing truthful information
C To ensure layoff survivors understand why they were not chosen
D To allow the terminated employee to maintain personal dignity

36 In a classic example of failing to protect its employees, ___________ knew asbestos caused cancer as early as 1930. However, the company lied to its employees and used several tactics to cover up the product’s effects.
A Johnson & Johnson
B A.H. Robbins
C Manville Corporation
D McWane, Inc

37 According to the Executive Ethical Leadership Reputation Matrix, ___________ is an executive characterized as a weak moral person and a strong moral manager.
A Unethical leader
B Ethical leader
C Ethically neutral leader
D Hypocritical leader

38 For the public, the top three factors in corporate reputation are
A Transparent and honest practices, trustworthiness, and high-quality products and services
B Transparent and honest practices, community philanthropy, and high-quality products and services
C Trustworthiness, high-quality products, and a no-layoff policy
D Trustworthiness, high-quality products, and a 90-day customer return policy

39 An organization that does not fulfill its philanthropic responsibilities is acting unethically.
A TRUE
B FALSE

40 People do not want to believe that the world operates on the principles of fairness.
A TRUE
B FALSE

41 ____________ reflects acceptance of inequality and respect for social status or class boundaries.
A Individualism
B Collectivism
C High power distance
D Low power distance

42 Organization cultures vary widely, even within the same industry.
A TRUE
B FALSE

43 Generally, people take a single ethical self from situation to situation.
A TRUE
B FALSE

44 Which of the following is an example of a high power distance country?
A India
B United States
C Israel
D None of the above

45 The additional costs of corruption to international projects is less than 5 percent on average making it practical to include corruption as a cost of doing business.
A TRUE
B FALSE

46 The __________ experiment demonstrated how normal students accepted and acted on their randomly assigned role of prisoner or guard.
A Milgram
B Manville
C Zimbardo
D My Lai

47 When an employee brings up an ethical concern at work, the manager is obliged to take the issues completely off the employee’s hands.
A TRUE
B FALSE

48 Interface Carpets, a stellar example of sustainability in action, lists seven fronts of Mount Sustainability. Which is not one of the firm’s goals to meet its total sustainability status?
A Redesigning commerce
B Sensitizing stakeholders
C Using renewable energy
D Ensuring benign emissions
E Eliminating waste
F None of the above

49 Companies that look for advice from consultants will do well to find a spray and pray plan.
A TRUE
B FALSE

50 Describing the decision-making process in the language of ethics does not help individuals make more ethical decisions.
A TRUE
B FALSE.