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Exam 4: Demanding Ethical and Socially Responsible Behavior

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Question 51

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Recently,Bob was trying to choose between three mutual fund investments for his retirement account.As a socially conscious investor,he will prefer to invest in funds that hold the stocks of oil and coal companies,as opposed to wind-turbine and renewable energy companies. Socially conscious investors make an effort to invest in companies who show high levels of social responsibility.One aspect of social responsibility deals with being green,or environmentally conscious.Companies involved with new and renewable energy sources,including the use of wind and solar energy are considered green companies.

A) True
B) False

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Question 52

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Ethical behavior will result in which of the following?

A) Mistrust between employees and managers.
B) Agreements that create benefits for only the shareholders.
C) Negative publicity from the news media.
D) Improved self-esteem - makes us feel good about our decision.

E) A) and B)
F) C) and D)

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Question 53

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Compliance-based ethics codes focus on preventing unlawful behavior by increasing control and by penalizing wrongdoers.

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." Two-thirds of the MBA students surveyed said that they would take a lower salary to work for a socially responsible company.But when asked to define a socially responsible company,things got complicated.It appears we want to be socially responsible;we just can't agree on what it involves.

Trying to make decisions that will benefit all parties involved is consistent with the question "How will it make me feel about myself?"

As a response to the Enron scandal,the federal government now requires social audits of all U.S.businesses. A social audit is a response to an integrity-based approach to ethics,which goes beyond what is required by law.Firms voluntarily prepare a self-evaluation of the progress made in implementing socially responsible and responsive programs.

High Mountain Brewers has adopted the slogan,"Cool,Clean,and Green" to promote its product line of specialty beers and company image.However,upon closer inspection,a group of concerned citizens including some former employees are protesting that the company is anything but "green".According to the Thinking Green box,titled,"Green Greed",the group is accusing the brewer of _________.

In order to combat "Green Washing",

Trust between workers and managers must be based on a foundation of fairness,honesty,openness,and moral integrity.

All U.S.companies practice the same ethical standards when dealing with suppliers and contract manufacturers abroad.

Identify the six-step approach to achieve a long-term improvement of business ethics.

Two recent studies found a strong correlation between academic dishonesty among undergraduates and dishonesty at work.

In order to avoid the costly act of being sued in court,it makes good sense to manage your business ethically. There are many reasons why a business should be managed ethically: (1)to maintain a good reputation; (2)to keep existing customers; (3)to attract new customers; (4)to avoid lawsuits; (5)to reduce turnover; (6)to avoid government intervention; (7)to please customers,employees,and society;and (8)because it is the right thing to do.

As a result of pressure from business lobbyists,Congress failed to pass legislation protecting whistleblowers.

A business should be managed ethically to keep existing customers and attract new customers.

"Greenwashed" companies have taken the green movement to the next level.These firms are so green,the U.S.government gives them a special designation.

Corporate social responsibility refers to the concern businesses have for the welfare of society.

Mini-Case Harry,Sirly,and Bo are in the midst of a heated discussion.As the chief operating officers of the U-Scream Ice Cream Corporation,they are reviewing the latest financial reports.Intense competition has resulted in deceased profits.Each of the three officers has their own view of how to reverse the current trend. Harry suggests cutting costs by firing union employees and hiring replacement workers at lower wages.He has directed the firm's attorney to find a loophole in the contract that will allow for this action.Sirly protests,stating that Harry's proposal is unethical and unfair.Sirly feels that every stakeholder should be treated equally,and that profiting at the expense of others is foolhardy. Bo,agreeing in part with Sirly,states,"We must be sensitive to all affected parties,but clearly our primary goal is to make a profit for our owners." In an attempt to resolve the conflict between Harry and Sirly,Bo offers an alternative suggestion: reduce the firm's charitable contributions until acceptable profit levels are realized.Sirly is outraged and reminds Bo of the social responsibilities that U-Scream Ice Cream has to the community,environment,suppliers,employees,and stockholders. -On which of the three "ethics check questions" would Harry primarily focus?

A firm's carbon footprint is:

Relationships between businesses and among nations,