Exam 9: Ethical Business Strategies, Social Responsibility, and Environmental Sustainabil ITY

A) conceal their initiatives and accomplishments in the areas of diversity, environment, community, and ethics to increase profitability.
B) make the results of their CSR strategies apparent to stakeholders and for stakeholders to hold companies accountable for their impact on society.
C) minimize transparency and facilitate benchmarking CSR efforts across firms and industries.
D) minimize the use of standard reporting frameworks and metrics.
E) attract profit-oriented investors.

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A) In a multinational company, application of ethical relativism equates to multiple sets of ethical standards.
B) There are few absolutes when it comes to business ethics and thus few ethical absolutes for consistently judging a company's conduct in various countries and markets.
C) When there are cross-country or cross-cultural differences in ethical standards, it is appropriate for ethical standards in a company's home market to take precedence over what the local ethical standards may be.
D) A company that adopts the principle of ethical relativism and holds company personnel to local ethical standards necessarily assumes that what prevails as local morality is an adequate guide to ethical behavior.
E) According to the ethical relativism school of thinking, a "one-size-fits-all" template for judging the ethical appropriateness of business actions and the behaviors of company personnel does not exist.

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C

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The strength of ethical universalism is ...

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A) It promotes greater transparency and facilitates benchmarking CSR efforts across firms and industries.
B) It promotes and establishes mutual funds investment opportunities comprised of companies that excel on the basis of the triple bottom line.
C) It promotes greater awareness of the Dow Jones World Index, which comprises companies that are engaged in environment sustainability.
D) It promotes corporate governance, climate change, and labor practices.
E) It is a nonprofit reporting organization that ranks companies on habitat protection.

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A

A) defines what is meant by ethical relativism.
B) defines what is meant by ethical universalism.
C) is the foundation of a social contract.
D) is the basis for the theory of ethical variation.
E) is the guiding principle for religious and moral standards across countries and cultures.

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A) The higher the public profile of a company or brand, the greater the scrutiny of its activities and the higher the potential for it to become a target for pressure group action.
B) Acting in a socially responsible manner nearly always results in higher profits and a higher stock price for shareholders.
C) To the extent that a company's socially responsible behavior wins applause from consumers and fortifies its reputation, a company may win additional patronage.
D) Some employees feel better about working for a company committed to improving society-a condition that can contribute to lower turnover and better worker productivity.
E) Companies with deservedly good reputations for contributing time and money to the betterment of society are better able to attract and retain employees compared to companies with tarnished reputations.

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Environmental sustainability involves de...

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A) Concepts of ethically right and ethically wrong are relative across countries and cultures but are universal within countries or cultures.
B) Individuals and businesses have a basic right to "moral free space" and it is inappropriate to specify ethically permissible and ethically impermissible actions and behaviors.
C) There are important occasions when local cultural norms and morality and the circumstances of the situation determine whether certain behaviors are right or wrong, for there are no absolutes when it comes to business ethics.
D) Concepts of right and wrong as applied to business situations are always a function of each company's own set of values, beliefs, and ethical convictions (as stated in the company's code of ethical conduct) .
E) Standards of what is ethically right and ethically wrong as applied to business behavior are determined solely by whatever business norms prevail in a particular company's home country and are applicable to its operations in all other countries.

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A) likely to be fully effective in creating a competitive advantage.
B) normally based on a corporate social agenda.
C) ambiguous and rarely make a difference in the way the company does business.
D) implausible to advance a positive, high-energy workplace environment.
E) heavily dependent on encouraging employee morality.

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A) bribing a government official to allow you to transfer gambling winnings to a tax haven
B) performing genital mutilations on nonconsenting female teens
C) employing as laborers children under the age of nine
D) agreeing to a country's policy of prohibiting the education of females
E) bribing a government official in an underdeveloped country to obtain a permit to build a hospital

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A) operate in an honorable manner, provide good working conditions for employees, and actively work to enhance the quality of life in the local communities where it operates and in society at large.
B) meet the current needs of customers, suppliers, shareholders, employees, and other stakeholders in a manner that protects the environment, provides for the longevity of natural resources, maintains ecological support systems for future generations, and guards against ultimate endangerment of the planet.
C) protect and enhance natural resources and ecological support systems, taking into account the current consumption for the current generation.
D) apply universal norms regarding the protection of the environment to its everyday operations and to function below the levels required by prevailing environmental regulations.
E) balance commonly held views about what constitutes environmentally appropriate actions against its ability to make a profit.

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A) Every action a company takes can be interpreted as a statement of what it stands for.
B) Most business leaders can be expected to acknowledge that socially responsible actions and environmental sustainability are important and that businesses have a duty to be good corporate citizens.
C) In return for society granting a business a "license to operate" and not be unreasonably restrained in its pursuit of a fair profit, a business is obligated to act as a responsible citizen and do its fair share to promote the general welfare.
D) Acting in a socially responsible manner is in the best financial interest of shareholders.
E) Every business has a duty to do what's best for shareholders while operating honorably, provide good working conditions to employees, and be a good environmental steward.

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A) is based on the principle of treating people fairly and with respect.
B) is based on the conviction that improving the well-being of society ranks higher in priority and is certainly nobler than making a profit and serving the interests of shareholders.
C) boils down to "it's the right thing to do."
D) rests on the principle that a business is duty bound to fulfill its social contract to serve the interests of all stakeholders in a business enterprise.
E) is based on the principle that business activities lack real legitimacy and have few socially redeeming qualities unless and until a company exerts a significant and sincere effort to give something back to the community.

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A company does have a duty to go beyond ...

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A) dramatic cuts in research and development expenditures in years when low earnings are reported by the company
B) increases in research and development expenditures in years when low earnings are reported by the company
C) executive commitment to implementing strategic suggestions from the board of directors
D) attracting investors who think the company's industry will grow
E) hiring and maintaining a skilled and diverse workforce

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The jury is still out on the correlation between CSR and stock price performance and competitive advantage. Corporate social agendas that address generic social issues may help boost a company's reputation, but it is still not yet conclusive whether or not they contribute to improving its competitive strength in the marketplace. For example, a two-year study of leading companies found that improving environmental compliance and developing environmentally friendly products enhance earnings per share, profitability, and the likelihood of winning contracts. Also, the stock prices of companies that rate highest on social and environmental performance criteria have been found to perform 35 to 45 percent better than the average of the 2,500 companies comprising the Dow Jones Global Index, Finally, a review of some 135 studies indicated there is a positive, but small, correlation between good corporate behavior and good financial performance; only 2 percent of the studies showed that dedicating corporate resources to social responsibility harmed the interests of shareholders.

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From a company's business practices pers...

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A) They are ethical principles that set forth the traits and behaviors considered virtuous and that a good person is supposed to believe in and display.
B) They are ethical principles embodied in international law that all societies and countries are obliged practice.
C) All societies and countries apply essentially the very same set of universally defined ethical principles of right and wrong in judging the ethical correctness of business behavior.
D) It is mandatory that the standards of what's ethical and what's unethical be applied universally to all businesses in all countries irrespective of local business traditions and local business norms.
E) The standards of what constitutes ethical and unethical behavior in business situations are partly universal, but in the main are governed by local business norms.

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