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Multinational companies that forbid the payment of bribes and kickbacks in their codes of ethical conduct and that are serious about enforcing this prohibition


A) are generally advocates of the ethical relativism school of thought.
B) are misguided in their efforts because bribes and kickbacks are really no different from tipping for service at restaurants as you pay for a service rendered.
C) face a particularly vexing problem of losing business to competitors that have no scruples-an outcome that penalizes ethical companies and company personnel.
D) are out-of-step with business reality given that the preponderance of company managers are immoral.
E) are in a distinct minority compared to companies that view the payment of bribes and kickbacks as a legitimate or permissible practice.

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Provide at least three examples of companies that pursue sustainability strategies and explain what their activities entail.

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Sustainable business practices are those...

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In what ways do socially responsible actions and sustainable business practices result in lower costs for a company's human resource activities?

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Socially responsible actions and sustain...

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Valid business reasons for why companies should act in a socially responsible manner DO NOT include


A) generating internal benefits (such as improved employee recruiting, workforce retention, training, and worker productivity) .
B) reducing the risk of reputation-damaging incidents.
C) acting in the best interest of shareholders in terms of increased stock price and financial performance.
D) increasing buyer patronage and customer loyalty.
E) reducing the triple bottom line.

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Following public revelations of pressures on bank staff to set up fraudulent accounts in order to reach sales quotas, the CEO of Wells Fargo Bank was forced to apologize to and recompense customers for whom the bank had set up false credit card and auto loan accounts. As a consequence, over 100,000 account managers were terminated, a $186 million fine was paid to the U.S. government, the CEO was forced to resign, and the company's stock price also sharply declined. Which of the following costs did Wells Fargo incur?


A) only visible and internal administrative costs
B) visible but not intangible costs
C) internal administrative costs, tangible costs, and intangible costs
D) internal administrative costs but not visible costs
E) visible and intangible costs

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Senior executives can ensure compliance with the ethical code of conduct by considering whether


A) the proposed action is fully compliant and in harmony with the code of ethical conduct and whether stakeholders would consider anything ethically objectionable.
B) the code of conduct is rejected by the market and accepted by employees.
C) the code of conduct was accepted by rivals.
D) the creation of the code of conduct should be handled by executives or employees.
E) to eliminate the need to execute a code of conduct at all.

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Imagine you are the founder of a company that provides shelter for pets that have neither homes nor owners to return to after a major weather disaster such as a fire, hurricane, or flood. What moral case could you provide to your staff as to why your company should engage in socially responsible actions and environmentally sustainable business practices?

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The essence of the business case for why...

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Marianne has opened a jewelry shop in your community and sources precious gems and metals only from Canada rather than Africa. Her rationale for her CSR and environmentally sustainable business practices includes all of the following EXCEPT


A) increasing buyer patronage.
B) shortening the supply chain.
C) lowering costs and enhancing employee recruiting and workforce retention.
D) creating opportunities for revenue enhancement and best long-term profits for shareholders.
E) reducing her exposure to the risk of reputation-damaging incidents.

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According to integrative social contracts theory, the ethical standards a company should try to uphold


A) are governed by the school of ethical universalism.
B) should be determined by the company's board of directors.
C) should never be absolute but rather always provide some wiggle room according to the circumstances of the situation.
D) are governed by each country's Code of Required Ethical Conduct, which sets forth that each individual/group/business/organization has a "social contract" to observe the ethical and moral standards that the country has adopted.
E) are governed both by (1) a limited number of universal ethical principles that are widely recognized as putting legitimate ethical boundaries on actions and behavior in all situations and (2) the circumstances of local cultures, traditions, and shared values that further prescribe what constitutes ethically permissible behavior and what does not-but universal norms always take precedence over local ethical norms.

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Uber's scandals, tarnished reputation, loss of market share to rival companies, and the ouster of its co-founder Travis Kalanick was NOT due to


A) inadequate returns to its shareholders owing to the delay of its planned initial public offering (IPO) .
B) unfair competitive practices.
C) inadequate attention to customer safety and data privacy.
D) sexual harassment in the workplace and a toxic workplace culture.
E) price gouging during crises.

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After it came to light in 2017 that Wells Fargo employees fraudulently opened customer accounts to hit sales quotas, rehabilitating this bank's shattered reputation was expected to be time-consuming and costly because its employees' actions could


A) result in increased corporate taxes on the bank's profits.
B) lead to unnerved creditors and increased risk of default on loans due to potential business fallout.
C) result in higher stock prices and higher returns on invested capital.
D) result in the increased costs of servicing the bank's customers.
E) result in poaching talented employees from rival banks.

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If one concurs with the school of ethical universalism, then one believes that


A) many basic moral standards travel well across cultures and countries and really do not vary significantly according to local cultural beliefs, social mores, religious convictions, and/or the circumstances of the situation.
B) since ethical standards are subjectively determined, each company has a window within which it can define and implement its own ethical principles of right and wrong.
C) what is deemed right or wrong, fair or unfair, moral or immoral, ethical or unethical in business situations should be judged in light of local customs and social mores and can legitimately vary from one culture or nation to another.
D) each country should have some degree of latitude in setting its own ethical standards for judging the ethical correctness of business actions/behaviors within its borders.
E) concepts of right and wrong as they apply to business behavior are purely based on an individual's understanding of ethics and differ from person to person.

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The results of strategies that cannot pass the test of moral scrutiny often are NOT manifested in


A) sharp drops in stock prices and lower dividends.
B) devastating public relations hits.
C) sizable fines.
D) criminal indictment and convictions of company executives.
E) increased customer loyalty.

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Ben & Jerry's, Whole Foods Market, Stonyfield Farm, TOMS, Keurig Green Mountain, and Patagonia all have engaged in visible and well-publicized activities as socially conscious companies with which major result?


A) increasing buyer patronage
B) reducing the risk of reputation-damaging incidents
C) internal benefits such as improved efficiency and workforce retention
D) apparent correlations between CSR and their stock prices as well as other measures of financial performance
E) reductions of their bottom lines by unspecified and unjustifiable amounts

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In 2017, it came to light that in order to meet its demanding profit target, Wells Fargo put such pressure on its employees to hit sales quotas that many employees responded by fraudulently opening customer accounts. Wells Fargo's ethical lapses are NOT a good example of


A) how certain universal ethical principles apply in those situations where all societies-those endowed with rationality and moral knowledge-have a common moral agreement on what is right and wrong.
B) how, within the boundaries of a social contract, local cultures or groups can specify what additional actions may or may not be ethically permissible.
C) how universal ethical principles or norms leave some "moral free space" for the people in a particular country (or local culture or even a company) to make specific interpretations of what other actions may or may not be permissible within the bounds defined by universal ethical principles.
D) how universal ethical norms always take precedence over local ethical norms.
E) how local ethical norms always take precedence over universal ethical norms.

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When Robin and Rich ask for a client's financial statements in order to complete the data collection for their strategic management project, the owner of the business tells Robin that his accountants are "preparing the financials but these won't be ready for several months." The client instead suggests that Robin and Rich fabricate the financials instead, since what he "really wants is a marketing plan," and that "no one will ever know if you've seen the actual financials or not." Which of the following should NOT guide Robin and Rich in their decision whether or not to take this as an authorization to submit false data as part of their final report?


A) the pervasiveness of immoral and amoral businesspeople
B) overzealous pursuit of personal gain, wealth, and other selfish interests
C) a company or campus culture that places good business performance and good grades ahead of ethical behavior
D) heavy pressures on students to meet or beat assignment deadlines
E) their desire to complete the project, independent of their actual performance on the project

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For their final business class in college, Bill and Jill have been assigned a client that needs to improve its accounting and budgeting systems. Bill received the assignment by claiming on his résumé to have majored in accounting. His consulting partner, Jill, a marketing major, learns that he never actually passed any accounting courses. Jill is deciding whether or not to overlook the false claim, since Bill is otherwise conscientious and honorable and failure to pass the course might jeopardize his graduation. In her conversation with the instructor, which question will Jill NOT raise?


A) Would the potential outcome of the proposed action pose a risk of embarrassment?
B) Is what we are proposing to do fully compliant with our code of ethical conduct?
C) Is there anything in the proposed action that could be considered ethically objectionable?
D) Is it apparent that this proposed action is in harmony with our core values?
E) Are any conflicts or concerns evident between the proposed action and our core values?

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The essence of socially responsible business behavior is


A) balancing strategic actions to benefit shareholders against the duty to be a good corporate citizen.
B) pursuing actions to keep prices low enough that the company's profits will not be viewed by the general public as obscenely high or exorbitant.
C) making sizable contributions to political action committees representing the interests of the industry.
D) undertaking actions to balance the interests of all company stakeholders rather than just exclusively working to protect the interests of shareholders.
E) providing jobs for the local community rather than outsourcing them to low wage labor countries.

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Studies done on the correlation between good corporate behavior and good financial performance have generally found


A) no correlation.
B) a small positive correlation.
C) a small negative correlation.
D) a large positive correlation.
E) a large negative correlation.

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How are environmental sustainability initiatives part and parcel of a strategy to improve a company's "Triple-P" performance? Why is it important for strategy-makers to find points of intersection between society and the company's ability to execute value chain activities or better serve customer needs?

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At the center of the triple bottom line ...

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