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Q:
(p. 72) The difference between old social contract approach to corporate management and modern social contract approach is that the:
A. old social contract emphasizes advancement in the quality of life, whereas the modern social contract approach emphasizes economic advancement.
B. old social contract approach argues that there is an obligation for the corporation to meet the demands of the society, whereas the modern social contract approach argues a company's obligation is only to its shareholders.
C. modern social contract approach focuses on the delivery of quarterly earnings numbers, short-term perspective, whereas the old social contract focuses on maintaining a longer-term perspective.
D. modern social contract approach aims to the meet the demands of all stakeholders and the shareholders, whereas the old social contract approach was based only on economic growth.
Q:
(p. 72) Which of the following statements is true of the social contract approach to corporate management?
A. The primary focus of the old social contract laid emphasis on equal advancement in the quality of life and economic growth.
B. The modern social contract approach argues that there is an obligation for the corporation to meet the demands of the society rather than just the demands of a targeted group of customers.
C. The consequences of the modern social contract approach to corporate management is growth at the expense of rising costs, wages growing at a lower rate than inflation, and so on.
D. The main focus of the old social contract was to maintain a longer-term perspective than just the delivery of quarterly earnings numbers.
Q:
(p. 72) Hoffmann Enterprises (HE), a manufacturer of industrial goods, primarily focuses on meeting the demands of the market with quality products. It also undertakes environmental protection endeavors that promote the use of renewable sources of energy. HE illustrates the _____ to corporate management.
A. free-enterprise approach
B. instrumental approach
C. shareholder approach
D. social contract approach
Q:
(p. 72) Which of the following best illustrates the social contract approach to corporate management?
A. Indibean Inc. promotes extensive work shifts.
B. Armac Inc. asks its employees to work on holidays to increase profits.
C. At Clark Enterprises there have been substantial layoffs to control costs.
D. At Redder Enterprises, employees' wages have grown at a higher rate than inflation.
Q:
(p. 72) The _____ to corporate management refers to the perspective that a corporation has an obligation to society over and above the expectations of its shareholders.
A. social contract approach
B. shareholder approach
C. free-enterprise approach
D. instrumental approach
Q:
(p. 71) Which of the following approaches to corporate management is considered simplistic because it assumes that there are no external consequences to the actions of a corporation?
A. The shareholder approach
B. The social contract approach
C. The free-enterprise approach
D. The instrumental approach
Q:
(p. 71-72) The _____ to corporate social responsibility assumes that there are no external consequences to the actions of the corporation and its managers.
A. instrumental approach
B. shareholder approach
C. free-enterprise approach
D. social contract approach
Q:
(p. 71) Which of the following statements is true of Milton Friedman's view of the corporate world?
A. Friedman argues that it would be unethical for a corporation to just deliver the profits to its investors rather than giving something back to the society.
B. Friedman's position illustrates that an organization has a social responsibility that goes beyond serving the interests of their stockholders.
C. Friedman stipulates that profits can be earned "with deception or fraud."
D. Friedman argues that, as an employee of the corporation, a manager has an ethical obligation to fulfill his role in delivering on the expectations of his employers.
Q:
(p. 71) Which of the following companies implements Milton Friedman's view of the corporate world?
A. A company that donates a certain portion of profit to an organization for underprivileged children.
B. A company that makes as much profit as possible to ensure that the investments made by the company are successful.
C. A company that stipulates that profits should be earned at any cost, be it deception or fraud.
D. A company that believes its social responsibility is beyond serving the interests of its stockholders.
Q:
(p. 71) Spark Inc. (SI), a multinational corporation, had reported large losses in the previous financial year. To overcome these losses, the company planned to take the instrumental approach to corporate management. Which of the following best illustrates this approach?
A. SI provides employees with healthy meals and has a gymnasium at the workplace.
B. SI provides employees with cab facility or gives them fuel allowance.
C. SI uses its resources to enhance the productivity of employees and thus increases profits.
D. SI uses biodegradable plastic containers in its office cafeteria.
Q:
(p. 71) Which of the following is an example of an organization's instrumental approach to corporate social responsibility (CSR)?
A. Anonymous Minds, an advertising firm, provides employees with healthy meals and has a gymnasium at the workplace.
B. Anderson Inc. provides employees with cab facility or gives them fuel allowance.
C. Larsen's Corp., an investment company, uses different mechanisms to increase profits and has performance incentives for its employees.
D. GreenSpin Inc. uses biodegradable plastic containers in its office cafeteria.
Q:
(p. 71) The instrumental approach to corporate social responsibility (CSR) states that:
A. the only obligation of a corporation is to promote socialist economic planning.
B. a corporation has an obligation to society over and above the expectations of its shareholders.
C. the only obligation of a corporation is to maximize profits for its shareholders.
D. a corporation has an obligation to the community and environment.
Q:
(p. 70) Which of the following statements is true of corporate social responsibility (CSR)?
A. The social contract approach to CSR states that the only obligation of a corporation is to maximize profits for its shareholders.
B. Many companies awoke to CSR only after being surprised by public responses to issues they had not previously thought were part of their business responsibilities.
C. The instrumental approach to CSR states that a corporation has an obligation to society over and above the expectations of its shareholders.
D. An organization's discovery of the significance of CSR is never intentional; it is always a result of unexpected media attention.
Q:
(p. 70) Corporate social responsibility assumes that the corporation:
A. is operating in a competitive environment.
B. is committed to follow a retrenchment strategy exclusively.
C. is permitted to ignore federal and state legal obligations.
D. is exclusively committed to a moderate growth strategy.
Q:
(p. 70) Which of the following illustrates that a company has failed at implementing corporate social responsibility (CSR)?
A. The company does not provide stock options for its employees.
B. The company does not pay all taxes related to the profitable business operations.
C. The company does not operate in hazardous working environments.
D. The company does not provide flexible working hours to its employees.
Q:
(p. 70) In addition to achieving social benefits, which of the following best illustrates that a company is effectively implementing corporate social responsibility (CSR)?
A. The company provides its employees free lunch
B. The company allows flexible working hours for its employees
C. The company gives better pricing deals to older clients
D. The company fulfills its legal obligations
Q:
(p. 70) Happy Times (HT) is an alcohol manufacturing brand that manufactures and sells several types of alcoholic beverages. HT uses social media for promoting the message of responsible drinking. It sponsors the FreeTaxi program for customers with HT membership on Christmas and New Year's Eve. It has also initiated several community welfare projects where a percentage of the profits go to the Hunger Relief Fund for Children. Which of the following aspects of Happy Times is illustrated in this scenario?
A. Virtue ethics
B. Universal ethics
C. Corporate governance
D. Corporate citizenship
Q:
(p. 70) Which of the following is an example of corporate social responsibility?
A. Brenner Enterprises gives its employees greater freedom in choosing projects.
B. Dawson Inc. uses clean-fuel technology shuttle for employee conveyance.
C. Larsen Inc. provides free lunch coupons to its employees.
D. Infinite Corp. promotes team building activities for employees.
Q:
(p. 70) _____ refers to the actions of an organization that are targeted toward achieving a social benefit over and above maximizing profits for its shareholders and meeting all its legal obligations.
A. Value chain
B. Virtue ethics
C. Corporate conscience
D. Circles of sustainability
Q:
(p. 81) The Chicago Climate Futures Exchange (CCFE) promotes the standardization of carbon trading on a global scale.
Q:
(p. 80) The Kyoto Protocol requires developed nations to reduce their greenhouse gas emissions only by modifying their domestic industries.
Q:
(p. 80) The practice of making operations "carbon neutral" is a way to offset whatever damage is being done to the environment due to greenhouse gas emissions by purchasing credits from "carbon-positive" projects to balance out emissions.
Q:
(p. 79) Emissions credits are fixed for every market, and they cannot be bought or sold.
Q:
(p. 79) The practices of making a company's operations "carbon neutral" was initially developed as a solution for those industries, such as airlines or automobile companies, that face significant challenges in reducing their emissions.
Q:
(p. 79) One of the newest and increasingly questionable practices in the world of CSR is the notion of making operations "carbon neutral."
Q:
(p. 79) In contrast to the alleged immorality of altruistic CSR, critics argue that strategic CSR is ethically commendable since these initiatives benefit stakeholders while meeting fiduciary obligations to the company's shareholders.
Q:
(p. 79) Strategic CSR targets programs that will generate the most positive publicity or goodwill for the organization.
Q:
(p. 79) Strategic CSR runs the greatest risk of being perceived as self-serving behavior on the part of the organization.
Q:
(p. 79) Altruistic CSR type of philanthropic activity targets programs that will generate the most positive publicity or goodwill for the organization.
Q:
(p. 78) The country of Cadmia was hit by a hurricane. Singerz Corporation responded to the devastation caused by the hurricane by donating fuel for transportation supplying relief aid. In addition, it announced direct cash donation of $1 million to support the relief and rebuilding efforts. This is an example of strategic corporate social responsibility (CSR).
Q:
(p. 78) Critics have argued that, from an ethical perspective, altruistic CSR is immoral since it represents a violation of shareholder rights if they are not given the opportunity to vote on the initiatives launched in the name of corporate social responsibility.
Q:
(p. 78) Altruistic CSR represents a type of corporate social responsibility (CSR) in which organizations pursue a clearly defined sense of social conscience in managing their financial responsibilities to shareholders, their legal responsibilities, and their ethical responsibilities to do the right thing for all their stakeholders.
Q:
(p. 78) Ethical CSR is a philanthropic approach to corporate social responsibility in which organizations underwrite specific initiatives to give back to the company's local community or to designated national or international programs.
Q:
(p. 78) Ethical CSR is the purest or most legitimate type of CSR.
Q:
(p. 78) There are four distinctive types of corporate social responsibility (CSR)economic, ethical, altruistic, and strategic.
Q:
(p. 77) Anderson Enterprises (AE) issues free meal coupons to its employees and also provides them with travel allowances. This illustrates that AE pursues the triple bottom-line approach.
Q:
(p. 77) There are several standard ways to measure the achievements of the triple bottom-line approach.
Q:
(p. 75) Corporations merely experimenting with corporate social responsibility initiatives run the risk of creating adverse results as the public sees little more than a token action that is concerned with publicity rather than community.
Q:
(p. 75) All CSR initiatives invariably generate immediate financial gains to the organization after implementation.
Q:
(p. 75) Organizations find it easy to make the transition from corporate social responsibility (CSR) as a theoretical concept to CSR as an operational policy due to the major trends driving it.
Q:
(p. 75) U.S. citizens consider the public sector as the most appropriate venue for addressing a growing list of social problems.
Q:
(p. 75) Globalization represents a new stage of capitalist development, this time with public institutions in place to protect society by balancing private corporate interests against broader public interests.
Q:
(p. 75) With the transition to an information-based economy, consumers and investors have more information at their disposal than at any time in history.
Q:
(p. 73) Transparency is a major trend behind the corporate social responsibility phenomenon.
Q:
(p. 73) Joseph F. Keefe asserts that there are three major trends behind the corporate social responsibility phenomenon.
Q:
(p. 73) The policy of "doing well by doing good," refers to the belief that doing good for the company is just good business.
Q:
(p. 73) Doing what's in the best long-term interest of the customer invariably fails to achieve what's best for the company.
Q:
(p. 72) Layoffs reduce corporation costs and only affects the laid-off employees.
Q:
(p. 72) Henry Ford II recognized the fact that corporations operate in an isolated environment.
Q:
(p. 72) The social contract approach to corporate management is the perspective that the only obligation of a corporation is to maximize profits for its shareholders in providing goods and services that meet the needs of its customers.
Q:
(p. 72) The social contract approach is a very simplistic model that argues that the corporation only has an obligation to itself.
Q:
(p. 71) The instrumental approach is a simplistic model that focuses on the internal world of the corporation.
Q:
(p. 71) Friedman's view of the corporate world supports the rights of individuals to make money with their investments.
Q:
(p. 71) Instrumental approach to corporate management is the perspective that a corporation has obligation to society over and above the expectations of its shareholders.
Q:
(p. 70) Extabet Enterprises donates a certain percentage of their profit to local charities, but it does not comply with all the legal industry standards of operating in a safe working environment. This depicts corporate social responsibility.
Q:
(p. 70) The employees of Brennerz Inc. are encouraged to cycle to work every day to reduce environmental pollution. This is an example of corporate social responsibility.
Q:
(p. 70) Apart from achieving a social benefit over and above maximizing profits for its shareholders, corporate social responsibility also requires an organization to meet all its legal obligations.
Q:
(p. 70) Corporate citizenship is an element of corporate social responsibility.
Q:
(p. 70) Corporate Social Responsibility (CSR) refers to the actions of an organization that are targeted toward achieving a social benefit over and above maximizing profits for its shareholders and meeting all its legal obligations.
Q:
(p. 48) Anderson Enterprises endorses low power distance which implies that the firm lays emphasis on a less consultative or democratic work structure. Subordinates work on important assignments and managers often socialize with them. Which of the following concepts is being reflected in the above scenario?
A. Ethical relativism
B. Value chain
C. Organizational culture
D. Corporate conscience
Q:
(p. 48) Which of the following statements is true of organizational culture?
A. Organizational culture represents only the written policies and procedures of an organization.
B. Organizational culture includes the values, beliefs, and norms shared by all employees of that organization.
C. Employees' personal value system is always in tune with the ethical standards of the organization's operating culture.
D. Stakeholders lack interest in the ethical performance of an organization.
Q:
(p. 48) An organizational culture:
A. represents the sum of all the policies and procedures from each of the functional departments in the organization.
B. represents the process of transformation in every organization.
C. refers to the ideology that promotes diversity in different institutions.
D. refers to the characteristic of publicly committing to the highest professional standards and sticking to that commitment.
Q:
(p. 59) Profits are the main reason behind stretching the truth and bending the rules on a regular occurrence in the workplace.
Q:
(p. 59) Nonprofit organizations do not face problems with unethical behavior.
Q:
(p. 58) Selling a product that has the potential to be harmful to a firm's customers represents a significant conflict of interest.
Q:
(p. 58) A situation in which one relationship or obligation places the individual or firm in direct conflict with an existing relationship or obligation refers to a conflict of interest.
Q:
(p. 58) The obligation that an auditing firm has to a paying client while owing an objective, third-party assessment of that client's financial stability to stakeholders and potential investors represents a potentially significant conflict of interest.
Q:
(p. 57) When a company's financial statements have been certified by an objective third party to be "clean," that certification is meant to be for the public's benefit rather than the company's.
Q:
(p. 56) Some of the illegal financial functions include underreporting income, overvaluing assets, and taking questionable deductions.
Q:
(p. 56) It is illegal to defer receipts from one quarter to the next to manage tax liabilities.
Q:
(p. 56) The accounting profession is governed by a set of laws and established legal precedents.
Q:
(p. 55) The auditing function keeps track of all the company's financial transactions by documenting the money coming in and money going out and balancing the accounts at the end of the period.
Q:
(p. 54) The accounting function provides the certification, by an impartial third-party professional, that an organization's financial statements are accurate.
Q:
(p. 54) The human resource function of an organization can be divided into two distinct areas: financial transactions and accounting function.
Q:
(p. 54) Marketing professionals are responsible for ensuring that the right programs and policies for ethical business conduct are in place.
Q:
(p. 54) HR professionals must help ensure that ethics is a top organizational priority.
Q:
(p. 54) HR must ensure that the leadership selection and development processes include an ethics component.
Q:
(p. 54) The advocates of ethical business conduct argue that HR should be the sole creator of any corporate code of ethics.
Q:
(p. 54) The advocates of ethical business conduct argue that HR should be at the center of any corporate code of ethics.
Q:
(p. 53) The human resource function within an organization seldom needs to be involved in the relationship between the company and the employee.