Business Ethics: Principles and Conduct

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Questions and Answers

Which of the following is the primary purpose of a code of ethics within an organization?

To provide detailed legal advice to employees facing ethical dilemmas.
To maximize short-term profits by any means necessary.
To guarantee that the organization will never face any ethical challenges.
To establish clear standards of expected behavior for all individuals within the organization. (correct)

Declaring bankruptcy to cancel a labor contract and cut wages is considered ethical behavior.

False (B)

List three elements necessary for fraud to occur.

Untrue representation of a fact, belief by the victim, loss suffered by victim.

A code of ethics informs every person in the organization as to the expected ________ of behaviour.

standard Signup and view all the answers

Match each element to its corresponding description in the context of determining if fraud has occurred:

Untrue representation of fact = A false statement presented as true. Belief by the victim = The victim accepts the misrepresentation as reliable. Action upon untrue representation = The victim makes a decision or takes action based on the false statement. Loss suffered by the victim = The victim incurs damages, such as financial or property loss, as a result of the fraudulent action. Signup and view all the answers

Which of the following best describes the primary function of a code of ethics within a business?

To provide guidelines for ethical conduct and promote confidence in the business. (D) Signup and view all the answers

A company's code of ethics is primarily for external stakeholders and has little impact on internal operations.

False (B) Signup and view all the answers

Define 'ethics' in the context of business.

Ethics in business refers to a set of moral principles that guide conduct, distinguishing between right and wrong behavior within a professional setting. Signup and view all the answers

Good corporate governance deals with the manner in which a business is ______.

run Signup and view all the answers

Why might business professionals sometimes deviate from ethical conduct, despite knowing the right course of action?

To gain a competitive advantage or finalize a deal. (A) Signup and view all the answers

Match the stakeholder with their primary concern regarding a company's ethical behavior:

Employees = Fair treatment and safe working environment Customers = Honest representation of products/services Shareholders = Sustainable profitability and responsible governance Community = Environmental responsibility and social impact Signup and view all the answers

A company discovers a flaw in its product that poses a minor safety risk. According to ethical principles, what should the company do?

Disclose the flaw to customers and offer a remedy. (D) Signup and view all the answers

A company demonstrating ethical behavior is solely focused on adhering to legal requirements.

False (B) Signup and view all the answers

Which principle of ethics emphasizes that leaders should ensure their actions align with the code of ethics?

Leadership (B) Signup and view all the answers

Transparency in ethical practices means concealing decisions to avoid potential misunderstandings.

False (B) Signup and view all the answers

What does accountability in an organization entail?

Taking responsibility for actions. Signup and view all the answers

Handling all people and situations objectively and without bias relates to the ethical principle of ______.

fairness Signup and view all the answers

Which ethical principle requires businesses to use resources in a way that they can be replenished?

Sustainability (A) Signup and view all the answers

What is the primary expectation for those responsible for managing a business, according to the principles of ethics?

To behave in a conscientious and trustworthy manner. (A) Signup and view all the answers

Discipline within an organization is optional and only necessary when convenient for management.

False (B) Signup and view all the answers

How does transparency contribute to an organization's ethical environment?

By openly sharing decisions to promote trust. (C) Signup and view all the answers

Flashcards

Code of Ethics

A document outlining an organization's values, ethics, and expected standards of behavior.

Unethical Behavior

Actions that violate accepted moral principles and organizational standards.