chapter 7 - ethics-Quiz

Introduction

• Each subject uses specific terms
• Different meanings in other contexts
• Common terms in Business Ethics

Agency

• Belief one has power to change
• Critical in decisions as most people will only report if they believe their action can make a difference

Aspirational

• Strong desire to achieve great things
• Code intended to aim higher than mere compliance with the law

Benchmarking

• Comparing to established best practices, peer organizations or past results to understand strengths, challenges & progress

Business Ethics

• Conduct by which companies abide by the law & respect stakeholder rights (customers, clients, employees & community)

Capacity Building

• Developing organizational core skills (leadership, management, finance & fundraising) & capabilities
• Programs & evaluation to build effectiveness & sustainability

Code of Conduct

• Listing required behaviors with disciplinary action for violation
• Used interchangeably with Code of Ethics

Code of Ethics/Conduct

• Central guide for decision-making
• Clarifies mission, values & principles, linking them to standards of professional conduct

Code Provisions

• Specific standards of behavior and performance
• Expectations of the organization to highlight & address

Compliance

• Extent a company conducts business operations in accordance with regulations & statutes

Comprehensive Ethics & Compliance Program

• Six key elements: standards, training, company resources, confidential reporting, performance evaluations, and disciplinary systems for violators
• Includes guiding values & principles

Conflict of Interest

• Exists when a person entrusted to exercise judgment on behalf of others, also has interests or obligations which could interfere with judgment
• Should either be avoided or acknowledged openly

Corporate Culture

• Shared beliefs, values & behaviors forming organizational context where employees & managers interact

Corporate Social Responsibility

• Business views itself within a broader context with implicit social obligations
• Responsibility for business's effects on environmental and social well-being

Corruption

• Abuse of public power for private benefit
• Perversion of integrity in public duties, through bribery or favor, or corrupt practices

Courage

• Choosing to do what's right regardless of the result

Credo

• Fundamental beliefs or guiding principles

Deontology

• Ethical theory focusing on rights and duties owed to others

Effective (or Well-Implemented) Ethics and Compliance Program

• Living part of a company's ethos with ethical conduct & support for employees to uphold standards
• Six hallmarks: freedom to question management, rewards, no rewards for questionable actions, positive feedback, employee preparedness to address misconduct, employee willingness to seek ethics advice

Empathy

• Caring about consequences of choices affecting others
• Being concerned with the impact on those without a say in the decision

Ethical Congruence

• Decision consistent with applicable values
• Harmonizing with values and perceptions

Ethical Decision Making

• Involves ethical considerations
• Considering impact e.g., impact on others and relationships/ determination of the right thing to do

Ethical Differences

• Situations where individuals agree on a value but disagree on the action

Ethical Dilemmas

• Challenging situations requiring conflicting values

Ethical Relativism

• Ethics depends entirely on context, with standards varying by personal and professional lives

Ethics Culture

• Extent to which employees uphold values & standards
• Includes ethical leadership, supervisor reinforcement & peer commitment

Ethics Risk

• Potential harm from misconduct which goes undetected

Focus Group

• Small group representing a larger population to share opinions & experiences
• Used to gather information for organizational culture assessments

Good Faith

• Belief in the accuracy of reported information

Goodwill

• Business value beyond tangible assets
• Includes reputation, brand attitude, workforce and customer relations

Governance

• Act, process or power exercising authority in an organizational setting

Independence

• Freedom to act without control from others

Integrity

• Adherence to moral values ensuring trustworthiness and incorruptibility

Long-term Perspective

• Broad view of profit maximization recognizing that decisions impact the long run

Maxims

• Short, pithy statements used to instruct and guide behavior

Morals

• Values or beliefs defining right/wrong and good/bad
• Typically derived from a higher authority

Normative Ethical Theories

• Philosophical theories describing how people should behave based on reason

Ombudsman

• Neutral/impartial dispute resolution to assist managers/employees/clients with confidential informal assistance

Outcomes

• Results of actions taken
• Expected ethical outcomes are reduced misconduct, increased rate of reporting, and decrease in retaliation for whistleblowing

Qualitative Data

• Descriptive data, not numerical
• Collected through focus groups, interviews & open-ended questions

Quantitative Data

• Numerical data easily compared
• Collected through surveys

Reporter

• Employee observing workplace misconduct and informing an appropriate authority

Reporting System

• Mechanism (e.g., helpline, hotline or website) for agents to report misconduct without fear

Reputational Risk

• Potential harm from loss of stakeholder trust

Rules-Centered Code of Conduct

• Listing of behavioral requirements with disciplinary actions for violations

Sample

• Small selection representing the whole
• Can be randomly selected or stratified

Security

• Belief in the safety and position as a driving factor in employee reporting

Stakeholder

• Individual/institution owning stock or shares in corporation

Short-term Perspective

• Focus on goal of maximizing periodic profits (e.g., quarterly or annual)

Social Contract

• Implicit agreement where members cooperate for social benefit
• Businesses have responsibility to give back to the society that allows their operations

Stakeholders

• Individuals/entities affected by a business's decisions, including customers, suppliers, investors, employees, the community, and the environment

Sustainability

• Maintaining a state or condition over an indefinite period

Survey

• Set of questions to examine a condition, situation, or value

Transparency

• Sharing information and acting openly
• Mechanisms and processes being visible, predictable, and understandable

Utilitarianism

• Normative theory where ethical acts maximize good for the greatest number of people

Values

• Core beliefs regarding right and fair actions and interactions with others

Values-Centered Code of Ethics

• Set of principles grounding in ideals (such as integrity, trustworthiness)

Virtue Theory

• Normative theory emphasizing proper conduct guided by our upbringing

Whistleblower

• Employee reporting observed misconduct