CSR Exam

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Questions and Answers

What is a key component of contemporary CSR strategies?

Link to value creation (correct)

Reactive approach

Distribution of created value

Focus on risk

What is the term used to describe CSR as a distinct activity of companies in the US?

Reactive CSR

Implicit CSR

Explicit CSR (correct)

Traditional CSR

What does the acronym ESG stand for?

Ethical, Sustainable, Green

Environmental, Sustainable, Growth

Environmental, Social, Governance (correct)

Economic, Social, Governance

What is a core component of the academic understanding of sustainability?

Balancing inter and intra-generational justice Signup and view all the answers

What ways can companies contribute to social welfare?

Providing goods and services Signup and view all the answers

What does the term 'stakeholder' refer to in the context of stakeholder theory?

Groups and individuals impacted by a company's actions Signup and view all the answers

According to Milton Friedman, what is the social responsibility of business?

To increase profits Signup and view all the answers

Which ethical philosopher is associated with the concept of the categorical imperative?

Immanuel Kant Signup and view all the answers

Which aspect of business ethics is moral imagination most directly beneficial for?

Developing innovative solutions to complex ethical dilemmas Signup and view all the answers

What term describes a company that only hires individuals under 35 years old?

Ageism Signup and view all the answers

The phrase 'race to the bottom' in business refers to what?

Countries competing for foreign investment by reducing social and environmental standards Signup and view all the answers

According to Carroll, corporate social responsibility can be categorized into which four aspects?

Economic, Legal, Ethical, and Philanthropic Signup and view all the answers

What is the term used for the acknowledgment and visibility of corporate decisions and policies to stakeholders?

Corporate Transparency Signup and view all the answers

Under ethical absolutism, how are objective moral principles regarded?

They are universally applicable and determined rationally Signup and view all the answers

What insight did the Milgram Studies provide?

They illuminated human obedience to authority figures Signup and view all the answers

What is the key difference between shareholder activism and socially responsible investing (SRI)?

Shareholder activism focuses on specific issues, while SRI considers multiple ethical factors Signup and view all the answers

What distinguishes unemployment from misemployment?

Unemployment refers to being without a job, while misemployment refers to being employed in a job that does not match one's skills or interests Signup and view all the answers

What does the term 'glass ceiling' specifically refer to?

A barrier that prevents women from advancing to senior management positions Signup and view all the answers

What is one key ethical issue related to employee monitoring?

It may violate employee privacy Signup and view all the answers

What ethical problem is commonly associated with workplace discrimination?

It creates an unfair advantage for certain groups Signup and view all the answers

What social issue does the 'Brown Eyes, Blue Eyes' experiment aim to highlight?

The impact of social conditioning on prejudice Signup and view all the answers

What is a critical ethical concern regarding Airbnb's operations in local communities?

Destruction of the housing market Signup and view all the answers

What scope does procedural justice cover compared to distributive justice?

Procedural justice emphasizes the fairness of the process, while distributive justice emphasizes the fairness of the outcome Signup and view all the answers

What are the implications of a gig economy structure?

Temporary work arrangements Signup and view all the answers

How can companies evaluate the morality of their operations in new markets?

By conducting human rights impact assessments Signup and view all the answers

What is a potential downside of globalization for multinational corporations regarding labor standards?

Race to the bottom in social standards Signup and view all the answers

What was the ethical concern in the Tide Pod case?

Product safety Signup and view all the answers

What is a primary goal of microcredit programs?

To offer financial services to low-income individuals Signup and view all the answers

What aspect of the gig economy raises concerns about worker rights?

It often results in lack of protections and benefits Signup and view all the answers

What defines an individual who works for a company, but is not regarded as an employee?

A contractor Signup and view all the answers

What is a key ethical issue in inclusive marketing?

Representing all demographics Signup and view all the answers

How is greenwashing defined in corporate ethics?

Misleading consumers about the actual environmental benefits of products Signup and view all the answers

What is a common ethical issue associated with pricing in marketing?

Price fixing Signup and view all the answers

What are the ethical problems associated with targeting vulnerable consumers?

All of the above Signup and view all the answers

What are some ethical issues in marketing communications?

Deception Signup and view all the answers

What are some moral complications of contemporary consumerism?

Reinforcing stereotypes Signup and view all the answers

What is the 'circular economy' and how does it relate to supply chains?

A business model that aims to reduce waste by reusing and recycling materials therein Signup and view all the answers

What is the main goal of the Fair Trade movement?

To protect the rights of workers in developing countries Signup and view all the answers

What is the 'triple bottom line' concept and how does it apply to sustainable supply chains?

It emphasizes the importance of considering economic, social, and environmental factors Signup and view all the answers

What is a 'Global Production Network'?

A network of firms, suppliers, and competitors interconnected through global distribution Signup and view all the answers

Which tactic is commonly associated with radical Civil Society Organizations (CSOs)?

Boycotts Signup and view all the answers

What is the primary goal of a 'buycott' in relation to consumer behavior?

To encourage consumers to support better products Signup and view all the answers

What is the 'Race to the Bottom' phenomenon?

A competition among countries to attract foreign investment by lowering standards Signup and view all the answers

What are the potential drawbacks of 'choice editing' as a strategy for promoting sustainable consumption?

It can lead to higher prices for consumers Signup and view all the answers

What defines the main purpose of Civil Society Organizations (CSOs)?

To promote specific interests, causes, or goals Signup and view all the answers

What does the term 'Social License to Operate' imply in business contexts?

Community acceptance of a company's activities Signup and view all the answers

What is the role of consumers in promoting ethical and sustainable supply chains?

All of the above Signup and view all the answers

Which of the following is NOT a stakeholder in a company's supply chain?

Employees of the company's competitors Signup and view all the answers

What is a significant drawback for CSOs that engage closely with businesses?

Compromised independence Signup and view all the answers

Which statement accurately describes the government's role concerning businesses?

To act as a stakeholder with its own interests Signup and view all the answers

How do CSOs typically represent the interests of stakeholders?

By advocating for the needs of individual and non-human stakeholders Signup and view all the answers

What is the primary objective of regulations in the business sector?

To control and influence business behavior Signup and view all the answers

Which of the following is NOT typically considered a function of policy instruments?

Promoting competition among all suppliers Signup and view all the answers

In the context of business and government, what is a major issue related to corruption?

Businesses influencing government policies through improper means Signup and view all the answers

What describes the concept of market failures?

Inefficient distribution of goods and services in a competitive market Signup and view all the answers

What ethical issue arises from Juan's decision to construct a swimming pool for Santiago?

Making a decision influenced by unethical bribes Signup and view all the answers

Which of the following presents a strong utilitarian argument against building Santiago's pool?

It undermines public trust in the local economy Signup and view all the answers

How is the Kantian ethical perspective relevant to Juan's dilemma?

It advocates for adherence to moral duties and universal principles Signup and view all the answers

What differentiates business-to-business (B2B) relationships from business-to-government (B2G) interactions?

B2G relationships are typically more influenced by political factors than B2B Signup and view all the answers

The statement that something ethical must also be legal is best described as:

Not true, as legality does not determine ethicality Signup and view all the answers

What is the purpose of a human rights impact assessment in the business sector?

To evaluate potential human rights risks and impacts Signup and view all the answers

What is the main criticism of ethical egoism?

It prioritizes self-interest over the interests of others Signup and view all the answers

Which ethical theory involves the 'veil of ignorance' concept?

Social Contract Theory Signup and view all the answers

How does the ethics of rights differ from Kantian ethics?

It is based on pre-established rights rather than duties derived from the categorical imperative Signup and view all the answers

Which ethical theory justifies actions that benefit the majority but harm a minority?

Utilitarianism Signup and view all the answers

According to deontology, what determines the morality of an action?

The adherence to moral rules or duties Signup and view all the answers

What is ethical absolutism?

Morality is based on universally applicable principles Signup and view all the answers

What is the 'agentic state' in the context of obedience to authority?

A state where individuals see themselves as executing orders rather than acting on personal responsibility Signup and view all the answers

What is the main ethical dilemma faced by the engineers in the Volkswagen Emissions Scandal?

Balancing their loyalty to their company with their responsibility to the public Signup and view all the answers

What is the main focus of descriptive ethical theory?

How ethical decisions are actually made in businesses Signup and view all the answers

What is 'groupthink'?

A phenomenon where groups make decisions based on consensus, even if it is irrational Signup and view all the answers

What is the main implication of the 'Friedman-Freeman debate' for ESG investing?

It highlights the tension between shareholder interests and stakeholder interests Signup and view all the answers

What is the main difference between a traditional for-profit company and a steward-owned company?

A steward-owned company is more focused on social responsibility Signup and view all the answers

Which of the following is NOT a right of shareholders?

The right to determine the company's strategy Signup and view all the answers

What is a key concern regarding ESG ratings?

The overemphasis on financial performance over ethical considerations Signup and view all the answers

What is the main argument for shareholder democracy?

Shareholders are the ultimate owners of the company and should have a say in its governance Signup and view all the answers

Study Notes

Key Concepts in Business Ethics and CSR

Contemporary CSR strategies: Crucial component is the link to value creation.

Carroll's CSR Pyramid

Responsibilities: Economic and legal responsibilities are foundational elements of Carroll's pyramid.

CSR in the US

Explicit CSR: Defined as a distinct corporate activity differentiating it from implicit forms of social responsibility common in other nations.

ESG

ESG Acronym: Environmental, Social, and Governance.

Sustainability

Core Component: Balancing inter- and intra-generational justice is a key component of academic sustainability understanding.

Company Contribution: Providing goods and services is a primary way companies contribute to social welfare.

Stakeholder Theory

Stakeholders: Groups and individuals impacted by a company's actions are considered stakeholders.

Legal Status of Corporations

Legal Personhood: Corporations are typically regarded as artificial persons under the law.

Definition: Ongoing acceptance of a company's practices by stakeholders constitutes its social license to operate.

Friedman's View on Business Responsibility

Profit Maximization: Milton Friedman believed the social responsibility of business is to increase profits.

Difference Principle: The difference principle in social contract theory aims to benefit the least advantaged in society.

Ethical Theories

Consequentialism: Focuses on the consequences of actions.
Deontology: Centers on adhering to moral rules or duties.
Virtue Ethics: Emphasizes the character of the person acting.
Ethics of Rights: Emphasizes pre-established rights, rather than duties.
Utilitarianism: Justifies actions that benefit the majority.
Ethical Absolutism: Morality is based on universally applicable principles.
Ethical Egoism: Prioritizes individual self-interest over the interests of others.
Social Contract Theory (again): Underlies the concept of the 'veil of ignorance.'

Obedience to Authority

Agentic State: A state where individuals see themselves as executing orders rather than acting on personal responsibility.

Ethical Decision-Making

Rest's Model: Does not include Moral Imagination as a stage.

Volkswagen Emissions Scandal

Ethical Dilemma: Balancing loyalty to the company with responsibility to the public.

Descriptive Ethical Theory

Focus: How ethical decisions are made in businesses.

Decision-Making Biases

Groupthink: A bias where groups make decisions based on consensus, even if it is irrational.

Friedman-Freeman Debate

Stakeholder vs. Shareholder: Highlights tension between shareholder interests and stakeholder interests.

Steward-Owned Companies

Focus: Steward-owned companies prioritize social responsibility over profit maximization.

Shareholder Rights

Shareholder Management Rights: Shareholders cannot determine company strategies.

Globalization and Financial Markets

Ethical Issues: Potential for money laundering, worker exploitation, financial instability, and unfair competition.

ESG Ratings

Concerns: Lack of transparency, standardization, and verification of information.

Shareholder Democracy

Right and Ownership: Shareholders are the ultimate owners of the company and should have a say in its governance.

Shareholder Activism vs. SRI

Engagement: Shareholder activism focuses on specific issues while socially responsible investing (SRI) considers multiple ethical factors.

Unemployment and Misemployment

Definition: Unemployment is the lack of a job, while misemployment is having a job that doesn't fit skills or interests.

Meaningful Work and Employee Well-being

Connection: Meaningful work contributes to positive impacts on communities, productivity, engagement, and overall well-being.

Glass Ceiling

Barrier: A barrier preventing women and other underrepresented groups from advancing to senior management positions.

Workplace Discrimination

Ethical Problems: Leads to legal consequences, unfair advantages, and hindering talent attraction/retention.

Employee Monitoring

Ethical Issues: Potential for unfair discipline, privacy violation, distrust, stress, and anxiety.

"Brown Eyes, Blue Eyes" Experiment

Demonstrates: The impact of social conditioning on prejudice.

Non-Employee Workers

Examples: Contractors and volunteers are not considered employees.

Procedural vs. Distributive Justice

Justice Focus: Procedural justice focuses on the fairness of the process, while distributive justice focuses on the fairness of the outcome.

Airbnb's Impact

Ethical Issue: Potential to decrease availability of housing and increase competition in the housing market.

Gig Economy

Characteristic: Temporary work arrangements.

Human Rights Impact Assessments

Purpose: Assessing potential human rights risks and impacts.

Multinational Corporations (MNCs) and Globalization

Race to the Bottom: Competition among countries for foreign investment by lowering labor and environmental standards.

Migrant Worker Vulnerabilities

Challenge: Inability to work or social distance during the COVID-19 lockdowns.

Airbnb Benefits

Positive Impact: Providing home-like accommodation.

Corporate Responsibility to Migrant Workers

Key Responsibility: Upholding human rights standards.

Greenwashing

Definition: Misleading consumers about actual environmental impact of products.

Tide Pod Case

Ethical Concern: Product safety.

Microcredit Programs

Goal: Providing financial services to low-income individuals.

Inclusive Marketing

Ethical Issue: Representing all demographics.

Marketing Pricing Issues

Ethical Issue: Price fixing.

Targeting Vulnerable Consumers

Ethical Problems: Discrimination, excessive pricing, deceptive pricing, and exclusion.

Marketing Communications Issues

Problems: Deception, misleading claims, and intrusiveness.

Contemporary Consumerism

Moral Complications: Creation of artificial wants, perpetuation of dissatisfaction, and reinforcement of stereotypes.

Circular Economy and Supply Chains

Definition: Circular economy reduces waste by reusing and recycling materials, fundamentally changing the way we think about supply chains.

Fair Trade Movement

Goal: Protecting the rights of workers in developing countries.

Triple Bottom Line

Concept: Balancing economic, social, and environmental factors in sustainable supply chains.

Global Production Network (GPN)

Definition: Network of firms, suppliers, and other interconnected global businesses through distribution.

"Race to the Bottom" Phenomenon

Description: Competition among countries to attract foreign investment by lowering environmental and labor standards.

Choice Editing

Potential Drawbacks: Considered manipulative and paternalistic, limiting consumer choice and freedom.

Consumer Role in Supply Chains

Active Role: Consumers can choose ethical products, support organizations promoting ethical practices, and boycott unethical companies.

Supply Chain Stakeholders

Parties Involved: Includes competitors, consumers, government agencies, and suppliers along the supply chain.

CSO Stakeholder Representation

Role: CSOs advocate for individual and non-human stakeholders.

Rise: Due to failure of traditional markets and governments to address social issues.

CSO-Business Involvement

Collaborative Approach: CSOs can collaborate with businesses as one of the ways for them to be involved.

Brent Spar Case

Outcome: Raised awareness about waste regulations.

Radical CSO Tactics

Non-collaborative Tactics: Boycotts, public awareness campaigns, and (sometimes) violent direct action are all tactics CSOs employ.

Buycotts

Purpose: To encourage consumers to support better products.

CSO Primary Role

Advocacy: Promoting specific interests, causes, or goals.

Community Acceptance: Community acceptance of a company's activity.

CSO Risks in Business Collaborations

Compromised Independence: Possible compromises in maintaining independence when working with businesses.

Government and Business

Stakeholder Role: Government acts as a stakeholder representing its own interests alongside businesses and the public.

Regulation Function

Influence: Controlling and influencing business behavior.

Corruption and Business-Government Interactions

Issue: Businesses influencing government policies through payments or other forms of private gain.

Market Failures and Government Intervention

Addressing Market Failures: Government intervention through policies addresses market failures that prevent efficient allocation of goods and services.

Juan and Santiago Case

Ethical Dilemma: Juan's decision to build Santiago's pool even though it is unethical.

Utilitarian Perspective (Juan and Santiago)

Arguments For and Against: For - improved community; Against - harm to the taxpayer

Kantian Perspective (Juan and Santiago)

Moral Principles: Juan should act according to universal moral principles.

B2B vs. B2G Relationships

Influence: B2G relationships are more influenced by political factors than B2B counterparts.

Ethics and Legality

Relationship: Ethical behavior is not always legally mandated.

Human Rights Impact Assessment

Purpose of Assessment: Identifying potential human rights risks and impacts.

Shareholder Value Maximization

Prominent Advocate: Milton Friedman championed prioritizing shareholder value.

Categorical Imperative

Ethical Philosopher: Immanuel Kant associated with the categorical imperative.

Moral Imagination

Application: Developing innovative solutions to complex ethical dilemmas.

Ageism

Description: Example of discrimination based on age preferences in hiring.

Race to the Bottom

Globalization Impact: Countries competing for foreign investment by weakening their social and environmental standards due to globalization.

Aspects: Economic, legal, ethical, and philanthropic responsibilities.

Corporate Transparency

Definition: The degree to which corporate decisions, policies, activities, and impacts are visible to stakeholders.

Ethical Absolutism vs. Relativism

Perspectives: Ethical absolutism assumes universally applicable principles, while ethical relativism considers morality context-dependent and subjective.

Milgram Studies

Outcome: Provided insights into authority and human obedience.

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Description

This quiz explores the fundamental concepts of business ethics and Corporate Social Responsibility (CSR), including Carroll's CSR Pyramid, the ESG framework, and stakeholder theory. Dive into the critical components that influence a company's ethical responsibilities and its social welfare contributions.