43 Questions
Who are the inside stakeholders of an organization?
Shareholders, managers, and the workforce
What inducements do inside stakeholders typically receive?
Money, power, and organizational status
What is the responsibility of top managers in an organization?
To invest shareholder money in resources to maximize the organization's future output of goods and services
What do shareholders typically receive as their claim on organizational resources?
Prospective money in the form of dividends and increased stock prices
Who are considered the owners of an organization?
Shareholders
What comprises an organization's workforce?
All the nonmanagerial employees
What is the primary contribution of customers to an organization?
Purchasing goods and services
Which stakeholder group wants companies to compete in a fair manner and obey the rules of free competition?
Government
What is the role of trade unions in relation to an organization?
Affecting the productivity and effectiveness of the organization
What is a major problem that an organization has to face in terms of stakeholder approval?
Deciding how to allocate organizational rewards to different stakeholder groups
Who has the ultimate authority over the use of a corporation’s resources?
Shareholders
What is the role of inside directors in a company?
Accessing the most information
What is the system of hierarchical reporting relationships within a large corporation called?
Chain of command
Who is responsible for setting the organization’s goals and designing its structure?
(CEO) The Chief Executive Officer
What can influence organizational effectiveness and decision making in five ways?
Allocating scarce resources among functional areas or business divisions.
What does authority refer to in an organizational context?
The power to hold people accountable for their actions and to influence directly what they do and how they do it.
What is the primary contribution of suppliers to an organization?
Providing reliable raw materials and component parts.
What is the role of corporate-level management in an organization?
Having the ultimate responsibility for setting goals and objectives, allocating organizational resources, and designing the organization’s structure.
Who reports directly to the CEO and shares the principal responsibility for managing the business?
Chief Operating Officer (COO)
What do managers in line roles have direct responsibility for?
Production of goods and services
What is the term used to describe the conduct of corporate managers who act in their own interests rather than in the interests of other stakeholders?
Self-dealing
What is the central issue to overcome the agency problem according to the text?
Aligning interests of principal and agent
What are ethical dilemmas according to the text?
Quandaries where people have to decide between self-interest and helping others
What are moral scruples according to the text?
Thoughts and feelings that tell a person what is right or wrong
What is a moral hazard problem according to the text?
A problem in evaluating agent's performance due to information advantage
What are governance mechanisms according to the text?
Forms of control that align interests of principal and agent
What is stock-based compensation according to the text?
Monetary rewards linked to company's performance.
What is an ethical decision according to the moral rights model?
Decision that maintains and protects fundamental rights and privileges.
What is described by 'self-dealing' according to the text?
Conduct of corporate managers acting in their own interests.
What are ethics according to the text?
Inner-guiding moral principles, values, and beliefs.
What is an agency problem according to agency theory?
Problem in determining managerial accountability due to information disadvantage.
According to the passage, what are the three principal sources of ethical values that influence organizational ethics?
Societal, group or professional, and individual ethics
What is one of the reasons why ethical rules governing action develop?
To control self-interested behavior
What is the 'tragedy of the commons' problem referred to in the passage?
A problem related to self-interested behavior
What is whistle-blowing as mentioned in the text?
When employees inform outside persons or agencies about unethical behavior
Why do ethical laws and rules emerge, according to the passage?
To control self-interested behavior by individuals and organizations
What do professional ethics refer to as mentioned in the passage?
The way a group of people uses to control the performance of tasks
How can an organization encourage employees to act ethically?
By setting incentives for ethical behavior and disincentives for unethical behavior
What is one of the reasons why unethical behavior takes place, according to the passage?
Outside pressure
What does 'whistle-blowing' culture refer to as mentioned in the text?
When employees feel powerless to prevent an organization from committing an unethical act.
What is one of the best ways of understanding the self-interest issue, as mentioned in the text?
'Tragedy of the commons' problem.
What does 'professional ethics' specifically control as per the passage?
Performance of tasks or use of resources.
According to the passage, what are societal ethics codified in?
Legal system, customs and practices, and unwritten norms and values.
Test your knowledge of the impact of CEO's actions and reputation on stakeholders, as well as the role and responsibilities of the Chief Operating Officer (COO) or president in managing the business.
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