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Chapter 5 Social Responsibility and Managerial EthicsTrue/False Questions5.The classical view of organizational social responsibility is that managements only social responsibility is to maximize profits.True (moderate)7.In the socioeconomic view of organizational social responsibility, maximizing profits is a companys second priority.True (moderate)9.Socially responsible businesses tend to have less secure long-run profits.False (difficult)12.The difference between an organizations social obligation and social responsiveness is the legal aspect.False (moderate)14.Values-based management is an approach to managing in which managers establish, promote, and practice an organizations shared values.True (easy)15.Though the outcomes are not perfectly measured, the majority of research studies show a positive relationship between corporate social involvement and economic performance.True (easy)20.The market approach to going green is when organizations respond to multiple demands of stakeholders.False (moderate)21.The activist approach to going green is when an organization looks for ways to respect and preserve the earth and its natural resources.True (moderate)25.Ethics refers to the rules and principles that define right and wrong conduct.True (moderate)26.In the rights view of ethics, decision-makers seek to impose and enforce rules fairly and impartially.False (moderate)27.The integrative social contracts theory proposes that decisions should be made on the basis of empirical and normative factors.True (difficult)28.Studies have shown that most business people continue to hold utilitarian attitudes toward ethical behavior.True (moderate)29.In the preconventional stage of moral development, individuals make a clear effort to define moral principles apart from the authority of the groups to which they belong or society in general.False (moderate)Multiple Choice35.Which of the following is associated with the classical view of social responsibility?a.economist Robert Reichb.concern for social welfarec.stockholder financial return (moderate)d.voluntary activitiese.ethical behaviors37.The socioeconomic view of corporate responsibility suggests that _.a.stockholders are the only responsibility.b.corporations are independent entities.c.maximizing profits is the first priority while social responsibility is the second priority.d.corporations are responsible to the state and its citizens. (moderate)anizations have an ethical but no legal responsibility to anyone except stockholders.39._ is defined as a business firms obligation, beyond that required by law and economics, to pursue long-term goals that are good for society.a. Social obligationb. Social responsibility (moderate)c. Social screeningd. Value-based managemente. Social autonomy54.Which of the following terms refers to when a firm meets its economic and legal responsibilities?a.social responsibilityb.social obligation (moderate)c.social responsivenessd.social dutye.social standard57.When a firm advertises that it only uses recycled paper products, it is _.a.meeting its social obligation.b.meeting social responsibilities.c.being socially responsive. (difficult)d.paying attention to the bottom line.e.attempting to defraud consumers.59.One should be cautious in the interpretation, but a summary of more than a dozen studies analyzing the relationship between organizational social responsibility and economic performance provides what conclusion?a. Being socially responsible causes good economic performance.b. Good economic performance allows firms to be socially responsible.c. There is a positive relationship between corporate social involvement and economic performance. (difficult)d. Corporate social involvement tends to devalue stock price in the long run.e. Corporate social involvement tends to result in increased net income but lower stock prices.a. Social autonomy65.Which of the following is true regarding shared corporate values?a. Individuals adapt easily to shared corporate values.b. Top management dictates shared corporate values.c. It is not easy to establish shared corporate values. (moderate)d. Most corporations will be unable to successfully establish shared corporate values.e. Shared corporate values negatively impact team spirit.72.The _ approach to environmental issues is when an organization obeys rules and regulations but exhibits little environmental sensitivity.a.legal (moderate)b.marketc.stakeholderd.responsibilitye.activist74.The _ approach to environmental issues is when organizations respond to environmental preferences of their customers.a.legalb.market (moderate)c.stakeholderd.responsibilitye.activist75.Which of the following approaches toward environmental issues exhibits the highest degree of environmental sensitivity and is a good illustration of social responsibility?a. legal approachb. market approachc. stakeholder approachd. activist approach (moderate)81.Which of the following is a basic definition of ethics?a.moral guidelines for behaviorb.rules for acknowledging the spirit of the lawc.rules or principles that define right and wrong conduct (moderate)d.principles for legal and moral developmente.There is no way to define ethics.84.Which of the following encourages efficiency and productivity and is consistent with the goal of profit maximization?a. utilitarian view (moderate)b. principled viewc. rights viewd. theory of justice viewe. integrative social contracts theory85.The rights view of ethics is based on which of the following?a.decisions based on their outcomes or consequencesb.the imposition and enforcement of fair and impartial rulesc.respect and protection of individual liberties and freedoms (moderate)d.the process used to determine the distribution of resourcese.the existing ethical norms in industries and corporations86.The theory of justice view of ethics is based on which of the following?a.the process used to determine the distribution of resourcesb.the existing ethical norms in industries and corporationsc.decisions based on their outcomes or consequencesd.the imposition and enforcement of fair and impartial rules (difficult)e.respect and protection of individual liberties and freedoms87.The integrative social contracts theory of ethics is based on which of the following?a.the process used to determine the distribution of resourcesb.decisions based on their outcomes or consequencesc.the imposition and enforcement of fair and impartial rulesd.the existing ethical norms in industries and corporations (difficult)e.respect and protection of individual liberties and freedoms92.A personality measure of a persons convictions is _.a. moral development.b. ego strength. (moderate)c. locus of control.d. social desirability.e. self-image.93._ is a personality attribute that measures the degree to which people believe they control their own fate.a. Ego strengthb. Locus of control (easy)c. Social responsibilityd. Social obligatione. Social autonomy97.Which of the following is true concerning the impact of organizational culture on ethical behavior?a. Low conflict tolerance leads to ethical behavior.b. A strong culture will support high ethical standards. (moderate)c. Conflict tolerance is related to unethical behavior.d. A culture that is high in control tends to encourage unethical behavior.e. None of the above is true.104.A survey of various codes of ethics found that their content tended to fall into all of the following categories EXCEPT:a. be a dependable and organizational citizen.b. do not do anything unlawful or improper that will harm the organization.c. consider profit maximization to be the primary focus of the company. (moderate)d. be good to customers.Essay QuestionsWHAT IS SOCIAL RESPONSIBILITY?122.In short essay, discuss social responsibility and compare and contrast social obligation and social responsiveness.Answera. Social responsibility adds an ethical imperative to do those things that make society better and not to do those that could make it worse. A social responsible organization goes beyond what it must do by law or chooses to do only because it makes economic sense to do what it can to help improve society because thats the right, or ethical, thing to do. Social responsibility requires business to determine what is right or wrong and to make ethical decisions and engage in ethical business activities. A social responsible organization does what is right because it feels it has a responsibility to act that way. b. Social obligation is the obligation of a business to meet its economic and legal responsibilities. The organization does the minimum required by law. Following an approach of social obligation, a firm pursues social goals only to the extent that they contribute to its economic goals. This approach is based on the classical view of social responsibility; that is, the business feels its only social duty is to its stockholders. In contrast to social obligation, however, both social responsibility and social responsiveness go beyond merely meeting basic economic and legal standards. c. Social responsiveness refers to the capacity of a firm to adapt to changing societal conditions. The idea of social responsiveness stresses that managers make practical decisions about the societal actions in which they engage. A socially responsive organization acts the way it does because of its desire to satisfy some popular social need. Social responsiveness is guided by social norms. The value of social norms is that they can provide managers with a meaningful guide for decision making.(moderate)125.In a short essay, explain the four approaches that organizations can take with respect to environmental issues.AnswerThe first approach simply is doing what is required legally: the legal approach. Under this approach, organizations exhibit little environmental sensitivity. They obey laws, rules, and regulations willingly and without legal challenge, and they may even try to use the law to their own advantage, but thats the extent of their being green. This approach is a good illustration of social obligation: These organizations simply are following their legal obligations of pollution prevention and environmental protection. As an organization becomes more aware of and sensitive to environmental issues, it may adopt the market approach. In this approach, organizations respond to the environmental preferences of their customers. Whatever customers demand in terms of environmentally friendly products will be what the organization provides. Under the next approach, the stakeholder approach, the organization chooses to respond to multiple demands made by stakeholders. Under the stakeholder approach, the green organization will work to meet the environmental demands of groups such as employees, suppliers, or the community. Both the market approach and the stakeholder approach are good illustrations of social responsiveness. Finally, if an organization pursues an activist approach, it looks for ways to respect and preserve the earth and its natural resources. The activist approach exhibits the highest degree of environmental sensitivity and is a good illustration of social responsibility.(moderate)126.In a short essay, describe the four-stage model of an organizations expanding social responsibility.AnswerA Stage 1 manager will promote stockholders interests by seeking to minimize costs and maximize profits. Although all laws and regulations will be followed, Stage managers do not feel obligated to satisfy other societal needs. This is consistent with Friedmans classical view of social responsibility. At Stage 2, managers will accept their responsibility to employees and focus on human resource concerns. Because theyll want to recruit, keep, and motivate good employees, Stage 2 managers will improve working conditions, expand employee rights, increase job security, and the like. At Stage 3, managers expand their responsibilities to other stakeholders in the specific environmentthat is, customers and suppliers. Social responsibility goals of Stage 3 managers include fair prices, high-quality products and services, safe products, good supplier relations, and similar actions. Their philosophy is that they can meet their responsibilities to stockholders only by meeting the needs of their other constituents. Finally, Stage 4 characterizes the extreme socioeconomic definition of social responsibility. At this stage, managers feel a responsibility to society as a whole. Their business is seen as a public entity, and they feel a responsibility for advancing the public good. The acceptance of such responsibility means that managers actively promote social justice, preserve the environment, and support social and cultural activities. They take these stances even if such actions negatively affect profits. (moderate)127.In a short essay, discuss the four views of ethics. Include a discussion of the benefits and drawbacks related to each of the four views.Answera. The utilitarian view of ethics says that ethical decisions are made solely on the basic of their outcomes or consequences. Utilitarian theory uses a quantitative method for making ethical decisions by looking at how to provide the greatest good for the greatest number. Utilitarianism encourages efficiency and productivity and is consistent with the goal of profit maximization. However, it can result in biased allocations of resources, especially when some of those affected by the decision lack representation or a voice in the decision. Utilitarianism can also result in the rights of some stakeholders being ignored. b. The rights view of ethics is concerned with respecting and protecting individual liberties and privileges such as the rights to privacy, freedom of conscience, free speech, life and safety, and due process. This would include, for example, protecting the free speech rights of employees who report legal violations by their employers. The positive side of the rights perspective is that it protects individuals basic rights, but it has a negative side for organizations. It can present obstacles to high productivity a
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