Shared Flashcard Set

Details

BA385
Midterm
114
Business
10/28/2010

Additional Business Flashcards

 


 

Cards

Term
Society
Definition
broad group of people and other organizations, interest groups, a community, a nation
Term
Business
Definition
collection of private commercially oriented organizations
Term
Macroenvironment
Definition
the total environment outside the firm
Term
4 areas of Macroenvironment
(PETS)
Definition
Political: focus on the process by which laws get passed and officials get elected and all others aspects of the interaction between the firm, political process, and government.

Economic: focuses on the nature and direction of the economy in which business operates.

Social: focuses on demographics, lifestyle, and social values of society. e.g., diverse population

Technological: represents the total set of technology-based advancements taking place in society.
Term
Pluralism
Definition
diffusion of power amongst society’s many groups and organizations
Term
Strengths of Pluralism
Definition
1. Prevents concentrations of power
2. Maximizes freedom of expression and action
3. Disperses individual allegiances
4. Created diversified set of loyalties
5. Provides checks and balances
Term
Weaknesses of Pluralism
Definition
1. Pursuit of self-interest
2. Proliferates organizations and groups with overlapping goals
3.Forces conflicts to center stage
4. Promotes inefficiency
Term
What does it mean to business to operate within a special interest society?
Definition
Catering to different special interest groups in society.
Term
What are the factors that lead to business criticism?
(AAEERRV)
Definition
1. Affluence
2. Awareness
3. Education
4. Entitlement Mentality
5. Rights Movement
6. Rising Expectations
7. Victimization Philosophy
Term
Draw the graph that demonstrates society´s expectations of business will always outpace business´s actual social performance.

Describe this graph.
Definition
The graph shows the expected social performance and the actual social performance. In between lays the social problem which describes society’s expectations of social conditions and the current social realities or society’s expectations of a firm’s social performance and its actual social performance.
Term
Business Power
Definition
The ability or capacity to produce an effect or to bring influence.
Term
Iron Law of Responsibility
Definition
In the long run, those who do not use power in a manner society considers responsible will tend to lose it.
Term
Iron Law of Responsibility Example
Definition
Tobacco Companies
Term
What is meant by the social contract between business and society?
Definition
A shared understanding that reflects mutual expectations regarding each other’s roles, responsibilities and ethics.
Term
What happened in the Pullman village?
Definition
George Pullman created his own town in which his employees lived.
Term
Corporate Social Responsibility
Definition
Seriously considering the company’s actions on society.
Term
Corporate Social Responsibility (Archie Carroll)
Definition
The economic, legal, ethical and discretionary expectations that society has of organizations at a given point in time.
Term
What are the 4 parts of Archie Carroll CSR
Definition
1. Econmic (required) – Be profitable, maximize sales, minimize cost.
2. Legal (required) – Obey laws, adhere to regulations.
3. Ethical (expected) – Avoid questionable practices. Do what is right, fair and just.
4. Philanthropic (desired/expected) – Be a good corporate citizen. Give back.
Term
Define the three corporate citizenship concepts (CSR, CSR and CSP)?
Definition
1. Corporate Social Responsibility: obligation, accountability
2. Corporate Social Responsiveness: action, activity
3. Corporate Social Performance: outcomes, results
Term
What led to the modification of the Economic Model?
Definition
The modification of the economic model began with the emergence of large corporations in the late 1800’s. As power began to concentrate on these large corporations, questions of the responsibility of business to society surfaced. In the 1920’s business leaders became involved with other nongovernmental groups for a common, nonbusiness purpose that necessitated their contribution of time and money to community welfare projects. By 1950 CSR grew to include employee welfare, medical care, safety, retirement and so on. According to Neil J. Mitchell, as business leaders began to recognize that the government had the power to intervene in the economy, they attempted to persuade those affected by business power that such power was being used appropriately and by doing so try to keep the government at arm’s length.
Term
When it comes to legal responsibilities of business, why isn´t that enough to protect society?
Definition
It does not embrace the full range of behaviors expected of business by society. First, law cannot possibly address all topics or issues that businesses may face. Second, law often lags behind more recent concepts of what is considered appropriate behavior. Third, laws are made by lawmakers and may reflect the personal interest or political motivation of legislators rather than appropriate ethical justifications.
Term
List and describe four arguments against CSR according to text and lecture.
(DBTCG)
Definition
1. Dilutes Business Purpose: dilutes the primary purpose of business

2. Business Not Equipped: managers don’t have the necessary expertise to make social decisions

3. Too Much Power: Increases the power of business by adding social power to their list of economic, technological and environmental powers.

4. Classical Economics: restricts the goal of profit maximization

5. Global Competitiveness - Limits the ability to compete in a global market because of higher cost
Term
List and describe four arguments for CSR.
(PPEWRR)
Definition
1. Proactive: addresses issue by anticipating and initiating

2. Public Support: public strongly supports it

3. Enlightened Self-Interest: protect self-interest and long-term viability

4. Warding Off Government: wards off future government intervention and regulation

5. Reacting: Address social issues brought on by business, and allows business to be part of the solution

6. Resources Available: addresses issues by using business resources and expertise
Term
List and describe two internal drivers of corporate citizenship.
Definition
1. Traditions and Image: positive company image

2. Recruiting/Retaining Employees: improved retention, recruiting, loyalty and productivity
Term
List and describe two external drivers of corporate citizenship.
Definition
1. Consumers and Customers: customer loyalty

2. Expectations in the Community: what the community expects
Term
What is meant by the “triple bottom line”?
Definition
Encapsulate 3 key spheres of sustainability.

Economic: the firm’s creation of material wealth
Social: the quality of people’s lives and the equity between people, communities and nations
Environmental: protection and conservation of the natural environment
Term
What is meant by the “multiple bottom line”?
Definition
To truly operate with a stakeholder prospective.

Owner “bottom line”
Consumer “bottom line”
Employee “bottom line”
Community “bottom line”
Other stakeholders “bottom line”
Term
List the three Social and Financial Performance prospectives and explain why “perspective 3” is probably the closest to reality.
Definition
Draw the figure on page 70 and describe it.

Perspective 1: CSP Drives the Relationship

Perspective 2: CFP Drives the Relationship

erspective 3: Interactive Relationships Among CSP, CFP, and CR
Term
Social Screening
Definition
Social screening is the backbone of the socially conscious investment movement. Investors screen in/out companies that they consider socially irresponsible or socially responsible.
Term
List two reasons for the upsurge in social responsible investing.
Definition
1. There is more reliable and sophisticated research on CSP than in the past.

2. Investment firms using social criteria have established a solid track record and investors don’t have to sacrifice gains for principle.

3. The socially conscious 1960’s generation is now making investment decisions.
Term
Stakeholder
Definition
Individual or group that has one or more of the various kinds of stakes in the organization.
Term
Stake
Definition
Interest in or a share in an undertaking.
Term
Give ten examples of different stakeholders in typical business.
Definition
Employees
Customers
Consumers
Competitors
The Community in which the organization operates.
Stockholders
Owners
Global Community
Suppliers
Special-interest groups
Society
Government
Term
Describe how views of business evolved from a “production view” to a “stakeholder view”.
Definition
Draw and explain the figure on page 3 slides.
In the traditional productions view of the firm, owners thought of stakeholders as only those individuals or groups who supplies resources or bought products or services. As corporations grew the separation of ownership and control developed into the managerial view of the firm. Finally as major internal and external changes occurred in business and its environment, management have to take a different prospective on they viewed their relationship with stakeholder groups. The result was stakeholder view.
Term
Core Stakeholders
Definition
Essential for the survival of the organization.
Term
Strategic Stakeholders
Definition
Vital to the organizations success.
Term
Environmental Stakeholders
Definition
All other stakeholders who are not core or strategic.
Term
Stakeholder Legitimacy
Definition
Perceived validity of a stakeholder’s claim to a stake.
Term
Stakeholder Power
Definition
The ability to produce an effect – to get something done that otherwise may not be done.
Term
Stakeholder Urgency
Definition
The degree to which the stakeholder claim on the business calls for the business’s immediate attention or response.
Term
What are the five questions of stakeholder management?
Definition
1. Who are our stakeholders?

2. What are our stakeholders’ stakes?

3. What opportunities and challenges do our stakeholders present to the firm?

4. What responsibilities (economic, legal, ethical and philanthropic) does the firm have to its stakeholders?

5. What strategies or actions should the firm take to best address stakeholders’ challenges and opportunities?
Term
Define two of the three levels of stakeholder management capability.
Definition
Level 1 – The Relational Level: entails the company identifying who their stakeholders are and what their stakes happen to be.

Level 2 – The Process Level: organizations develop and implement approaches, procedures, policies and practices by which the firm may scan the environment and receive relevant information about stakeholders, which is then used for decision-making purposes.
Term
How does a firm develop a stakeholder culture (from agency to altruism)?
Definition
First is the agency culture which basically is not concerned with others. Next are both corporate egoist and instrumentalist who focus on the firm’s stockholders and important stakeholders. They focus on the short-term profit maximization. The last two cultures are broadly moral – moralist and altruism. These cultures are morally based and provide the broadest concern for stakeholders.
Term
Stakeholder Engagement
Definition
An approach by which companies implement a transactional level of strategic management capability.
Term
Give a Stakeholder Engagement example.
Definition
When McDonald’s entered into an allegiance with the Environmental Defense Fund to eliminate polystyrene packaging that was not biodegradable.
Term
Stakeholder Inclusiveness
Definition
In the future, development of loyal relationships with customers, employees, shareholders, and other stakeholders will become one of the most important determinants of commercial viability and business success. Increasing shareholder value will be best served if your company cultivates the support for all who may influence its importance.
Term
Stakeholder Symbolism
Definition
An idea that recognizes that all stakeholders depend on each other for their success and financial well-being.
Term
List and briefly describe five of Clarkson`s Principles of Stakeholder Management.
(LAAAAWR)
Definition
P1: Managers should ACKNOWLEDGE and MONITOR the concerns of legitimate stakeholders and should take their interests appropriately into account.

P2: Managers should LISTEN and COMMUNICATE with stakeholders about their concerns and risks they assume by their involvement with the firm.

P3: Managers should ADOPT processes and behaviors that are sensitive to the concerns and capabilities of each stakeholder constituency.

P4: Managers should RECOGNIZE THE INTERDEPENDENCE of efforts and rewards among stakeholders and should attempt to achieve a fair distribution of the benefits and burdens of corporate activity accounting for risks and vulnerabilities.

P5: Managers should WORK COOPERATIVELY with public and private entities, to ensure that risks minimized and, where avoidable, appropriately compensated.

P6: Managers should AVOID ALTOGETHER activities that jeopardize inalienable human rights such as the right to life.
Term
Create the Diagnostic Typology of
Organiza9onal Stakeholders
Definition
Page 6 of slides
Term
Describe ethical issue in the relationship: Employee – Employer
Definition
Cheating on expense accounts.
Term
Describe ethical issue in the relationship: Employer – Employee
Definition
Sexual harassment.
Term
Describe ethical issue in the relationship: Company – Customer
Definition
Deceptive advertising.
Term
Describe ethical issue in the relationship: Company – Shareholder
Definition
Excessive compensation for top management.
Term
Describe ethical issue in the relationship: Company – Community
Definition
Injury to the environment.
Term
Ethics
Definition
The discipline that examines good or bad practices within the context of moral duty and obligation.
Term
Morality
Definition
Principles of right and wrong in behavior.
Term
Business Ethics
Definition
Concerned with good and bad or right and wrong behavior and practices that take place in business.
Term
Explain the difference between Descriptive and Normative ethics.
Definition
Descriptive Ethics involves describing, characterizing and studying morality and focuses on the “what is” and Normative Ethics Concerned with supplying and justifying moral systems and focuses on “what ought or ought not to be”.
Term
List and briefly describe four potential sources of ethical norms.
Definition
1. Faith/Religious Beliefs
2. Family
3. Region of Country
4. Employer
Term
Why is it interesting to consider a person’s favorite saying and who taught them this saying?
Definition
e. “A penny saved is a penny earned”; speaks to the thrift nature of their family and culture. “A bird in the hand is better than two in the bush”; indicates risk avoidance by valuing what you have rather than risking it with the hope to receive more. Often these are learned from family, teachers and friends and they tell a lot about what is valued most and considered ethical by the person and the culture they grew up in.
Term
Immoral Management
Definition
A positive and active opposition to what is moral (ethical).
Term
Amoral Management
Definition
Neither moral nor immoral, these are decisions outside the sphere of business decisions.
Term
Moral Management
Definition
Actively conform to a standard of ethical, or right, behavior.
Term
Example of Immoral Management
Definition
Enron in which executives were getting rich while employees were losing their pension and jobs as the organization plummeted to nothing. I think this is a good example of immoral management because the documentary depicted executives and their opposition to what is ethical.
Term
Example of Moral Management
Definition
Merck & Co who produced a drug for treating “river blindness” and pledge to supply the drug for free forever when no government or aid organization agreed to buy the drug. This is a great example of moral management because they went far beyond industry standards.
Term
Example of Amoral Management
Definition
Videogame Industry and how they lack moral awareness on how developed games with extreme violence, sexism and aggression impact people who become addicted to them.
Term
How can senior management make moral management actionable?
Definition
Sshowing the way to an ethical organizational climate by leading the transition from amoral to moral management, either by business ethics training and workshops, code of conduct, mission/vision statements, officers, tighter financial controls, more ethically responsible decision-making or leadership by example.
Term
Describe two internal sources of a manager’s values.
Definition
1. Respect for the authority structure.
2. Performance counts above all else.
Term
Describe two external sources of a manager’s values.
Definition
2. Legal Values – The legal system continues to be the most powerful force defining what is ethical and what is not for managers and employees. Law represents the minimum ethic of behavior and it is among the most influential drivers of business ethics.
Term
Moral Imagination
Definition
Ability to perceive web of competing economic, moral and ethical relationships.
Term
Moral Identification
Definition
Ability to discern the relevance or nonrelevance of moral factors that are introduced into a decision-making situations.
Term
Sense of Moral Obligation
Definition
“Get it”, that is, have a sense of integrity that oversees decision-making processes and understands what is at stake for all.
Term
Moral Evaluation
Definition
is the practical, decision phase of moral judgment and entails essential skills, such as coherence and consistency, that have proved to be effective principles in other contexts.
Term
Moral Evaluation
Definition
Have clear principles, develop processes for weighing ethical factors, develop way to identify ethical and economic outcomes.
Term
Tolerance of Moral Disagreement and Ambiguity
Definition
Ability to deal in “gray” areas and operate within disagreement.
Term
Integration of Managerial and Moral Competence
Definition
See each decision within a moral perspective that is integrated with a management perspective.
Term
List and briefly describe two of the four levels at which business ethics might be addressed. Give example.
Definition
Personal Level: getting free cable and not telling the cable company.

Organizational Level: overestimating time worked on a project to get paid for overtime.
Term
List and describe three principles of ethics that can help a person resolve and ethical problem.
Definition
1. The Professional Ethic: You should do only that which can be explained before a committee of your peers.

2. The Golden Rule: Do unto others as you would have them do unto you.

3. The Utilitarian Ethic: The greatest good for the greatest number.
Term
List and describe five of the seven ethical tests.
Definition
1. Test of Common Sense: To ask oneself “Is this action I am getting ready to take really make sense?”

2. Test of One’s Best Self: To ask oneself “Is this action I am getting ready to take compatible with my concept of myself at my best?”

3. Test of Making Something Public: To ask oneself “How would I feel if others knew I was doing this?”

4. Test of Ventilation: Seek others opinion on what you are about to do.

5. Gag Test: If you “Gag” at the idea of carrying out an action, then don’t do it.
Term
4. When managers were asked to rank the factors they thought influence or contributed to unethical behavior, what did they list (list and describe four factors)?
Definition
1. Behavior of superiors
2. Ethical practices of one’s industry or profession
3. Behavior of one’s peers in the organization
4. Personal financial need
Term
List and describe five questionable behaviors and practices of superiors or peers that make a workplace ethically challenging.
Definition
1. Acceptance of legality as a standard of behavior – if they are abiding the law, they are doing the most they ought to do.

2. “Bottom-line” mentality and expectations of loyalty and conformity – little value of doing what is right and on being sensitive to other stakeholders.

3. Absence of Ethical Leadership – The absence of moral management.

4. Inadequate formal ethics policies – the absence of a clear code of conduct.

5. Amoral decision making – failure to factor ethical consideration in actions, decisions and behavior.
Term
6. List and describe five ways to improve an organization’s ethical climate or culture.
Definition
1. Ethics Programs and Officers: Ethical programs within an organization that embrace both compliance and ethics. These programs include features like written standards of conduct, ethics training, mechanisms to seek ethics advice or information, methods of reporting misconduct anonymously, discipline of violators, and inclusion of ethics in the evaluation of employees.

2. Ethics Audits and Risk Assessments: it includes assessing an organization’s current ethics program and climate. Ethics audits are intended to carefully review such ethics initiatives as ethics programs, code of conduct, hotlines and ethics training programs. Risk assessment is intended to detect compliance and ethics threats and allow companies to correct them before they occur or get worse.

3. Ethics Training: Organizations educate their employees on the company’s standards and policies through publications and training as well as web-based applications.

4. Code of Conduct: Standards of behavior or code of ethics that should be followed by members of the organization. Most large organizations have a code of conduct.

5. Discipline of Violators: Organizations must discipline violators in order for members of the organization to believe in it ethics climate.
Term
Please re-create the figure on page 328 and apply it to the following ethical question: Should a pharmaceutical company give expired drugs to impoverished nations for distribution to those in need of such drugs who could otherwise not afford them?
Definition
Page 328
Term
Ethics Code of Conduct
Definition
Standards of behavior established by top management in the organization. They serve to raise the level of ethical behavior in the organization by clarifying what is meant by ethical conduct and encouraging moral behavior.
Term
List two things important to know about ethics code of conduct. Give an example.
Definition
1. Ethics codes vary considerably from company to company.

2. Ethics codes vary in their focus.

Example: To instill trust and honesty throughout the organization.
Term
Describe the evolution from moral decision to moral organizations.
Definition
A moral decision is made by a manager, then a manager adopts the characteristics of moral management and finally the organization is dominated by the presence of moral managers making moral decisions and creating a moral climate in the organization.
Term
Technology
Definition
“totality of the means employed to provide objects necessary for human sustenance and comforts”. A scientific method used in achieving a practical purpose.
Term
Technological Determinism
Definition
The imperative that what can be developed will be developed or scientist and those who work with technologies are driven to push back the frontiers of technological development without consideration of ethical issues or side effects.
Term
Ethical Lag
Definition
When the speed of technological change
outpaces that of ethical development.
Term
List and describe three benefits of technology.
Definition
1. Increased Production of Goods and Services: machines do most of the works in many industries, including farming, manufacturing, mining and others.

2. Increased Productivity: technology has reduced the amount of labor needed to produce goods and services increasing production and productivity.

3. Increased Standard of Living: technology has made labor easier and safer and economies that have been able to take advantage of technology live fuller healthier lives.
Term
List and describe three side-effects of technology.
Definition
1. Environmental Pollution: Due to technology most industrial nations face significant air, water, soil, solid waste and noise pollution.

2. Depletion of Natural Resources: Technology continually threatens the supply of natural resources. Fuel shortage and power shortage.

3. Technological Unemployment: happens when machines take the place of humans.
Term
List and describe four key issues in the ethics of e-Commerce.
Definition
1. Access: difference in computer access between the rich and poor

2. Intellectual Property: file sharing

3. Privacy and Informed Consent: cookies to collect consumer behavior and store it on our computers.

4. Protection of children: Free to access all content on the web
Term
4. Briefly describe two aspects of the Financial Services Modernization Act of 1999.
Definition
1. Allowed financial companies to combine forces and allow consumers multiple services such as mortgage, credit cards, etc.

2. Gave companies more power and access to a customer’s entire financial profile.
Term
Briefly describe two aspects of the Gramm-Leach-Bliley Act.
Definition
1. Requires financial institutions to provide privacy notices to consumers

2. Gave customers, to some extent, to choose if their information is share with third parties.
Term
What has the Federal Trade Commission done to protect consumer’s privacy (list two things)?
Definition
1. Creating a National Do-Not-call List

2. Helping Victims of Identity Theft
Term
What has business done to protect consumer’s privacy (list two things)?
Definition
1. Privacy policies design to protect consumers

2. Data security so customer information is not stolen
Term
List and briefly describe four of the ten commandments of computer ethics.
Definition
1. Thou shall not use a computer to harm other people.

2. Thou shall not snoop around in other people’s computer files.

3. Thou shall not use a computer to steal.

4. Thou shall not interfere with other people’s computer work.
Term
Bioethics
Definition
A field that has emerged to deal with ethical issues embedded in the use of biotechnology.
Term
Proceduralism
Definition
The use of elaborate protocols to ensure that classical safeguards, such as informed consent, are not violated.
Term
List and describe two issues with genetically modified foods.
Definition
1. Safety issues: Scant information is available to the public as to the actual safety or lack of safety of these products, because field-testing is continue – dangerous to human health.

2. Labeling issues: many consumer activists think that, at a minimum, foods that contain genetically engineered contents ought to be labeled as such.
Term
Internationalization
Definition
A process by which firms increase
their awareness of the influence of
international activities on their future
and conduct transactions with firms
from other countries.
Term
Globalization
Definition
The global economic integration of many
formerly national economies into one
global economy.
Term
NAFTA
Definition
1994 trade agreement that integrated the US, Canadian and Mexican economies.
Term
Contrast the views of globalists and anti-globalists along three dimensions.
Definition
Dimension:
- Globalists
- Anti Globalists

Consumers:
- promotes lower costs
- penefits the wealthy at the expense of the poor

Employees:
- higher wages, improved working conditions, faster economic growth
- places profit avobe people

Environment:
- creates resources needed to address environmental issues
- exploits and destroys ecosystems, more pollution
Term
Describe the dilemma of the multinational corporation.
Definition
They must deal with stakeholder pressures from their home country as well as the host countries in which they operate. Pressures include standards, practices, ethics, laws, culture, customs, system of government, and socioeconomic system.
Term
List and describe two ethical issues in the global environment and give an example for each.
Definition
Questionable Marketing: The Infant Formula Controversy (Nestle)

Plant Safety: The Bhopal Tragedy - Killed 2k poeple and injured 200k. Met standard based on the host country but not US standards.
Term
Describe Social Accountability 8000 (SA8000).
Definition
Launched in 1997.

1. Child Labor: No workers under the age of 14.

2. Forced Labor: No forced labor, including prison or debt bondage labor.

3. Health and Safety: Provide a safe and healthy work environment, prevent injury, health/safety training, access to bathrooms and potable water.

4. Freedom of Association and Right to Collective Bargaining: Right to form and join a trade union and bargain collectively.

5. Discrimination: No discrimination based on race, origin, religion, disability, gender, sexual orientation, union of political affiliation or age.

6. Discipline: No corporal punishment, mental or physical coercion, or verbal abuse.

7. Working Hours: No more than 48 hours per week. Day off in 7 day period, overtime max 12 hours.

8. Compensation: Wages must meet legal and industry standard and sufficient to meet basic need of workers and their families.

9. Management Systems: Certification to integrate the standard into their management system and practices. Certification to SA800 requires semi-annual reviews and visits.
Term
Give two arguments for bribery.
Definition
1. Common practice.
2. Accepted practice.
Term
Give two arguments against bribery.
Definition
1. Wrong and illegal in most developed nations
2. Compromise personal beliefs
Term
What does the Foreign Corrupt Practices Act mean for an agent of an American corporation?
Definition
Passed in 1977 makes it a criminal offense for a representative of an American corporation to offer or give payments to the officials of other governments for the purpose of getting or maintaining business. Includes a series of fines and prison terms that can result if a company or management is found guilty.
Term
Draw the model that shows the pressures under which multinational corporations must operate.
Definition
Figure 10-5 p.430
Term
Ethical Imperialism
Definition
MNCs follow it’s home country’s ethical standards while operating in another country.
Term
Cultural Relativism
Definition
MNCs follow the host country’s ethical standards.
Term
UN Global Compact
Definition
Operation headquarters launched in July of 2000 and reside in New York. Today thousands of companies from all over the world, international labor, and civil society organizations are engaged in the Global Compact, working to advance 10 universal principals in the areas of human rights, labor, the environment and anticorruption.