TBChap 005

Chapter 05
Ethics, Corporate Social Responsibility, and Sustainability
True / False Questions
1. Ethical strategies are the accepted principles of right or wrong governing the conduct of
businesspeople.
True False
2. What is considered normal business practice in one country may be considered unethical in other
countries.
True False
3. The Sullivan principles mandated that GM could operate in South Africa as long as the company
complied with the apartheid laws.
True False
4. Corporations can contribute to the global tragedy of the commons by not pumping pollutants into the
atmosphere or dumping them in oceans or rivers.
True False
5. International businesses cannot gain economic advantages by making payments to corrupt

government officials.
True False
5-1
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Education.
6. The Foreign Corrupt Practices Act originally allowed "facilitating payments" to secure contracts that
would not otherwise be secured.
True False
7. In a business setting, noblesse oblige is taken to mean benevolent behavior that is the responsibility of
successful enterprises.
True False
8. Social responsibility refers to the idea that businesspeople should favor decisions that have both good
economic and social consequences.
True False
9. The ethical obligations of a multinational corporation toward employment conditions, human rights,
environmental pollution, and the use of power are always clear-cut.
True False
10. Ethical dilemmas are situations in which none of the available alternatives seems ethically acceptable.
True False
11. Societal business ethics are divorced from personal ethics.
True False
12. An individual with a strong sense of personal ethics is less likely to behave in an unethical manner in a
business setting.
True False
13. A firm's organizational culture refers to the values and norms that are shared among employees of an
organization.
True False
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Education.
14. The utilitarian approach to ethics is a straw men approach to business ethics that has some inherent
value, but is unsatisfactory in important ways.
True False
15. Milton Friedman's basic position is that the only social responsibility of business is to increase profits,
so long as the company stays within the rules of law.
True False
16. The Friedman doctrine is the belief that ethics are nothing more than a reflection of culture and
therefore, a firm should adopt the ethics of the culture in which it is operating.
True False
17. Cultural relativism suggests that even if slavery is culturally acceptable in a country, a foreign firm
operating in that country should avoid using slave labor.
True False
18. The righteous moralist approach to ethics is typically associated with managers from developing and
under-developed nations.
True False
19. Most moral philosophers see value in utilitarian and Kantian approaches to business ethics.
True False
20. Utilitarian philosophy takes into consideration the principle of justice.
True False
21. According to Rawls, inequalities are unjust even if the system that produces inequalities is to the
advantage of everyone.
True False
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Education.
22. Building an organization culture that places a high value on ethical behavior requires incentive and
reward systems.
True False
23. To establish moral intent, managers need to stand in the shoes of a stakeholder and ask how a
proposed decision might impact that stakeholder.
True False
24. To foster ethical behavior, many businesses draft a code of ethics, which is an informal statement of
the ethical priorities the company follows.
True False
25. Ethics officers are hired by many businesses to make sure that all employees are trained to be ethically
aware and that ethical considerations enter the business decision-making process at all levels of the
organization.
True False
Multiple Choice Questions
26. The _____ occurs when a resource held in common by all, but owned by no one, is overused by
individuals, resulting in its degradation.
A. tragedy of the commons

B. moral ignorance
C. noblesse oblige
D. veil of ignorance
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Education.
27. The _____ outlawed the paying of bribes to foreign government officials to gain business.
A. Convention on Combating Bribery of Foreign Public Officials

B. Foreign Corrupt Practices Act
C. Convention on International Business Transactions
D. Universal Declaration of Human Rights
28. Facilitating payments are also known as _____.
A. grease monkeying
B. pocket lining
C. speed money
D. sliding
29. _____ is a French term that refers to honorable and benevolent behavior considered the responsibility
of people of high (noble) birth.
A. Bienveillante
B. Honourable
C. Aristocratic
D. Noblesse oblige
30. Ethical dilemmas exist because many real-world decisions involve:
A. first-, second-, and third-order consequences that are hard to quantify.

B. people from different cultures.
C. employers and employees.
D. people from different multinational firms.
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Education.
31. Employees in a business often take their cue from _____.
A. other employees
B. business leaders
C. their families
D. government leaders
32. _____ approaches to business ethics are raised by business ethics scholars primarily to demonstrate
that they offer inappropriate ethical decision making in a multinational enterprise.
A. Cultural relativism
B. The righteous moralist
C. Straw men
D. The naive immoralist
33. _____ arguments suggest that improving working conditions beyond the level required by the law and
necessary to maximize employee productivity will reduce profits and are therefore not appropriate.
A. Rawls'
B. Kantian
C. Sullivan's
D. Friedman's
34. According to the _____ point-of-view, a firm should adopt the ethics of the culture in which it is
operating.
A. cultural relativism
B. righteous moralist
C. naïve immoralist
D. utilitarian approach
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Education.
35. According to the _____, even if a manager of a multinational sees that firms from other nations are not
following ethical norms in a host nation, that manager should maintain the standards of the company's
home country.
A. cultural relativist
C. utilitarian
D. naïve immoralist
36. An American firm that sets up production units in China is accused of releasing untreated chemical
waste into water bodies. The manager of the firm defends the firm stating that, factories in China set
up by French and British firms also release untreated chemical waste into water bodies. What approach
to business ethics is the manager using?
A. Righteous moralist
B. Utilitarian
C. Naive immoralist
D. Cultural relativist
37. The _____ approaches to ethics hold that the moral worth of actions or practices is determined by their
consequences.
A. naïve immoralist
B. cultural relativist
C. righteous moralist
D. utilitarian
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Education.
38. _____ recognize that human beings have fundamental rights and privileges that transcend national
boundaries and cultures.
A. Rights theories
B. Utilitarians
C. Cultural relativists
D. Kantian ethics
39. Talking with _____ is a good way to discern a potential employee's ethical predisposition.
A. human resource personnel

B. prior employers regarding someone's reputation
C. someone's psychologists
D. someone's family
40. A firm's _____ include customers, suppliers, and lenders.
A. internal stakeholders
B. clients
C. external stakeholders
D. community
41. _____ enables managers to walk away from a decision that is profitable but unethical.
A. Utilitarianism
B. Righteousness
C. Just distribution
D. Moral courage
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42. Companies can strengthen the _____ of employees by committing themselves to not retaliate against
employees who complain about unethical actions.
A. moral courage
B. code of ethics
C. ethical strategies
D. organizational culture
43. It is in the best interest of prospective employees to find out all they can about the:
A. external stakeholders of an organization.

B. ethical climate in an organization.
C. internal stakeholders of an organization.
D. corporate social responsibility actions of an organization.
44. Which of the following was designed to allow GM to operate ethically in South Africa as long as the
company did not obey the apartheid laws in its own South African operations?
A. Sullivan principles
B. The righteous moral system
C. Noblesse oblige
D. Cultural relativism
45. Identify the INCORRECT statement about environmental regulations.
A. Environmental regulations are often lacking in developing nations.

B. Environmental regulations are similar across developed and developing nations.
C. Developed nations have substantial regulations governing the emission of pollutants, the dumping
of toxic chemicals, and so on.
D. Inferior environmental regulations in host nations, as compared to home nation, can lead to ethical
issues.
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46. The _____ occurs when a resource is shared by all, but owned by no one, is overused by individuals,
resulting in its degradation.
A. Friedman effect
B. noblesse oblige
C. inequity aversion
D. tragedy of the commons
47. An international U.S.-based company sets up a production unit in a developing country with poor
environmental regulations. This contributes to the:
A. noblesse oblige situation.

B. inequity aversion.
C. global tragedy of the commons.
D. Friedman effect.
48. Which of the following observations about the Foreign Corrupt Practices Act is true?
A. The act outlawed the paying of bribes to foreign government officials to gain business.
B. There is enough evidence that it put U.S. firms at a competitive disadvantage.
C. The act originally allowed for "facilitating payments."
D. The Nike case was the impetus for the 1977 passage of this act.
49. Facilitating payments are:
A. a direct violation of the Foreign Corrupt Practices Act.

B. permitted so long as they designed only to gain exclusive preferential treatment.
C. used to secure contracts that would otherwise not be secured.
D. permitted under the amended Foreign Corrupt Practices Act.
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Education.
50. The Convention on Combating Bribery of Foreign Public Officials in International Business Transactions
excludes:
A. bribes made to secure contracts that would otherwise not be secured.

B. grease payments to gain exclusive preferential treatment.
C. facilitating payments made to expedite routine government action.
D. payments to government officials for special privileges.
51. The idea that businesspeople should consider the social consequences of economic actions when
making business decisions and that there should be a presumption in favor of decisions that have both
good economic and social consequences is known as:
A. moral relativism.
B. noblesse oblige.
C. ethical dilemma.
D. social responsibility.
52. Which of the following, in a business setting, is taken to mean benevolent behavior that is the
responsibility of successful enterprises?
A. Sullivan's principles
B. Ethical dilemma
C. Tragedy of the commons
D. Noblesse oblige
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Education.
53. BP, one of the world's largest oil companies, has made it part of the company policy to undertake
"social investments" in the countries where it does business. There was no economic reason for BP to
make this social investment, but the company believes it is morally obligated to give something back
to the societies that have made their success possible. BP's actions are an example of:
A. cultural relativism.
B. the Friedman doctrine.
C. noblesse oblige.
D. the tragedy of the commons.
54. A situation in which none of the available alternatives seems morally acceptable is called:
A. an ethical dilemma.
B. noblesse oblige.
C. the tragedy of the commons.
D. the free rider problem.
55. Expatriate managers may experience more than the usual degree of pressure to violate their personal
ethics because of which of the following?
A. They are surrounded by their ordinary social context and supporting culture.
B. They are psychologically and geographically closer to the parent company.
C. They may be based in a culture that does not place the same value on ethical norms important in
the manager's home country.
D. They may be surrounded by local employees who have more rigorous ethical standards.
56. Which of the following refers to the values and norms that the employees of an organization share?
A. Vision statement
B. Cultural relativism
C. Organization culture
D. Power orientation
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Education.
57. According to _____, the social responsibility of business is to increase profits, so long as the company
stays within the rules of law.
A. the naive immoralist

B. the righteous moralist
C. cultural relativism
D. the Friedman doctrine
58. According to the Friedman doctrine:
A. ethics are nothing more than the reflection of culture.

B. a multinational's home-country standards of ethics are inappropriate to follow in foreign countries.
C. businesses should not undertake social expenditures beyond those mandated by the law and
required for the efficient running of a business.
D. if a manager of a multinational sees that firms from other nations are not following environmental
legislation in a host nation, that manager should not either.
59. Cultural relativism suggests that:
A. a firm should adopt the ethics of the culture in which it is operating.

B. the only social responsibility of a firm is to increase profits.
C. a firm's ethical policies should remain the same in all cultures.
D. a multinational should follow its home-country cultural practices in all the host-countries where it
has operations.
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Education.
60. Child labor is permitted and widely employed in Country X. A multinational company entering Country
X decides to employ minors in its subsidiary, even though it is against the multinational's home-
country ethics. Which of the following approaches to business ethics would justify the actions of the
multinational company?
C. The justice theory
D. The rights theory
61. A multinational company is accused of paying bribes to the government of a host country to obtain
permission to build a production factory. The public relations manager of the company defends the
company's actions as being ethically sound; he states that in the host country, paying bribes to
government officials is the accepted norm and is in keeping with the social practices in the host
country. The public relations manager is using which of the following philosophical doctrines to defend
the actions of the company?
A. The Friedman doctrine

B. Righteous moralist
C. Noblesse oblige
62. In its extreme viewpoint, _____ suggests that if a culture supports slavery, it is all right to use slave labor
in the country.
A. the Friedman doctrine

B. noblesse oblige
D. cultural relativism
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63. The righteous moralist suggests that:

B. a multinational's home-country standards of ethics are the appropriate ones for companies to
follow in foreign countries.
C. the social responsibility of business is to increase profits, so long as the company stays within the
rules of law.
D. if a manager of a multinational sees that firms from other nations are not following ethical norms in
a host nation, that manager should not either.
64. According to the naive immoralist,
A. a multinational's home-country standards of ethics are the appropriate ones for companies to
B. the social responsibility of business is to increase profits, so long as the company stays within the
rules of law.
C. ethics are nothing more than the reflection of a culture.
D. if firms in a host nation do not follow ethical norms then the manager of a multinational should also
not follow ethical norms there.
65. An American manager in Colombia routinely pays off the local drug lord to guarantee that his plant
will not be bombed and that none of his employees will be kidnapped. The manager argues that such
payments are ethically defensible because everyone is doing it. The manager's argument exemplifies
which of the following ethical approaches?
A. Naive immoralist
B. Kantian ethics
C. Righteous moralist
D. Noblesse oblige
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66. The utilitarian approach to business ethics suggests that:
A. people should be treated as ends and never purely as means to the ends of others.
B. the moral worth of actions or practices is determined by their consequences.
C. people have dignity and need to be treated as such.
D. human beings have fundamental rights and privileges that transcend national cultures.
67. According to the _____ approach, the best decisions are those that produce the greatest good for the
greatest number of people.
A. naive immoralist
B. Friedman doctrine
C. Kantian ethics
D. utilitarian
68. The products of Carmen Stores, an international sports apparel chain, are manufactured in sweat
factories in China. According to the company president, using sweatshop labor offers a means of
livelihood to children and young adults, as well as supplies good quality apparel to customers at a
lower cost. She asserts that the actions of the company are justified because it results in the benefit of
the maximum number of people. The company president's argument is based on which of the
following ethical viewpoints?
A. The righteous moralist

B. The Friedman doctrine
C. Kantian approach to business ethics
D. Utilitarian approach to business ethics
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Education.
69. The Kantian approach to ethics suggests that:
A. human beings have fundamental rights and privileges that transcend national boundaries.
C. people should be treated as ends and never purely as means to the ends of others.
D. ethics are nothing more than the reflection of culture.
70. Identify the correct statement about the rights theories.
A. Human beings have fundamental rights and privileges that transcend national boundaries.
B. The moral worth of actions or practices is determined by their consequences.
C. People should be treated as ends never purely as means to the ends of others.
D. The only social responsibility of business is to increase profits, so long as the company stays within
the rules of law.
71. Which of the following persons believed that people should be treated as ends and never purely as
means to the ends of others?
A. John Stuart Mill

B. Immanuel Kant
C. Milton Friedman
D. David Hume
72. The United Nations Universal Declaration of Human Rights, related to employment, upholds which of
the following?
A. The requirement for the formation of trade unions.

B. A sliding pay scale based upon need.
C. Prohibition of trade unions.
D. Protection against unemployment.
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Education.
73. Article 1 of the United Nations Universal Declaration of Human Rights states: All human beings are
born free and equal in dignity and rights. This best echoes:
B. Friedman doctrine.
C. the righteous moralist approach.
D. Kantian ethics.
74. Which of the following statements is true about the United Nations Universal Declaration of Human
Rights?
A. It transcends national borders.

B. It states that human rights are culturally determined.
C. It states that an action is judged desirable if it leads to the best possible balance of good
consequences over bad consequences.
D. It states that the only social responsibility of business is to increase profits, so long as the company
stays within the rules of law.
75. Justice theories of business ethics focus on:
A. the moral worth of actions or practices.

B. minimum levels of morally acceptable behavior.
C. fundamental rights and privileges that transcend national boundaries.
D. the attainment of an equitable distribution of goods and services.
76. According to John Rawls:
A. each person should be permitted the maximum amount of basic liberty compatible with a similar
liberty for others.
B. freedom of speech and assembly is the single most important component in a justice system.
C. equal basic liberty is impossible in a pure market economy.
D. ethics is culturally determined.
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Education.
77. Rawls' philosophy that inequalities are justified if they benefit the position of the least-advantaged
person is known as the:
A. inequality principle.
B. equity principle.
C. difference principle.
D. ignorance veil principle.
78. According to John Rawls's difference principle,
A. certain people or institutions are obligated to provide benefits or services that secure the rights of
others.
B. fundamental human rights should transcend national borders and cultures.
C. the best decisions are those that produce the greatest good for the greatest number of people.
D. inequalities are justified if they benefit the position of the least-advantaged person.
79. External stakeholders:
A. are individuals or groups who own the business.

B. include all employees, the board of directors, and stockholders.
C. typically comprise customers, suppliers, lenders, etc.
D. are individuals or groups who work for the business.
80. Which of the following is an example of an external stakeholder?
A. Employees
B. Customers
C. Stockholders
D. The board of directors
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Education.
81. _____ means standing in the shoes of a stakeholder and asking how a proposed decision might impact
that stakeholder.
A. Veil of ignorance
B. Difference principle
C. Moral imagination
D. Noblesse oblige
82. Establishing _____ involves a business to resolve to place moral concerns ahead of other concerns in
cases where either the fundamental rights of stakeholders or key moral principles have been violated.
A. a veil of ignorance
B. a difference principle
C. moral imagination
D. moral intent
83. Which of the following enables managers to walk away from a decision that is profitable, but
unethical?
A. Noblesse oblige
B. Moral courage
C. The difference principle
D. The Friedman doctrine
84. What is the term for a company's formal statement of the ethical priorities it expects all of its
employees to follow?
A. Code of ethics
B. Stakeholders pledge
C. Moral courage
D. Difference principle
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Education.
85. Business ethics that either deny the value of business ethics or apply the concept in a very
unsatisfactory way are termed _____.
A. straw men
B. the Sullivan principles
C. just distribution
D. rights theories
86. Which of the following ethical theories explicitly rejects the idea that businesses should undertake
social expenditures beyond those mandated by the law and required for the efficient running of a
business?
A. The naive immoralist

C. Cultural relativism
D. The righteous moralist
87. A(n) _____ asserts that if a manager of a multinational sees that firms from other nations are not
following ethical norms in a host nation, that manager should not either.
A. Kantian ethicist
C. naive immoralist
D. utilitarian ethicist
88. Any person or institution that is capable of moral action such as a government or corporation is a(n)
_____.
A. moral agent
B. utilitarian
D. naive immoralist
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Education.
89. Under the veil of ignorance, everyone is imagined to be ignorant of:
A. all of his/her particular characteristics.

B. fundamental rights and privileges.
C. the moral worth of actions or practices.
D. the minimum levels of morally acceptable behavior.
90. _____ are the accepted principles of right or wrong governing the conduct of businesspeople.
A. Sustainable strategies
B. Business ethics
C. Moral worth of actions
D. Ethical strategies
91. The veil of ignorance was developed by _____ as part of his approach to justice theories.
A. Milton Friedman
B. John Rawls
C. Kantian
D. Leon Sullivan
92. Often, the code of ethics draws heavily upon documents such as the _____, which itself is grounded in
Kantian and rights-based theories of moral philosophy.

D. UN Universal Declaration of Human Rights
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Education.
93. Which of the following is a reason why managers behave in a manner that is unethical?
A. Psychological and geographical distances of a foreign subsidiary from the home office
B. Pressure from an ethical leader
C. Confusion between personal ethics and business ethics
D. Incorporating ethical issues into strategic and operational decision making
94. In the international business setting, one of the most common ethical issues involves _____.
A. hiring practices
B. government deregulation
C. the moral obligation of multinational corporations
D. facilitating payments
95. The _____ obliges member states to make the bribery of foreign public officials a criminal offense and
excludes facilitating payments made to expedite routine government action from the convention.

Essay Questions
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Education.
96. Discuss how companies such as Exxon, Kodak, and IBM helped improve human rights in South Africa.
97. Should a multinational feel free to pollute in a developing nation?
98. In your opinion, are bribes ever acceptable? Why or why not?
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Education.
99. Discuss the notion of social responsibility. What does it mean for corporations?
100. What are ethical dilemmas? Why do they exist?
101. Why are expatriate managers at a greater risk of violating their personal code of ethics?
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Education.
102. Explain the Friedman doctrine. Who developed the philosophy? How well does this approach hold up
ethically?
103. Discuss the cultural relativism approach to business ethics. What is the connection between this
approach and the phrase "When in Rome do as the Romans"? How well does this approach hold up
ethically?
104. Discuss the naive immoralist's approach to business ethics. What are the criticisms of this approach?
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Education.
105. Discuss the utilitarian approach to business ethics. When was this approach developed? What are its
drawbacks?
106. What are the ways in which international business and its managers can ensure that ethical issues are
considered in business decisions?
107. Describe the five-step process that businesses can use to think through ethical problems.
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Education.
108. Why do organizations appoint an ethics officer?
109. How can companies strengthen the moral courage of employees?
110. Explain the concept of moral imagination as it relates to a company's stakeholders.
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Education.
Chapter 05 Ethics, Corporate Social Responsibility, and Sustainability Answer
Key
True / False Questions
1. Ethical strategies are the accepted principles of right or wrong governing the conduct of
businesspeople.
FALSE
An ethical strategy is a strategy, or course of action, that does not violate the accepted principles of
right or wrong governing the conduct of businesspeople.
AACSB: Ethics
Accessibility: Keyboard Navigation
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
Learning Objective: 05-01 Understand the ethical issues faced by international businesses.
Topic: Ethical Issues in International Business
2. What is considered normal business practice in one country may be considered unethical in other
countries.
TRUE
Many of the ethical issues in international business are rooted in the fact that political systems, law,
economic development, and culture vary significantly from nation to nation. What is considered
normal practice in one nation may be considered unethical in another.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-29
Education.
3. The Sullivan principles mandated that GM could operate in South Africa as long as the company
complied with the apartheid laws.
FALSE
GM adopted the Sullivan principles. Sullivan argued that it was ethically justified for GM to operate
in South Africa so long as two conditions were fulfilled. First, the company should not obey the
apartheid laws in its own South African operations. Second, the company should do everything
within its power to promote the abolition of apartheid laws.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
4. Corporations can contribute to the global tragedy of the commons by not pumping pollutants into
the atmosphere or dumping them in oceans or rivers.
FALSE
In the modern world, corporations can contribute to the global tragedy of the commons by moving
production to locations where they are free to pump pollutants into the atmosphere or dump them
in oceans or rivers, thereby harming these valuable global commons.
AACSB: Ethics
Blooms: Understand
Difficulty: 2 Medium
Gradable: automatic
5-30
Education.
5. International businesses cannot gain economic advantages by making payments to corrupt
government officials.
FALSE
There always have been and always will be corrupt government officials. International businesses
can and have gained economic advantages by making payments to those officials.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
6. The Foreign Corrupt Practices Act originally allowed "facilitating payments" to secure contracts that
would not otherwise be secured.
FALSE
The Foreign Corrupt Practices Act was subsequently amended to allow for "facilitating payments."
Sometimes known as speed money or grease payments, facilitating payments are not payments to
secure contracts that would not otherwise be secured and nor are they payments to obtain
exclusive preferential treatment.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
Topic: Key Regulations Governing Ethics and Social Responsibility
5-31
Education.
7. In a business setting, noblesse oblige is taken to mean benevolent behavior that is the responsibility
of successful enterprises.
TRUE
Noblesse oblige is a French term that refers to honorable and benevolent behavior considered the
responsibility of people of high (noble) birth. In a business setting, it is taken to mean benevolent
behavior that is the responsibility of successful enterprises.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
8. Social responsibility refers to the idea that businesspeople should favor decisions that have both
good economic and social consequences.
TRUE
The concept of social responsibility refers to the idea that businesspeople should consider the
social consequences of economic actions when making business decisions, and that there should
be a presumption in favor of decisions that have both good economic and social consequences.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-32
Education.
9. The ethical obligations of a multinational corporation toward employment conditions, human
rights, environmental pollution, and the use of power are always clear-cut.
FALSE
The ethical obligations of a multinational corporation toward employment conditions, human

rights, corruption, environmental pollution, and the use of power are not always clear-cut.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
Learning Objective: 05-02 Recognize an ethical dilemma.
Topic: Ethical Decision Making
10. Ethical dilemmas are situations in which none of the available alternatives seems ethically
acceptable.
TRUE
Ethical dilemmas are situations in which none of the available alternatives seems ethically
acceptable.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-33
Education.
11. Societal business ethics are divorced from personal ethics.
FALSE
Societal business ethics are not divorced from personal ethics, which are the generally accepted
principles of right and wrong governing the conduct of individuals.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
Learning Objective: 05-03 Identify the causes of unethical behavior by managers.
Topic: Causes of Unethical Behavior
12. An individual with a strong sense of personal ethics is less likely to behave in an unethical manner
in a business setting.
TRUE
Our personal ethical code exerts a profound influence on the way we behave as businesspeople. An
individual with a strong sense of personal ethics is less likely to behave in an unethical manner in a
business setting.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-34
Education.
13. A firm's organizational culture refers to the values and norms that are shared among employees of
an organization.
TRUE
The term organization culture refers to the values and norms that are shared among employees of
an organization.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
14. The utilitarian approach to ethics is a straw men approach to business ethics that has some
inherent value, but is unsatisfactory in important ways.
FALSE
Straw men approaches to business ethics can be characterized as the Friedman doctrine, cultural
relativism, the righteous moralist, and the naive immoralist.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
Learning Objective: 05-04 Describe the different philosophical approaches to ethics.
Topic: Philosophical Approaches to Ethics
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Education.
15. Milton Friedman's basic position is that the only social responsibility of business is to increase
profits, so long as the company stays within the rules of law.
TRUE
The Nobel Prize-winning economist Milton Friedman wrote an article in 1970 that has since become
a classic straw man that business ethics scholars outline only to then tear down. Friedman's basic
position is that the only social responsibility of business is to increase profits, so long as the
company stays within the rules of law.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
16. The Friedman doctrine is the belief that ethics are nothing more than a reflection of culture and
therefore, a firm should adopt the ethics of the culture in which it is operating.
FALSE
Friedman's basic position is that the only social responsibility of business is to increase profits, so
long as the company stays within the rules of law. He explicitly rejects the idea that businesses
should undertake social expenditures beyond those mandated by the law and required for the
efficient running of a business.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
5-36
Education.
17. Cultural relativism suggests that even if slavery is culturally acceptable in a country, a foreign firm
operating in that country should avoid using slave labor.
FALSE
At its extreme, cultural relativism suggests that if a culture supports slavery, it is OK to use slave
labor in a country.
AACSB: Ethics
Blooms: Analyze
Gradable: automatic
18. The righteous moralist approach to ethics is typically associated with managers from developing
and under-developed nations.
FALSE
A righteous moralist claims that a multinational's home-country standards of ethics are the
appropriate ones for companies to follow in foreign countries. This approach is typically associated
with managers from developed nations.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
5-37
Education.
19. Most moral philosophers see value in utilitarian and Kantian approaches to business ethics.
TRUE
In contrast to the straw men approaches to ethics, most moral philosophers see value in utilitarian
and Kantian approaches to business ethics.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
20. Utilitarian philosophy takes into consideration the principle of justice.
FALSE
The problem with utilitarianism is that the philosophy omits the consideration of justice. The action
that produces the greatest good for the greatest number of people may result in the unjustified
treatment of a minority.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
5-38
Education.
21. According to Rawls, inequalities are unjust even if the system that produces inequalities is to the
advantage of everyone.
FALSE
Rawls accepts that inequalities can be just if the system that produces inequalities is to the
advantage of everyone. More precisely, he formulates what he calls the difference principle, which
is that inequalities are justified if they benefit the position of the least-advantaged person.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
22. Building an organization culture that places a high value on ethical behavior requires incentive and
reward systems.
TRUE
Building an organization culture that places a high value on ethical behavior requires incentive and
reward systems, including promotions that reward people who engage in ethical behavior and
sanction those who do not.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
Learning Objective: 05-05 Explain how managers can incorporate ethical considerations into their decision making.
5-39
Education.
23. To establish moral intent, managers need to stand in the shoes of a stakeholder and ask how a
proposed decision might impact that stakeholder.
FALSE
Managers need to establish moral intent, to be able to think through ethical problems. This means
the business must resolve to place moral concerns ahead of other concerns in cases where either
the fundamental rights of stakeholders or key moral principles have been violated.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
24. To foster ethical behavior, many businesses draft a code of ethics, which is an informal statement of
the ethical priorities the company follows.
FALSE
To foster ethical behavior, businesses need to build an organization that values ethical behavior. To
do this, many companies now draft a code of ethics, which is a formal statement of the ethical
priorities a business adheres to.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
5-40
Education.
25. Ethics officers are hired by many businesses to make sure that all employees are trained to be
ethically aware and that ethical considerations enter the business decision-making process at all
levels of the organization.
TRUE
To make sure that a business behaves in an ethical manner, a number of firms now have ethics
officers. These individuals are responsible for making sure that all employees are trained to be
ethically aware, that ethical considerations enter the business decision-making process, and that the
company's code of ethics if followed.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
Multiple Choice Questions
26. The _____ occurs when a resource held in common by all, but owned by no one, is overused by
individuals, resulting in its degradation.
A. tragedy of the commons

B. moral ignorance
C. noblesse oblige
D. veil of ignorance
The tragedy of the commons occurs when a resource held in common by all, but owned by no one,
is overused by individuals, resulting in its degradation. The phenomenon was first named by Garrett
Hardin when describing a particular problem in sixteenth-century England.
AACSB: Ethics
5-41
Education.
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
27. The _____ outlawed the paying of bribes to foreign government officials to gain business.

The Lockheed case was the impetus for the 1977 passage of the Foreign Corrupt Practices Act in
the United States. The act outlawed the paying of bribes to foreign government officials to gain
business.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-42
Education.
28. Facilitating payments are also known as _____.
A. grease monkeying
B. pocket lining
C. speed money
D. sliding
Sometimes known as speed money or grease payments, facilitating payments are not payments to
secure contracts that would not otherwise be secured and nor are they payments to obtain
exclusive preferential treatment.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
29. _____ is a French term that refers to honorable and benevolent behavior considered the
responsibility of people of high (noble) birth.
A. Bienveillante
B. Honourable
C. Aristocratic
D. Noblesse oblige
responsibility of people of high (noble) birth.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-43
Education.
30. Ethical dilemmas exist because many real-world decisions involve:
A. first-, second-, and third-order consequences that are hard to quantify.

B. people from different cultures.
C. employers and employees.
D. people from different multinational firms.
Ethical dilemmas exist because many real-world decisions are complex, difficult to frame, and
involve first-, second-, and third-order consequences that are hard to quantify. Doing the right
thing, or even knowing what the right thing might be, is often far from easy.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
31. Employees in a business often take their cue from _____.
A. other employees
B. business leaders
C. their families
D. government leaders
Leaders help to establish the culture of an organization, and they set the example that others
follow. Other employees in a business often take their cue from business leaders, and if those
leaders do not behave in an ethical manner, they might not either.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-44
Education.
32. _____ approaches to business ethics are raised by business ethics scholars primarily to demonstrate
that they offer inappropriate ethical decision making in a multinational enterprise.
A. Cultural relativism
B. The righteous moralist
C. Straw men
D. The naive immoralist
Straw men approaches to business ethics are raised by business ethics scholars primarily to
demonstrate that they offer inappropriate guidelines for ethical decision making in a multinational
enterprise.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
33. _____ arguments suggest that improving working conditions beyond the level required by the law
and necessary to maximize employee productivity will reduce profits and are therefore not
appropriate.
A. Rawls'
B. Kantian
C. Sullivan's
D. Friedman's
Friedman explicitly rejects the idea that businesses should undertake social expenditures beyond
those mandated by the law and required for the efficient running of a business.
AACSB: Ethics
Blooms: Understand
5-45
Education.
Gradable: automatic
34. According to the _____ point-of-view, a firm should adopt the ethics of the culture in which it is
operating.
A. cultural relativism
C. naïve immoralist
D. utilitarian approach
Cultural relativism is the belief that ethics are nothing more than the reflection of a culture—all
ethics are culturally determined—and that accordingly, a firm should adopt the ethics of the culture
in which it is operating.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
5-46
Education.
35. According to the _____, even if a manager of a multinational sees that firms from other nations are
not following ethical norms in a host nation, that manager should maintain the standards of the
company's home country.
A. cultural relativist
C. utilitarian
D. naïve immoralist
appropriate ones for companies to follow in foreign countries.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
36. An American firm that sets up production units in China is accused of releasing untreated chemical
waste into water bodies. The manager of the firm defends the firm stating that, factories in China
set up by French and British firms also release untreated chemical waste into water bodies. What
approach to business ethics is the manager using?
B. Utilitarian
C. Naive immoralist
D. Cultural relativist
A naive immoralist asserts that if a manager of a multinational sees that firms from other nations
are not following ethical norms in a host nation, that manager should not either.
AACSB: Ethics
AACSB: Reflective Thinking
5-47
Education.
Blooms: Apply
Gradable: automatic
37. The _____ approaches to ethics hold that the moral worth of actions or practices is determined by
their consequences.
A. naïve immoralist
B. cultural relativist
D. utilitarian
Utilitarian approaches to ethics hold that the moral worth of actions or practices is determined by
their consequences. An action is judged desirable if it leads to the best possible balance of good
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-48
Education.
38. _____ recognize that human beings have fundamental rights and privileges that transcend national
boundaries and cultures.
A. Rights theories
B. Utilitarians
C. Cultural relativists
D. Kantian ethics
Developed in the twentieth century, rights theories recognize that human beings have fundamental
rights and privileges that transcend national boundaries and cultures. Rights establish a minimum
level of morally acceptable behavior.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
39. Talking with _____ is a good way to discern a potential employee's ethical predisposition.
A. human resource personnel

B. prior employers regarding someone's reputation
C. someone's psychologists
D. someone's family
Businesses can give potential employees psychological tests to try to discern their ethical
predisposition, and they can check with prior employees regarding someone's reputation (e.g., by
asking for letters of reference and talking to people who have worked with the prospective
employee). The latter is common and does influence the hiring process.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
5-49
Education.
40. A firm's _____ include customers, suppliers, and lenders.
A. internal stakeholders
B. clients
C. external stakeholders
D. community
Internal stakeholders are individuals or groups who work for or own the business. External
stakeholders are all other individuals and groups that have some claim on the firm. Typically, this
group comprises customers, suppliers, lenders, governments, unions, local communities, and the
general public.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
41. _____ enables managers to walk away from a decision that is profitable but unethical.
A. Utilitarianism
B. Righteousness
C. Just distribution
D. Moral courage
It is important to recognize that employees in an international business may need significant moral
courage. Moral courage enables managers to walk away from a decision that is profitable but
unethical.
AACSB: Ethics
Blooms: Remember
5-50
Education.
Difficulty: 1 Easy
Gradable: automatic
42. Companies can strengthen the _____ of employees by committing themselves to not retaliate
against employees who complain about unethical actions.
A. moral courage
B. code of ethics
C. ethical strategies
D. organizational culture
Companies can strengthen the moral courage of employees by committing themselves to not
retaliate against employees who exercise moral courage, say no to superiors, or otherwise complain
about unethical actions.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
43. It is in the best interest of prospective employees to find out all they can about the:
A. external stakeholders of an organization.

B. ethical climate in an organization.
C. internal stakeholders of an organization.
D. corporate social responsibility actions of an organization.
Not only should businesses strive to identify and hire people with a strong sense of personal ethics,
but it also is in the best interest of prospective employees to find out as much as they can about
the ethical climate in an organization.
AACSB: Ethics
5-51
Education.
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
Topic: Ethics and Social Responsibility
44. Which of the following was designed to allow GM to operate ethically in South Africa as long as the
company did not obey the apartheid laws in its own South African operations?
A. Sullivan principles
B. The righteous moral system
C. Noblesse oblige
GM adopted what came to be called the Sullivan principles, named after Leon Sullivan, a black
Baptist minister and a member of GM's board of directors. Sullivan argued that it was ethically
justified for GM to operate in South Africa so long as certain conditions were fulfilled.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
5-52
Education.
45. Identify the INCORRECT statement about environmental regulations.
A. Environmental regulations are often lacking in developing nations.

B. Environmental regulations are similar across developed and developing nations.
C. Developed nations have substantial regulations governing the emission of pollutants, the
dumping of toxic chemicals, and so on.
D. Inferior environmental regulations in host nations, as compared to home nation, can lead to
ethical issues.
Many developed nations have substantial regulations governing the emission of pollutants, the
dumping of toxic chemicals, the use of toxic materials in the workplace, and so on. Those
regulations are often lacking in developing nations, and according to critics, the result can be
higher levels of pollution from the operations of multinationals than would be allowed at home.
AACSB: Ethics
Blooms: Analyze
Gradable: automatic
46. The _____ occurs when a resource is shared by all, but owned by no one, is overused by individuals,
resulting in its degradation.
A. Friedman effect
B. noblesse oblige
C. inequity aversion
D. tragedy of the commons
The tragedy of the commons occurs when a resource held in common by all, but owned by no one,
is overused by individuals, resulting in its degradation.
AACSB: Ethics
Blooms: Remember
5-53
Education.
Difficulty: 1 Easy
Gradable: automatic
47. An international U.S.-based company sets up a production unit in a developing country with poor
environmental regulations. This contributes to the:
A. noblesse oblige situation.

B. inequity aversion.
C. global tragedy of the commons.
D. Friedman effect.
In the modern world, corporations can contribute to the global tragedy of the commons by moving
production to locations where they are free to pump pollutants into the atmosphere or dump them
in oceans or rivers, thereby harming these valuable global commons.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
48. Which of the following observations about the Foreign Corrupt Practices Act is true?
A. The act outlawed the paying of bribes to foreign government officials to gain business.
B. There is enough evidence that it put U.S. firms at a competitive disadvantage.
C. The act originally allowed for "facilitating payments."
D. The Nike case was the impetus for the 1977 passage of this act.
The Lockheed case was the impetus for the 1977 passage of the Foreign Corrupt Practices Act in
the United States. The act outlawed the paying of bribes to foreign government officials to gain
business.
AACSB: Ethics
5-54
Education.
Blooms: Apply
Gradable: automatic
49. Facilitating payments are:
A. a direct violation of the Foreign Corrupt Practices Act.

B. permitted so long as they designed only to gain exclusive preferential treatment.
C. used to secure contracts that would otherwise not be secured.
D. permitted under the amended Foreign Corrupt Practices Act.
Sometimes known as speed money or grease payments, facilitating payments are payments to
ensure receiving the standard treatment that a business ought to receive from a foreign
government, but might not due to the obstruction of a foreign official.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
5-55
Education.
50. The Convention on Combating Bribery of Foreign Public Officials in International Business
Transactions excludes:
A. bribes made to secure contracts that would otherwise not be secured.

B. grease payments to gain exclusive preferential treatment.
C. facilitating payments made to expedite routine government action.
D. payments to government officials for special privileges.
The Convention on Combating Bribery of Foreign Public Officials in International Business

Transactions excludes facilitating payments made to expedite routine government action from the
convention.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
51. The idea that businesspeople should consider the social consequences of economic actions when
making business decisions and that there should be a presumption in favor of decisions that have
both good economic and social consequences is known as:
A. moral relativism.
B. noblesse oblige.
C. ethical dilemma.
D. social responsibility.
be a presumption in favor of decisions that have both good economic and social consequences.
AACSB: Ethics
Blooms: Remember
5-56
Education.
Difficulty: 1 Easy
Gradable: automatic
52. Which of the following, in a business setting, is taken to mean benevolent behavior that is the
responsibility of successful enterprises?
A. Sullivan's principles
B. Ethical dilemma
C. Tragedy of the commons
D. Noblesse oblige
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-57
Education.
53. BP, one of the world's largest oil companies, has made it part of the company policy to undertake
"social investments" in the countries where it does business. There was no economic reason for BP
to make this social investment, but the company believes it is morally obligated to give something
back to the societies that have made their success possible. BP's actions are an example of:
B. the Friedman doctrine.
C. noblesse oblige.
D. the tragedy of the commons.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
54. A situation in which none of the available alternatives seems morally acceptable is called:
A. an ethical dilemma.
B. noblesse oblige.
C. the tragedy of the commons.
D. the free rider problem.
acceptable.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-58
Education.
55. Expatriate managers may experience more than the usual degree of pressure to violate their
personal ethics because of which of the following?
A. They are surrounded by their ordinary social context and supporting culture.
B. They are psychologically and geographically closer to the parent company.
C. They may be based in a culture that does not place the same value on ethical norms important
in the manager's home country.
D. They may be surrounded by local employees who have more rigorous ethical standards.
Home-country managers working abroad in multinational firms (expatriate managers) may

experience more than the usual degree of pressure to violate their personal ethics. They are away
from their ordinary social context and supporting culture, and they are psychologically and
geographically distant from the parent company.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
5-59
Education.
56. Which of the following refers to the values and norms that the employees of an organization
share?
A. Vision statement
C. Organization culture
D. Power orientation
The term organization culture refers to the values and norms that are shared among employees of
an organization.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
57. According to _____, the social responsibility of business is to increase profits, so long as the
A. the naive immoralist

B. the righteous moralist
C. cultural relativism
D. the Friedman doctrine
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-60
Education.
58. According to the Friedman doctrine:

B. a multinational's home-country standards of ethics are inappropriate to follow in foreign
countries.
C. businesses should not undertake social expenditures beyond those mandated by the law and
required for the efficient running of a business.
D. if a manager of a multinational sees that firms from other nations are not following
environmental legislation in a host nation, that manager should not either.
Friedman explicitly rejects the idea that businesses should undertake social expenditures beyond
those mandated by the law and required for the efficient running of a business.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
5-61
Education.
59. Cultural relativism suggests that:
A. a firm should adopt the ethics of the culture in which it is operating.

B. the only social responsibility of a firm is to increase profits.
C. a firm's ethical policies should remain the same in all cultures.
D. a multinational should follow its home-country cultural practices in all the host-countries where
it has operations.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
60. Child labor is permitted and widely employed in Country X. A multinational company entering
Country X decides to employ minors in its subsidiary, even though it is against the multinational's
home-country ethics. Which of the following approaches to business ethics would justify the actions
of the multinational company?
C. The justice theory
D. The rights theory
AACSB: Ethics
5-62
Education.
Blooms: Apply
Difficulty: 3 Hard
Gradable: automatic
61. A multinational company is accused of paying bribes to the government of a host country to obtain
permission to build a production factory. The public relations manager of the company defends the
company's actions as being ethically sound; he states that in the host country, paying bribes to
government officials is the accepted norm and is in keeping with the social practices in the host
country. The public relations manager is using which of the following philosophical doctrines to
defend the actions of the company?
A. The Friedman doctrine

B. Righteous moralist
C. Noblesse oblige
AACSB: Ethics
Blooms: Apply
Difficulty: 3 Hard
Gradable: automatic
5-63
Education.
62. In its extreme viewpoint, _____ suggests that if a culture supports slavery, it is all right to use slave
labor in the country.
A. the Friedman doctrine

B. noblesse oblige
D. cultural relativism
Cultural relativism does not stand up to a closer look. At its extreme, cultural relativism suggests
that if a culture supports slavery, it is OK to use slave labor in a country.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
63. The righteous moralist suggests that:

B. a multinational's home-country standards of ethics are the appropriate ones for companies to
C. the social responsibility of business is to increase profits, so long as the company stays within
the rules of law.
D. if a manager of a multinational sees that firms from other nations are not following ethical
norms in a host nation, that manager should not either.
appropriate ones for companies to follow in foreign countries. This approach is typically associated
with managers from developed nations.
AACSB: Ethics
Blooms: Remember
5-64
Education.
Difficulty: 1 Easy
Gradable: automatic
64. According to the naive immoralist,
A. a multinational's home-country standards of ethics are the appropriate ones for companies to
B. the social responsibility of business is to increase profits, so long as the company stays within
the rules of law.
C. ethics are nothing more than the reflection of a culture.
D. if firms in a host nation do not follow ethical norms then the manager of a multinational should
also not follow ethical norms there.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
5-65
Education.
65. An American manager in Colombia routinely pays off the local drug lord to guarantee that his plant
will not be bombed and that none of his employees will be kidnapped. The manager argues that
such payments are ethically defensible because everyone is doing it. The manager's argument
exemplifies which of the following ethical approaches?
A. Naive immoralist
B. Kantian ethics
C. Righteous moralist
D. Noblesse oblige
are not following ethical norms in a host nation, that manager should not either. The classic
example to illustrate the approach is known as the drug lord problem.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
66. The utilitarian approach to business ethics suggests that:
A. people should be treated as ends and never purely as means to the ends of others.
C. people have dignity and need to be treated as such.
D. human beings have fundamental rights and privileges that transcend national cultures.
Utilitarian approaches to ethics hold that the moral worth of actions or practices is determined by
their consequences. An action is judged desirable if it leads to the best possible balance of good
AACSB: Ethics
Blooms: Remember
5-66
Education.
Difficulty: 1 Easy
Gradable: automatic
67. According to the _____ approach, the best decisions are those that produce the greatest good for
the greatest number of people.
A. naive immoralist
B. Friedman doctrine
C. Kantian ethics
D. utilitarian
The best decisions, from a utilitarian perspective, are those that produce the greatest good for the
greatest number of people.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-67
Education.
68. The products of Carmen Stores, an international sports apparel chain, are manufactured in sweat
factories in China. According to the company president, using sweatshop labor offers a means of
livelihood to children and young adults, as well as supplies good quality apparel to customers at a
lower cost. She asserts that the actions of the company are justified because it results in the benefit
of the maximum number of people. The company president's argument is based on which of the
following ethical viewpoints?
A. The righteous moralist

C. Kantian approach to business ethics
D. Utilitarian approach to business ethics
As a philosophy for business ethics, utilitarianism focuses attention on the need to weigh carefully
all of the social benefits and costs of a business action and to pursue only those actions where the
benefits outweigh the costs. The best decisions, from a utilitarian perspective, are those that
produce the greatest good for the greatest number of people.
AACSB: Ethics
Blooms: Apply
Difficulty: 3 Hard
Gradable: automatic
5-68
Education.
69. The Kantian approach to ethics suggests that:
A. human beings have fundamental rights and privileges that transcend national boundaries.
C. people should be treated as ends and never purely as means to the ends of others.
D. ethics are nothing more than the reflection of culture.
Kantian ethics hold that people should be treated as ends and never purely as means to the ends
of others.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
70. Identify the correct statement about the rights theories.
A. Human beings have fundamental rights and privileges that transcend national boundaries.
B. The moral worth of actions or practices is determined by their consequences.
C. People should be treated as ends never purely as means to the ends of others.
D. The only social responsibility of business is to increase profits, so long as the company stays
within the rules of law.
Developed in the twentieth century, rights theories recognize that human beings have fundamental
rights and privileges that transcend national boundaries and cultures.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
5-69
Education.
71. Which of the following persons believed that people should be treated as ends and never purely as
means to the ends of others?
A. John Stuart Mill

B. Immanuel Kant
C. Milton Friedman
D. David Hume
Kantian ethics are based on the philosophy of Immanuel Kant (1724-1804). Kantian ethics hold that
people should be treated as ends and never purely as means to the ends of others. People are not
instruments, like a machine.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
72. The United Nations Universal Declaration of Human Rights, related to employment, upholds which
of the following?
A. The requirement for the formation of trade unions.

B. A sliding pay scale based upon need.
C. Prohibition of trade unions.
D. Protection against unemployment.
Article 23 of the United Nations Universal Declaration of Human Rights states: Everyone has the
right to form and to join trade unions for the protection of his interests.
AACSB: Ethics
Blooms: Analyze
Gradable: automatic
5-70
Education.
73. Article 1 of the United Nations Universal Declaration of Human Rights states: All human beings are
born free and equal in dignity and rights. This best echoes:
B. Friedman doctrine.
C. the righteous moralist approach.
D. Kantian ethics.
Echoing Kantian ethics, Article 1 of the United Nations Universal Declaration of Human Rights states:
All human beings are born free and equal in dignity and rights. They are endowed with reason and
conscience and should act towards one another in a spirit of brotherhood.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
5-71
Education.
74. Which of the following statements is true about the United Nations Universal Declaration of Human
Rights?
A. It transcends national borders.

B. It states that human rights are culturally determined.
C. It states that an action is judged desirable if it leads to the best possible balance of good
D. It states that the only social responsibility of business is to increase profits, so long as the
The notion that there are fundamental rights that transcend national borders and cultures was the
underlying motivation for the United Nations Universal Declaration of Human Rights, which has
been ratified by almost every country on the planet and lays down basic principles that should
always be adhered to irrespective of the culture in which one is doing business.
AACSB: Ethics
Blooms: Understand
Gradable: automatic
75. Justice theories of business ethics focus on:
A. the moral worth of actions or practices.

B. minimum levels of morally acceptable behavior.
C. fundamental rights and privileges that transcend national boundaries.
D. the attainment of an equitable distribution of goods and services.
A just distribution is one that is considered fair and equitable. Rawls argues that all economic goods
and services should be distributed equally except when an unequal distribution would work to
everyone's advantage.
AACSB: Ethics
5-72
Education.
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
76. According to John Rawls:
A. each person should be permitted the maximum amount of basic liberty compatible with a
similar liberty for others.
B. freedom of speech and assembly is the single most important component in a justice system.
C. equal basic liberty is impossible in a pure market economy.
D. ethics is culturally determined.
According to Rawls, valid principles of justice are those with which all persons would agree if they
could freely and impartially consider the situation. One such principle is that each person be
permitted the maximum amount of basic liberty compatible with a similar liberty for others.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-73
Education.
77. Rawls' philosophy that inequalities are justified if they benefit the position of the least-advantaged
person is known as the:
A. inequality principle.
B. equity principle.
C. difference principle.
D. ignorance veil principle.
John Rawls formulated what he called the difference principle, which is that inequalities are justified
if they benefit the position of the least-advantaged person.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
78. According to John Rawls's difference principle,
A. certain people or institutions are obligated to provide benefits or services that secure the rights
of others.
B. fundamental human rights should transcend national borders and cultures.
C. the best decisions are those that produce the greatest good for the greatest number of people.
D. inequalities are justified if they benefit the position of the least-advantaged person.
John Rawls formulated what he called the difference principle, which is that inequalities are justified
if they benefit the position of the least-advantaged person.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
5-74
Education.
79. External stakeholders:
A. are individuals or groups who own the business.

B. include all employees, the board of directors, and stockholders.
C. typically comprise customers, suppliers, lenders, etc.
D. are individuals or groups who work for the business.
External stakeholders are all other individuals and groups that have some claim on the firm.
Typically, this group comprises customers, suppliers, lenders, governments, unions, local
communities, and the general public.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
80. Which of the following is an example of an external stakeholder?
A. Employees
B. Customers
C. Stockholders
D. The board of directors
Internal stakeholders include all employees, the board of directors, and stockholders. External
stakeholders are all other individuals and groups that have some claim on the firm. Typically, this
group comprises customers, suppliers, lenders, governments, unions, local communities, and the
general public.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-75
Education.
81. _____ means standing in the shoes of a stakeholder and asking how a proposed decision might
impact that stakeholder.
A. Veil of ignorance
B. Difference principle
C. Moral imagination
D. Noblesse oblige
Stakeholder analysis involves a certain amount of what has been called moral imagination. This
means standing in the shoes of a stakeholder and asking how a proposed decision might impact
that stakeholder.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-76
Education.
82. Establishing _____ involves a business to resolve to place moral concerns ahead of other concerns in
cases where either the fundamental rights of stakeholders or key moral principles have been
violated.
A. a veil of ignorance
B. a difference principle
C. moral imagination
D. moral intent
Moral intent implies that a business must resolve to place moral concerns ahead of other concerns
in cases where either the fundamental rights of stakeholders or key moral principles have been
violated.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
83. Which of the following enables managers to walk away from a decision that is profitable, but
unethical?
A. Noblesse oblige
B. Moral courage
C. The difference principle
D. The Friedman doctrine
It is important to recognize that employees in an international business may need significant moral
courage. Moral courage enables managers to walk away from a decision that is profitable but
unethical.
AACSB: Ethics
Blooms: Remember
5-77
Education.
Difficulty: 1 Easy
Gradable: automatic
84. What is the term for a company's formal statement of the ethical priorities it expects all of its
employees to follow?
A. Code of ethics
B. Stakeholders pledge
C. Moral courage
D. Difference principle
Many companies explicitly articulate values that emphasize ethical behavior by drafting a code of
ethics, which is a formal statement of the ethical priorities a business adheres to.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
85. Business ethics that either deny the value of business ethics or apply the concept in a very
unsatisfactory way are termed _____.
A. straw men
B. the Sullivan principles
C. just distribution
D. rights theories
Straw men approaches to business ethics are raised by business ethics scholars primarily to
demonstrate that they offer inappropriate guidelines for ethical decision making in a multinational
enterprise.
AACSB: Ethics
5-78
Education.
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
86. Which of the following ethical theories explicitly rejects the idea that businesses should undertake
social expenditures beyond those mandated by the law and required for the efficient running of a
business?
A. The naive immoralist

C. Cultural relativism
D. The righteous moralist
AACSB: Ethics
Blooms: Apply
Gradable: automatic
5-79
Education.
87. A(n) _____ asserts that if a manager of a multinational sees that firms from other nations are not
following ethical norms in a host nation, that manager should not either.
A. Kantian ethicist
C. naive immoralist
D. utilitarian ethicist
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
88. Any person or institution that is capable of moral action such as a government or corporation is
a(n) _____.
A. moral agent
B. utilitarian
D. naive immoralist
A moral agent is any person or institution that is capable of moral action such as a government or
corporation.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
5-80
Education.
89. Under the veil of ignorance, everyone is imagined to be ignorant of:
A. all of his/her particular characteristics.

B. fundamental rights and privileges.
C. the moral worth of actions or practices.
D. the minimum levels of morally acceptable behavior.
Under the veil of ignorance, everyone is imagined to be ignorant of all of his or her particular
characteristics, for example, race, sex, intelligence, nationality, family background, and special
talents.
AACSB: Ethics
Blooms: Understand
Difficulty: 1 Easy
Gradable: automatic
90. _____ are the accepted principles of right or wrong governing the conduct of businesspeople.
A. Sustainable strategies
B. Business ethics
C. Moral worth of actions
D. Ethical strategies
Business ethics are the accepted principles of right or wrong governing the conduct of
businesspeople.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-81
Education.
91. The veil of ignorance was developed by _____ as part of his approach to justice theories.
A. Milton Friedman
B. John Rawls
C. Kantian
D. Leon Sullivan
The veil of ignorance was developed by John Rawls as part of his approach to justice theories.
According to Rawls, valid principles of justice are those with which all persons would agree if they
could freely and impartially consider the situation. Impartiality is guaranteed by the veil of
ignorance. Under the veil of ignorance, everyone is imagined to be ignorant of all of his/her
particular characteristics. Under these conditions everyone would agree that (1) each person be
permitted the maximum amount of basic liberty compatible with a similar liberty for others, and (2)
once basic liberty is assured, inequality in basic social goods is to be allowed only if such
inequalities benefit everyone.
AACSB: Ethics
Blooms: Remember
Difficulty: 1 Easy
Gradable: automatic
5-82
Education.
92. Often, the code of ethics draws heavily upon documents such as the _____, which itself is grounded
in Kantian and rights-based theories of moral philosophy.

D. UN Universal Declaration of Human Rights
A code of ethics is a formal statement of the ethical priorities a business adheres to. Often, the
code of ethics draws heavily upon documents such as the UN Universal Declaration of Human
Rights, which itself is grounded in Kantian and rights-based theories of moral philosophy.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
93. Which of the following is a reason why managers behave in a manner that is unethical?
A. Psychological and geographical distances of a foreign subsidiary from the home office
B. Pressure from an ethical leader
C. Confusion between personal ethics and business ethics
D. Incorporating ethical issues into strategic and operational decision making
The causes that contribute to unethical behavior in businesses are very complex. However, a few
generalizations can be made. Unethical behavior is rooted in poor personal ethics, societal culture,
the psychological and geographical distances of a foreign subsidiary from the home office, a failure
to incorporate ethical issues into strategic and operational decision making, a dysfunctional culture,
and failure of leaders to act in an ethical manner.
AACSB: Ethics
Blooms: Apply
5-83
Education.
Gradable: automatic
94. In the international business setting, one of the most common ethical issues involves _____.
A. hiring practices
B. government deregulation
C. the moral obligation of multinational corporations
D. facilitating payments
Many of the ethical issues and dilemmas in international business are rooted in the fact that
political systems, law, economic development, and culture vary significantly from nation to nation.
Therefore, what might be considered a normal business practice in one country may constitute
unethical behavior in another country. Managers in a multinational company need to be sensitive
to these differences and choose the ethical action in those circumstances where variation across
societies creates the potential for ethical problems. In the international business setting, the most
common ethical issues involve employment practices, human rights, environmental regulations,
corruption, and the moral obligation of multinational corporations.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
5-84
Education.
95. The _____ obliges member states to make the bribery of foreign public officials a criminal offense
and excludes facilitating payments made to expedite routine government action from the
convention.

In 1997, the OECD adopted the Convention on Combating Bribery of Foreign Public Officials in
International Business Transactions. The convention obliges member states to make the bribery of
foreign public officials a criminal offense. The convention excludes facilitating payments made to
expedite routine government action from the convention.
AACSB: Ethics
Blooms: Apply
Gradable: automatic
Essay Questions
5-85
Education.
96. Discuss how companies such as Exxon, Kodak, and IBM helped improve human rights in South
Africa.
During the 1980s, many American companies doing business in South Africa realized that following
the Sullivan principles of not obeying apartheid laws and trying to promote their abolition was not
a sufficiently ethical strategy. Consequently, many companies divested their holdings in the nation.
At the same time, the U.S. government and other nations imposed economic sanctions on the
country. Together, these actions helped bring about democratic elections in the nation in 1994, and
an end to white minority rule.
AACSB: Ethics
Blooms: Analyze
Difficulty: 3 Hard
Gradable: manual
97. Should a multinational feel free to pollute in a developing nation?
This question is designed to stimulate classroom discussion or the personal opinion of the student.
Issues that might emerge include whether there is any danger that a moral management might
move production to a developing nation precisely because costly pollution controls are not
required, the notion that the environment is public good that no one owns, but that anyone can
despoil, human-induced global warming, and legality of various actions.
AACSB: Ethics
Blooms: Evaluate
Difficulty: 3 Hard
Gradable: manual
5-86
Education.
98. In your opinion, are bribes ever acceptable? Why or why not?
This question is designed to allow the students to explore the idea of bribery as possibly resulting in
a positive rather than a negative outcome. Some economists have suggested that corruption might
in fact improve efficiency and help growth. Others however, argue that corruption simply reduces
the returns on business investment and leads to low economic growth.
AACSB: Ethics
Blooms: Evaluate
Difficulty: 3 Hard
Gradable: manual
99. Discuss the notion of social responsibility. What does it mean for corporations?
be a presumption in favor of decisions that have both good economic and social consequences. In
a business setting, social responsibility means that benevolent behavior is the responsibility of
successful enterprises.
AACSB: Ethics
Blooms: Analyze
Difficulty: 3 Hard
Gradable: manual
5-87
Education.
100. What are ethical dilemmas? Why do they exist?
acceptable. Ethical dilemmas exist because many real-world decisions are complex, difficult to
frame, and involve first-, second-, and third-order consequences that are hard to quantify. To deal
with these situations, managers need a moral compass to guide them through the dilemma to find
an acceptable solution.
AACSB: Ethics
Blooms: Evaluate
Difficulty: 3 Hard
Gradable: manual
101. Why are expatriate managers at a greater risk of violating their personal code of ethics?
Expatriate managers may experience more than the usual degree of pressure to violate their
personal ethics. They are away from their ordinary social context and supporting culture, and they
are psychologically and geographically distant from the parent company. They may be based in a
culture that does not place the same value on ethical norms important in the manager's home
country, and they may be surrounded by local employees who have less rigorous ethical standards.
The parent company may pressure expatriate managers to meet unrealistic goals that can only be
fulfilled by acting unethically. For example, to meet centrally mandated performance goals,
expatriate managers might give bribes to win contracts. Local managers might encourage the
expatriate to adopt such behavior. Due to its geographical distance, the parent company may be
unable to see how expatriate managers are meeting goals, or may choose not to see how they are
doing so, allowing such behavior to flourish and persist.
AACSB: Ethics
Blooms: Evaluate
Difficulty: 3 Hard
Gradable: manual
5-88
Education.
102. Explain the Friedman doctrine. Who developed the philosophy? How well does this approach hold
up ethically?
In 1970, Milton Friedman suggested that the only social responsibility of business is to increase
profits, so long as the company stays within the rules of law. He explicitly rejects the idea that
business should undertake social expenditures beyond those mandated by the law and required for
the efficient running of a business. Friedman does state that businesses should behave in an ethical
manner and not engage in deception and fraud, however, most economists believe that his
approach to ethics does not hold up well. For example, even though child labor may not be against
the law in a particular country, it is still unethical to use child labor.
AACSB: Ethics
Blooms: Analyze
Gradable: manual
103. Discuss the cultural relativism approach to business ethics. What is the connection between this
approach and the phrase "When in Rome do as the Romans"? How well does this approach hold
up ethically?
The cultural relativism approach is the belief that ethics are nothing more than the reflection of a
culture and accordingly, a firm should adopt the ethics of the culture in which it is operating. This
approach is often summarized by the maxim "When in Rome do as the Romans." Cultural relativism
does not stand up well to business ethics because it suggests that if a culture allows slavery, then it
is acceptable for a firm to use slaves as well. Cultural relativism implicitly rejects the idea that
universal notions of morality transcend different cultures, however, some universal notions of
morality are found across cultures.
AACSB: Ethics
Blooms: Evaluate
Difficulty: 3 Hard
Gradable: manual
5-89
Education.
104. Discuss the naive immoralist's approach to business ethics. What are the criticisms of this
approach?
The naive immoralist asserts that if a manager of a multinational sees that firms from other nations
are not following ethical norms in a host nation, that manager should not either. This approach has
been criticized with the argument that simply accepting an action as being ethically justified just
because everyone is doing it is not sufficient. Moreover, the multinational company does have the
ability to change the prevailing practice in the country.
AACSB: Ethics
Blooms: Analyze
Difficulty: 3 Hard
Gradable: manual
105. Discuss the utilitarian approach to business ethics. When was this approach developed? What are
its drawbacks?
The utilitarian approach to business ethics was developed in the 18 th and 19th centuries by
philosophers such as David Hume, Jeremy Bentham, and John Stuart Mill. The utilitarian approach
to ethics holds that the moral worth of actions or practices is determined by their consequences. An
action is judged to be desirable if it leads to the best possible balance of good consequences over
bad consequences. The best decisions are those that produce the greatest good for the greatest
number of people.
This approach has certain limitations. One serious drawback of the utilitarian approach is that it is
difficult to measure the benefits, costs, and risks of a course of action. A second problem is that the
philosophy omits the consideration of justice.
AACSB: Ethics
Blooms: Analyze
5-90
Education.
Difficulty: 3 Hard
Gradable: manual
106. What are the ways in which international business and its managers can ensure that ethical issues
are considered in business decisions?
An international business and its managers can take several steps to make sure ethical issues are
considered in business decisions. Some of these are: (1) favor hiring and promoting people with a
well-grounded sense of personal ethics; (2) build an organizational culture that places a high value
on ethical behavior; (3) make sure that leaders within the business not only articulate the rhetoric of
ethical behavior, but also act in a manner that is consistent with that rhetoric; (4) put decision-
making processes in place that require people to consider the ethical dimension of business
decisions; and (5) develop moral courage.
AACSB: Ethics
Blooms: Apply
Gradable: manual
5-91
Education.
107. Describe the five-step process that businesses can use to think through ethical problems.
Some experts on ethics have recommended a five-step process to think through ethical problems.
In step 1, businesspeople should identify which stakeholders a decision would affect and in what
ways. Stakeholder analysis involves a certain amount of moral imagination. Step 2 involves judging
the ethics of the proposed strategic decision, given the information gained in step 1. Managers
need to determine whether a proposed decision would violate the fundamental rights of any
stakeholders. Step 3 requires managers to establish moral intent. This means the business must
resolve to place moral concerns ahead of other concerns in cases where either the fundamental
rights of stakeholders or key moral principles have been violated. Step 4 requires the company to
engage in ethical behavior. Step 5 requires the business to audit its decisions, reviewing them to
make sure they were consistent with ethical principles, such as those stated in the company's code
of ethics.
AACSB: Ethics
Blooms: Apply
Gradable: manual
108. Why do organizations appoint an ethics officer?
To make sure that a business behaves in an ethical manner, a number of firms now have ethics
officers. These individuals are responsible for making sure that all employees are trained to be
ethically aware, that ethical considerations enter the business decision-making process, and that the
company's code of ethics is followed. Ethics officers may also be responsible for auditing decisions
to make sure they are consistent with this code. In many businesses, ethics officers act as an
internal ombudsperson with responsibility for handling confidential inquiries from employees,
investigating complaints from employees or others, reporting findings, and making
recommendations for change.
AACSB: Ethics
Blooms: Evaluate
5-92
Education.
Gradable: manual
109. How can companies strengthen the moral courage of employees?
Companies can strengthen the moral courage of employees by committing themselves to not
retaliate against employees who exercise moral courage, say no to superiors, or otherwise complain
about unethical actions. Companies can also set up ethics hotlines, which allow employees to
anonymously register a complaint with a corporate ethics officer.
AACSB: Ethics
Blooms: Apply
Gradable: manual
110. Explain the concept of moral imagination as it relates to a company's stakeholders.
All stakeholders are in an exchange relationship with the company. Each stakeholder group
supplies the organization with important resources (or contributions), and in exchange each
expects its interests to be satisfied by inducements. Stakeholder analysis involves a certain amount
of what has been called moral imagination. This means standing in the shoes of a stakeholder and
asking how a proposed decision might impact that stakeholder.
AACSB: Ethics
Blooms: Apply
Gradable: manual
5-93
Education.

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Chapter 05

Ethics, Corporate Social Responsibility, and Sustainability

True / False Questions

5. International businesses cannot gain economic advantages by making payments to corrupt

11. Societal business ethics are divorced from personal ethics.

20. Utilitarian philosophy takes into consideration the principle of justice.

Multiple Choice Questions

A. tragedy of the commons

A. Convention on Combating Bribery of Foreign Public Officials

28. Facilitating payments are also known as _____.

30. Ethical dilemmas exist because many real-world decisions involve:

A. first-, second-, and third-order consequences that are hard to quantify.

A. human resource personnel

40. A firm's _____ include customers, suppliers, and lenders.

A. external stakeholders of an organization.

45. Identify the INCORRECT statement about environmental regulations.

A. Environmental regulations are often lacking in developing nations.

A. noblesse oblige situation.

49. Facilitating payments are:

A. a direct violation of the Foreign Corrupt Practices Act.

A. bribes made to secure contracts that would otherwise not be secured.

A. the naive immoralist

58. According to the Friedman doctrine:

A. ethics are nothing more than the reflection of culture.

59. Cultural relativism suggests that:

A. a firm should adopt the ethics of the culture in which it is operating.

A. The Friedman doctrine

A. the Friedman doctrine

A. ethics are nothing more than the reflection of culture.

64. According to the naive immoralist,

A. The righteous moralist

70. Identify the correct statement about the rights theories.

A. John Stuart Mill

A. The requirement for the formation of trade unions.

A. It transcends national borders.

75. Justice theories of business ethics focus on:

A. the moral worth of actions or practices.

76. According to John Rawls:

78. According to John Rawls's difference principle,

79. External stakeholders:

A. are individuals or groups who own the business.

80. Which of the following is an example of an external stakeholder?

A. The naive immoralist

A. all of his/her particular characteristics.

A. Convention on Combating Bribery of Foreign Public Officials

A. Convention on Combating Bribery of Foreign Public Officials

97. Should a multinational feel free to pollute in a developing nation?

100. What are ethical dilemmas? Why do they exist?

109. How can companies strengthen the moral courage of employees?

110. Explain the concept of moral imagination as it relates to a company's stakeholders.

True / False Questions

The ethical obligations of a multinational corporation toward employment conditions, human

20. Utilitarian philosophy takes into consideration the principle of justice.

Multiple Choice Questions

A. tragedy of the commons

A. Convention on Combating Bribery of Foreign Public Officials

A. first-, second-, and third-order consequences that are hard to quantify.

31. Employees in a business often take their cue from _____.

A. human resource personnel

40. A firm's _____ include customers, suppliers, and lenders.

A. external stakeholders of an organization.

A. Environmental regulations are often lacking in developing nations.

A. noblesse oblige situation.