Business Ethics and Governance

41. To be successful, business ethics training programs need to:

1. focus on personal opinions of employees.
2. be limited to upper executives.
3. educate employees on formal ethical frameworks and models of ethical decision making.
4. promote the use of emotions in making tough ethical decisions.

42. Under the _____________, both internal and external corporate governance mechanisms are intended to induce managerial actions that maximize profit and shareholder value.

1. Shareholder theory.
2. Agency theory.
3. Stakeholder theory.
4. Corporate governance theory.

43. Which of the following regarding agency theory is correct?

1. Agency theory only applies to large entities.
2. Agents act in the best interest of the principal.
3. Agents are assumed to be in a position of power.
4. Agency theory defines the relationship between agents and directors.

44. What type of justice exists if employees are being open, honest, and truthful in their communications at work?

1. Procedural
2. Distributive
3. Ethical
4. Interactional

45. When a firm charges different prices to different groups of customers, it may be accused of:

1. cultural relativism
2. money laundering
3. facilitating payments
4. price discrimination

46. Where in the annual report would you expect to find mandatory social and environmental reporting?

1. The financial statements and the chairman's report.
2. Notes to the financial statements and directors' report.
3. Corporate governance information and the auditor's report.
4. The Directors' declaration and the Chief Executive Officer's report.

47. Which moral philosophy seeks the greatest good for the greatest number of people?

1. Consequentialism
2. Utilitarianism
3. Egoism
4. Ethical formalism

48. Which of the following descriptions applicable to different types of directors and their independence is incorrect?

1. Independent executive director.
2. Independent non-executive director.
3. Non-independent executive director.
4. Non-independent non-executive director.

49. Which of the following is a problem presented by ethics audits?

1. They may be used to reallocate resources.
2. They identify practices that need improvement.
3. Selecting auditors may be difficult.
4. They may pinpoint problems with stakeholder relationships.

50. Which of the following is not a CSR theory?

1. Rights theory.
2. Legitimacy theory.
3. Stakeholder theory.
4. Enlightened self-interest.