Chapter 5 Flashcards
(47 cards)
Ethics
- A system of right and wrong.
- Sources : religious beliefs, national and ethnic beliefs, community standards, family practices, educational experiences, and friends.
Ethical Issues
- Conflict between personal values and organizational objectives.
- Organizational goals.
- Conflict between organizational objectives and social values.
- Exploiting certain groups.
Code of Ethics
A document that outlines the principles of conduct to be used in making decisions within an organization.
The Sherman Act
Makes it illegal for companies to monopolize trade. Prevents a certain company from controlling too large a share in the market.
The Clayton Act
Makes it illegal to charge different prices to different wholesale customers and bans the practice of requiring a consumer to purchase a second good.
The Wheeler-Lea Act
Bans unfair or deceptive acts or practices, including false advertising.
- Must inform of possible negative consequences of their products.
Sarbanes-Oxley Act
- Auditor Independence
- Restriction on firms engaging accounting firms for both auditing and consulting.
- Independence of firm’s board committees
- Assessment of internal controls by mgmt.
- Personal Certification of financial reports by CEOs and CFOs.
Competitive Behavior
- The Sherman Act
- The Clayton Act
- The Wheeler-Lea Act
- Sarbanes-Oxley Act
Federal Food, Drug, and Cosmetic Act
Bans the sale of impure, improperly labeled, falsely guaranteed, and unhealthful foods, drugs, and cosmetics.
Consumer Product Safety Commission (CPSC)
- Can force recall on products
- Establishes minimum safety product standards.
Truth in Lending Act
Creditors are required to let consumers know how much they are paying in finance chargers and interest.
Equal Credit Opportunity Act
Prohibits creditors from making credit decisions on the basis of discriminatory practices.
Consumer Protection
- FDA
- CPSC
- Truth in Lending Act
- Equal Credit Opportunity Act
The National Environmental Policy Act
Protect human health and safeguard the air, water, and land.
The Clean Air Act
Regulates air emissions.
The Toxic Substances Control Act
Gives EPA the ability to track the 75,000 industrial chemicals currently produced or imported in the U.S.
Clean Water Act
Set standards on the type and quantity of pollutants that industries can put into bodies of water.
Environmental Protection
- Clean Air Act
- Toxic Substances Control Act
- Clean Water Act
- National Environmental Policy Act
Corporate Gift Giving
- Must be aware of the culture.
- In U.S. government officials aren’t allowed to accept expensive gifts from businesses.
Intellectual Property
The ownership of ideas, such as inventions, books, movies, and computer programs.
- Gives exclusive right to market and sell their work (the creators).
Social Responsibility
The obligation that individuals or businesses have to help solve social problems.
Trusteeship Management
Recognized that business owners had obligations to do more than just earn profits. They had obligations to employees, customers, and creditors.
Stakeholders
The company’s employees, customers, suppliers, and the economy.
Sustainability
The expansion of an organization’s traditional concerns to take into account social endeavors and environmental stewardship as well as financial performance.
