Explanation: E) Individuals and groups that are directly affected by the practices of an organization are considered to have a "stake" in the company's performance. Page Ref: 39 Difficulty: Moderate AACSB: Ethical understanding and reasoning abilities Objective: 2.2 Learning Outcome: Discuss the factors that influence decisions about organizational structure Skill: Application 46) The CEO of Perry's Pizzeria, a rapidly growing restaurant chain, is committed to a high level of corporate social responsibility along with continued business success. Which action by the CEO would most enhance the company's reputation for social responsibility? A) using more nutritious, but more expensive, ingredients B) cutting employees' wages and benefits to boost the company's stock price C) using marketing or advertising methods that would allow the company to discreetly reduce pizza size without also reducing the price D) packaging products in material that costs less, even if customers object to the change E) taking steps that would cause competitors to close their doors Answer: A Explanation: A) Although Pizzeria has a responsibility to make the best business decisions for its stakeholders (i.e., bring in a high profit for investors), being socially responsible requires making the best decision for the community as well. Purchasing nutritious ingredients that are expensive would benefit the company's reputation for social responsibility. Its effect on investor profits would also be an issue of contention for the company's CEO. Page Ref: 40 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 2.2 Learning Outcome: Discuss the roles of ethics and corporate responsibility in business Skill: Application 47) Dara's Dress Shop was honored last year for its strong commitment to corporate social responsibility. Which of the following would MOST likely decrease the shop's chances of being recognized again this year? A) The shop has laid off two employees during the past six months. B) Fewer clearance sales have been offered to the public this year. C) An experienced ethics professional has been added to the Board of Directors. D) Many of the dresses are made from fabrics spun by unprotected child laborers. E) The shop has reduced its line of designer merchandise. Answer: D Explanation: D) A socially responsible company decisions in the area of human rights and employment standards in the workplace. Using unprotected child laborers for production goes against this tenet. Page Ref: 41
Explanation: E) Individuals and groups that are directly affected by the practices of an organization are considered to have a "stake" in the company's performance. Page Ref: 39 Difficulty: Moderate AACSB: Ethical understanding and reasoning abilities Objective: 2.2 Learning Outcome: Discuss the factors that influence decisions about organizational structure Skill: Application 46) The CEO of Perry's Pizzeria, a rapidly growing restaurant chain, is committed to a high level of corporate social responsibility along with continued business success. Which action by the CEO would most enhance the company's reputation for social responsibility? A) using more nutritious, but more expensive, ingredients B) cutting employees' wages and benefits to boost the company's stock price C) using marketing or advertising methods that would allow the company to discreetly reduce pizza size without also reducing the price D) packaging products in material that costs less, even if customers object to the change E) taking steps that would cause competitors to close their doors Answer: A Explanation: A) Although Pizzeria has a responsibility to make the best business decisions for its stakeholders (i.e., bring in a high profit for investors), being socially responsible requires making the best decision for the community as well. Purchasing nutritious ingredients that are expensive would benefit the company's reputation for social responsibility. Its effect on investor profits would also be an issue of contention for the company's CEO. Page Ref: 40 Difficulty: Moderate AACSB: Reflective thinking skills Objective: 2.2 Learning Outcome: Discuss the roles of ethics and corporate responsibility in business Skill: Application 47) Dara's Dress Shop was honored last year for its strong commitment to corporate social responsibility. Which of the following would MOST likely decrease the shop's chances of being recognized again this year? A) The shop has laid off two employees during the past six months. B) Fewer clearance sales have been offered to the public this year. C) An experienced ethics professional has been added to the Board of Directors. D) Many of the dresses are made from fabrics spun by unprotected child laborers. E) The shop has reduced its line of designer merchandise. Answer: D Explanation: D) A socially responsible company decisions in the area of human rights and employment standards in the workplace. Using unprotected child laborers for production goes against this tenet. Page Ref: 41