EXAM 1 Prep: Business Ethics and Corporate Culture Study Guide

Vocabulary flashcards covering key terms and concepts from Chapters 1 to 4 on Business Ethics, Ethical Decision Making, Philosophical Frameworks, and Corporate Culture.

Ethics

The study of how human beings should act and live their lives, examining the responsibilities owed to oneself and others in personal and business contexts.

Practical Reasoning

Reasoning directed toward determining what an individual ought to do and how one should act and behave.

Theoretical Reasoning

Reasoning aimed at establishing truth and determining what an individual should reasonably believe.

Normative Ethics

A discipline that evaluates and establishes standards for how and why people should act, as opposed to how they actually act.

Descriptive Ethics

An empirical approach from social sciences that describes and accounts for how and why people actually act without establishing normative guidelines.

Norms

Standards of appropriate and proper behavior that establish guidelines for what we should do, how we should act, and what type of person we should be.

Values

Underlying beliefs that incline an individual or institution to act or choose one course of action rather than another.

Ethical Values

Beliefs and principles that serve human well-being in an impartial rather than personal or selfish manner.

Morality

The underlying value structures and moral systems defining personal integrity and guiding individual choices.

Social Justice

An area of ethics dealing with how communities, social organizations, and institutions should be structured.

Stakeholder

Any individual or group that affects or is affected by decisions made within a firm, for better or worse.

Separation Thesis

The view that ordinary ethical standards should be kept separate from business decisions because business operates under its own standards.

Psychological Egoism

The theory asserting that all human actions are inherently selfish and motivated exclusively by self-interest.

Risk Assessment

A process to identify and manage potential events affecting an entity, incorporating ethics when evaluating potential harms and benefits to stakeholders.

B Corp Certification

An independent third-party verification audited according to ISO 17021-1 requirements, confirming a business meets social, environmental, and governance standards.

Normative Myopia

Shortsightedness regarding values, resulting in an inability to recognize ethical issues or decision points in a situation.

Inattentional Blindness

The failure to notice key ethical information or details due to focusing on too narrow a range of questions or issues.

Moral Imagination

The ability to envision various alternative choices, consequences, resolutions, benefits, and harms outside traditional boundaries.

Satisficing

Selecting an alternative that meets minimal decision criteria rather than making the optimal or best choice.

Social Roles

Positions and relationships held within society, such as friend, spouse, parent, child, or neighbor.

Institutional Roles

Formal positions held within organizations, such as employee, manager, professor, or club president.

Utilitarianism

A consequentialist ethical theory directing decision makers to maximize overall human well-being, commonly summarized as producing the greatest good for the greatest number.

Consequentialism

An approach to ethics holding that the rightness or wrongness of an action is determined strictly by its outcomes or consequences.

Egoism

A consequentialist theory that evaluates decisions based exclusively on maximizing the happiness and self-interest of the individual decision maker.

Deontology

A principle-based or duty-based ethical framework emphasizing that actions should be guided by moral duties, principles, and obligations regardless of consequences.

Categorical Imperative

An unconditional, overriding ethical command associated with Immanuel Kant that must be obeyed regardless of circumstance, containing no 'if' clause.

Hypothetical Duties

Conditional duties or professional rules that bind an individual only if they occupy a specific role or profession.

Autonomy

The fundamental human right to self-rule and self-determination, requiring that persons are treated as ends in themselves and never merely as tools.

Libertarian View of Justice

A social justice theory holding individual liberty as central, asserting that a just society limits governmental intrusion as long as individuals do not harm others.

Egalitarian View of Justice

A social justice theory holding equality as central, advocating for equal distribution of basic goods or equal opportunity through governmental responsibility.

Virtue Ethics

An ethical framework focusing on moral character traits (virtues) and who a person is, examining how habits are formed to lead a meaningful human life.

Corporate Culture

A shared pattern of beliefs, expectations, meanings, and values that guides the thinking and behavior of members within an organization.

Compliance-Based Culture

A corporate culture that emphasizes strict adherence to rules, laws, and regulations as the primary responsibility of ethics; Transactional based

Values-Based Culture

A corporate culture where conformity to a statement of shared values and principles, relying on personal integrity, is the primary model for ethical behavior; Transformable based

Transformational Leadership

A leadership style where leaders employ methods that empower subordinates to take initiative, solve problems, and drive organizational change.

Transactional Leadership

A leadership style focused on management exchanges and standard operational goals, balancing profits and people.

Mission Statement

A formal articulation of an organization's fundamental, overall purpose and core tenets in the present.

Vision Statement

A forward-looking statement defining what an organization aspires to achieve or become in the future.

Code of Conduct

A formal set of guidelines and principles designed to enhance organizational reputation, guide internal decision-making, and manage risk.

Whistleblowing

The practice in which an individual within an organization reports organizational wrongdoing to internal authorities or external entities.

United States Sentencing Commission (USSC)

An independent agency in the U.S. judiciary that regulates federal sentencing policy and corporate penalties.

Federal Sentencing Guidelines for Organizations (FSGO)

Federal rules prescribed by the USSC using 43 offense levels to categorize organizational misconduct and incentivize effective ethics and compliance programs.