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64 Cards in this Set
- Front
- Back
Under new post... ENRON legislation.... |
the company CEO may be charged and JAILED... even if he/she had no personal knowledge of infractions... and even if he/she never ordered or "approved" of the wrong doings. |
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Corporate Responsibility |
* Both the corporation and the responsible employee/ officer are legally liable for violations a company commits
* The government now places the responsibility for controlling and preventing misconduct squarely on the shoulders of top management. |
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Lost Leader Pricing |
selling an item to a consumer below the store cost |
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Business Ethics |
an identifiable problem, situation, or opportunity that requires a person to choose from among several actions that may be evaluated as right or wrong, ethical or unethical |
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Social Responsibility |
business obligation to maximize its positive impact and minimize its negative impact on society |
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Laws and Regulations |
* encourage businesses to conform to society's basic standards, values, and attitudes.
* Sarbanes-Oxley Act, 2002 * Troubled Assets Relief Program |
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Role of Ethics |
growing concerns about legal and ethical issues in business * antitrust violations* accounting fraud * cyber crimes * unfair competitive practices * tax fraud |
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Ethical Issue |
* an identifiable problem, situation, or opportunity that requires a person to choose from among several actions that may be evaluated as right or wrong, ethical or unethical
* Helps to build trust, promote confidence, and validate relationships |
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Judge Ethics |
* Examine the situation from the stakeholders' position, including customers and competitors
* People often need years of experience to accurately recognize and react to ethical situations * ethical situations vary by culture *** Highly Ethical Companies are generally more profitable!!!! |
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Conflict of Interest |
* Advance personal interest over other's interest
* Benefit self at the expense of the company * "A decision that you are empowered to make can have the effect of enriching you." |
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Bribes |
Represent a conflict of interest because they benefit an individual at the expense of an organization or company |
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Most Common Misuse of Company Resources |
* time theft
* use of personal email and social networking sites at work is a growing problem * stealing office supplies * unauthorized use of software and programs |
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Fairness and Honesty |
* are the heart of business ethics
* how employees use resources |
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Ethical Concerns |
* false/misleading advertising
* deceptive personal selling tactics * truthfulness in product safety and quality * unsubstantial claims * product labeling |
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Plagarism |
the act of taking someone else's work and presenting it as your own without mentioning the source |
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Code of Ethics |
formalized rules and standards that describe what a company expects of its employees |
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Whistleblowing (tattletale) |
occurs when an employee exposes an employers' wrong doing to outsiders. |
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4 Dimensions to Social Responsibilities |
1. Economic |
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Corporate Citizenship |
the extent to which businesses meet the legal, ethical, economic, and voluntary responsibilities placed on them by their stakeholders |
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Shareholders |
* an individual or institution (including a corporation) that legally owns a share of stock in a public or private corporation
* primarily concerned with profit or ROI (return on investment) * financial community at large |
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Employees wants from employer |
* a safe workplace
* fair treatment * adequate compensation * listen to grievances |
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Consumerism |
* activities that independent individuals, groups, and organizations undertake to protect their rights as consumers
* critical issue is businesses responsibility to customers to provide satisfying, safe products and to respect their rights as consumers |
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Kennedy's Consumer Bill of Rights |
1. the right to safety |
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Sustainability |
conducting activities in a way that allows for the long-term well-being of the natural environment in mind. |
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Business Law |
Rules and Regulations that govern the conduct of business * misunderstandings occur * expectations were not made clear * Individuals & corporations sometimes take advantage of others * And thus, we need an "arena" for a fair fight to resolve disputes |
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Criminal Law |
* certain activites or behaviors are prohibited by statute
* the "state" is the aggrieved party, and the wrongdoer is prosecuted * remedy? jail and/or fines |
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Civil Law |
(no prosecution/no one is arrested) * establishes that persons have right. the violation of which is a "civil" wrong* the wronged party must "SUE" in his own name and at his own expense * Remedy? Damage$$ |
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Going to Trial |
A court trial MAY be avoided by * mediation (not binding)* arbitration (binding) * mini trial * private court system ---Case begins in a court house having jurisdiction |
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Administrative & Regulatory Agencies |
* have the authority to issue rules and regulations and to enforce them.
* Examples: FTC, CPSC, EEOC, OSHA, and EPA * These may conduct investigations and give fines/penalites on their own authority. |
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N.A.L. |
Notice of Apparent Liability |
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F.T.C. |
Federal Trade Commission * enforces laws and guidelines regarding business practices, take action to stop false and deceptive advertising and labeling. |
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C.P.S.C. |
Consumer Product Safety Commission * Ensures compliance with the Consumer Product Safety Act; protects the public from unreasonable risk of injury from any consumer product not covered by other regulatory agencies. |
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E.E.O.C. |
Equal Employment Opportunity Commission * Investigates and resolves discrimination in employment practices. |
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O.S.H.A. |
Occupational Safety and Health Administration * Develops policy to promote worker safety and health and investigates infractions. |
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E.P.A. |
Environmental Protection Agency * Develops and enforces environmental protection standards and conducts research into the adverse effects of pollution. |
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F.D.A. |
Food and Drug Administration * Enforces laws and regulations to prevent distribution of adulterated or misbranded foods, drugs, medical devices, cosmetics, veterinary products, and particularly hazardous consumer products. |
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I.C.C. |
Interstate Commerce Commission * Regulates franchises, rates, and finances of interstate rail, bus, truck, and water carriers. |
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F.C.C. |
Federal Communications Commission * Regulates communication by wire, radio, and television in interstate and foreign commerce. |
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F.E.R.C. |
Federal Energy Regulatory Commission * Regulates rates and sales of natural gas products, thereby affecting the supply and price of gas available to consumers; also regulates wholesale rates for electricity and gas, pipeline construction, and U.S. importsand exports of natural gas and electricity. |
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F.A.A. |
Federal Aviation Administration * Oversees the policies and regulations of the airline industry. |
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F.H.A. |
Federal Highway Administration * Regulates vehicle safety requirements. |
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S.E.C. |
Securities and Exchange Commission * Regulates corporate securities trading and develops protection from fraud and other abuses; provides an accounting oversight board. |
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The Uniform Commercial Code |
* Meant to provide uniformity in laws governing business, the UCC has been enacted by the Federal Government and by 49 of 50 states. (Louisiana is the exception)
* Primarily deals with contracts and sales |
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Torts |
* a civil wrong, where one party has caused "injury" to another
* "injury" is more than physical--ECONOMIC * The injured party may sue the one who "injured" him. |
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Fraud |
an act of deception that, again, injuries another party |
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Negligence |
* includes Product Liability
* A Failure to exercise a required level of care. |
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Contract |
Mutual agreement between two or more parties that can be enforced in a court if one party chooses not to comply with the terms of the contract. |
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Breach of Contract |
failure to abide by, or carry out your agreement- has penalties that the court will enforce * specific performance
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Agent |
one who acts on behalf of, and in the interests of another party, his principal |
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Power of Attorney |
standard "agency creating" documentation |
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The Law of Property |
property rights mean "ownership" * the right to use, possess, and enjoy... and to prevent others from using, possessing, and enjoying* anyone that uses your property without your permission has committed a tort and the property owner can sue for damage$ |
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Three types of Property |
1.) real property |
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Bankruptcy |
begins when a company (or person!) become insolvent * As a consequence, all debts are discharged |
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Three types of Bankruptcy |
1.) chapter 7 |
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Chapter 7 Bankruptcy |
"straight bankruptcy" |
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Chapter 11 bankruptcy |
"corporate reorganization" |
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Chapter 13 Bankruptcy |
only available to individuals; "wage earner plan" (5 years to pay off) |
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Laws Directly Affecting Business |
1.) Sherman Antitrust Law |
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Sherman Antitrust Act 1890 |
The first measure passed by the U.S. Congress to prohibit trusts. |
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The Clayton Act |
Designed to prevent companies from creating monopolies through mergers and acquisition |
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Federal Trade Commission Act |
* created regulatory agency helping businesses determine whether actions acceptable
* launch prosecutions against unfair trade practices |
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Wheeler Lee Amendment |
expanded powers of FTC to include unfair or deceptive acts/practices |
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Lanham Act |
Provides protections for and regulations of brand names, brand markes, trade names and trademarks |
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S.R.P. |
Suggested Retail Price |