Board of Directors and Ethical Leadership: A Comprehensive Guide for Business Ethics

Question 1

Which of these is NOT a core responsibility of a board of directors in promoting ethical leadership?

Accepted Answer

Approving mergers and acquisitions

Answer

Setting the ethical tone and values of the company

Answer

Monitoring management's adherence to ethical standards

Answer

Providing guidance and support to management on ethical matters

Question 2

Which of the following is NOT a primary responsibility of the board of directors in promoting ethical leadership?

Accepted Answer

Hiring and firing the CEO

Answer

Overseeing the company's ethical conduct and decision-making processes

Answer

Approving the company's strategic plan and major financial transactions

Question 3

What is the purpose of a corporate code of ethics?

Accepted Answer

To provide guidance on ethical behavior.

Answer

To prevent all unethical actions by employees.

Answer

To relieve the board of directors of ethical responsibilities.

Answer

To ensure compliance with all applicable laws.

Question 4

What is the board of directors' primary responsibility in promoting ethical leadership?

Accepted Answer

Encouraging ethical conduct and ensuring corporate accountability

Answer

Managing daily operations

Answer

Maximizing short-term shareholder profits

Question 5

Which approach is typically most effective for resolving ethical conflicts within a board of directors?

Accepted Answer

Finding a compromise that addresses the concerns of all parties

Answer

Imposing a solution based on majority vote

Answer

Seeking guidance from an external expert

Answer

Relying on the judgment of the CEO

Question 6

What is the primary responsibility of the board of directors regarding ethical leadership?

Accepted Answer

Setting ethical values and standards

Answer

Managing daily operations

Answer

Hiring and dismissing the CEO

Question 7

Which ethical decision-making framework emphasizes considering the long-term impact of decisions on all stakeholders?

Accepted Answer

Stakeholder theory

Answer

Utilitarianism

Answer

Kantianism

Answer

Virtue ethics

Question 8

Which of the following stakeholder engagement strategies is most likely to build trust and relationships?

Accepted Answer

Dialogue and collaboration

Answer

Informational meetings

Answer

One-way communication

Answer

Formal surveys

Question 9

Ethical leadership beyond compliance is characterized by:

Accepted Answer

Active promotion of ethical values

Answer

Emphasis on legal requirements only

Answer

Reactive response to ethical issues

Answer

Delegation of ethical responsibilities

Question 10

Which ethical theory advocates maximizing happiness for the greatest number of people?

Accepted Answer

Utilitarianism

Answer

Kantianism

Answer

Virtue ethics

Answer

Deontology

Question 11

In the context of ethical decision-making, the 'stakeholder approach' emphasizes the importance of considering the interests of:

Accepted Answer

All parties potentially affected by the decision

Answer

Only shareholders

Answer

Solely employees

Answer

Regulatory compliance requirements

Question 12

Which of the following is NOT a characteristic of effective ethical leadership?

Accepted Answer

Tolerating minor ethical violations

Answer

Establishing a clear ethical tone

Answer

Communicating ethical expectations explicitly

Answer

Enforcing ethical policies consistently

Question 13

The concept of 'tone at the top' in corporate governance refers to:

Accepted Answer

The ethical values and standards set by the board and senior management

Answer

The ethical climate created by employees at all levels

Answer

The external perception of the company's ethical behavior

Answer

The legal compliance requirements imposed on the company

Question 14

The Sarbanes-Oxley Act of 2002 was enacted in the United States to address concerns about:

Accepted Answer

Financial reporting fraud and corporate governance failures

Answer

Environmental pollution and climate change

Answer

Workplace discrimination and harassment

Answer

Product safety and consumer protection

Question 15

When evaluating the ethical performance of a company, which of the following is NOT a relevant factor to consider?

Accepted Answer

Financial performance

Answer

Compliance with ethical policies and regulations

Answer

Treatment of employees and stakeholders

Answer

Environmental impact

Question 16

The concept of 'corporate social responsibility' (CSR) emphasizes the importance of:

Accepted Answer

Balancing economic, social, and environmental interests

Answer

Maximizing shareholder value without regard to other stakeholders

Answer

Meeting minimum legal compliance requirements

Answer

Avoiding ethical controversies

Question 17

How do ethical decision-making frameworks support the board of directors in promoting ethical leadership in organizations?

Accepted Answer

Offer a structured approach to ethical analysis.

Answer

Eliminate the need for board members to make personal judgments.

Answer

Ensure ethical decisions in all situations.

Question 18

Which ethical decision-making model emphasizes a focus on the rights and interests of individuals?

Accepted Answer

Deontology

Answer

Consequentialism

Answer

Stakeholder Theory

Answer

Virtue Ethics

Question 19

Which of the following is a key aspect of effective stakeholder engagement in ethical leadership?

Accepted Answer

Transparency and dialogue

Answer

Imposing penalties for non-compliance

Answer

Limiting engagement to only major stakeholders

Answer

Prioritizing shareholder interests above all others

Question 20

According to the Sarbanes-Oxley Act, what is a primary responsibility of the audit committee of a public company?

Accepted Answer

Overseeing the company's financial reporting and internal controls

Answer

Hiring and evaluating the CEO and other senior executives

Answer

Developing the company's strategic growth plan

Answer

Managing the day-to-day operational activities of the company

Question 21

Which of the following can be a potential consequence of unethical behavior by a company's board of directors?

Accepted Answer

Loss of public信任 and damage to reputation

Answer

Increased shareholder value and profitability

Answer

Improved employee productivity and morale

Answer

Greater market share and competitive advantage

Question 22

The concept of 'corporate social responsibility' encompasses:

Accepted Answer

The obligation of businesses to consider the impact of their activities on society and the environment

Answer

The exclusive responsibility of government agencies to regulate business conduct

Answer

The duty of employees to obey all company policies regardless of ethical concerns

Answer

The legal requirement for companies to maximize shareholder profits at all costs

Question 23

'Tone at the top' refers to:

Accepted Answer

The ethical values and behaviors demonstrated by senior leadership

Answer

The formal ethical code adopted by the organization

Answer

The level of employee satisfaction within the company

Answer

The external reputation of the company

Question 24

Which of the following is a recommended practice for ethical decision-making by boards of directors?

Accepted Answer

Seeking diverse perspectives and considering multiple viewpoints

Answer

Relying solely on legal advice to determine the ethical course of action

Answer

Suppressing dissenting opinions to maintain board harmony

Answer

Prioritizing shareholder利益 above all other considerations

Question 25

The concept of 'due care' in the context of board responsibilities implies:

Accepted Answer

The obligation of directors to exercise proper diligence in making informed decisions

Answer

The guarantee of the company's financial success

Answer

The requirement for directors to attend every board meeting

Answer

The right of directors to rely completely on management's recommendations

Question 26

Which of the following is a primary responsibility of the board of directors in promoting ethical leadership?

Accepted Answer

Reviewing and updating the company's code of ethics

Answer

Monitoring the company's financial performance

Answer

Developing the company's strategic plan

Answer

Hiring and firing the company's CEO

Question 27

What is a primary challenge faced by boards of directors when balancing the interests of different stakeholders?

Accepted Answer

Reaching a consensus among stakeholders with diverse interests

Answer

Interpreting complex legal regulations

Answer

Gathering enough information to make informed decisions

Question 28

Which of the following is a primary responsibility of the board of directors with regard to ethical leadership?

Accepted Answer

Setting and maintaining an ethical tone and culture for the organization

Answer

Screening and appointing senior management

Answer

Executing the day-to-day operations of the business

Question 29

Which stakeholder group plays a crucial role in ensuring the accountability of boards in ethical matters?

Accepted Answer

Shareholders

Answer

Employees

Answer

Customers

Answer

Suppliers

Question 30

The concept of 'board independence' refers to:

Accepted Answer

The presence of directors who are not affiliated with the organization's management or major shareholders

Answer

Directors who have served on the board for an extended period

Answer

Directors who hold a significant number of shares in the company

Question 31

Which ethical principle emphasizes fairness, impartiality, and equity?

Accepted Answer

Justice

Answer

Beneficence

Answer

Autonomy

Answer

Non-maleficence

Question 32

The primary aim of the 'Sarbanes-Oxley Act' was to:

Accepted Answer

Enhance corporate governance and increase transparency in financial reporting

Answer

Promote environmentally sustainable practices

Answer

Reduce corporate tax liabilities

Question 33

Which of the following is **NOT** a primary responsibility of the board of directors with regard to ethical leadership?

Accepted Answer

Managing day-to-day operations

Answer

Overseeing the ethical conduct of the organization

Answer

Recruiting and hiring senior executives

Answer

Setting the strategic direction of the company

Question 34

Which ethical decision-making framework emphasizes the consideration of the interests of various stakeholders?

Accepted Answer

Stakeholder theory

Answer

Virtue ethics

Answer

Deontology

Answer

Utilitarianism

Question 35

How does stakeholder engagement contribute to ethical leadership in organizations by considering:

Accepted Answer

The interests and values of those affected by the organization's decisions.

Answer

The interests of management only.

Answer

Only the interests of shareholders.

Question 36

What is the primary purpose of a code of ethics for an organization?

Accepted Answer

To provide ethical guidance to employees and stakeholders.

Answer

To enhance the organization's reputation through public relations

Answer

To avoid legal liabilities related to ethical violations

Question 37

Which ethical dilemma frequently confronts boards of directors?

Accepted Answer

Balancing shareholder interests with the interests of other stakeholders, such as employees, customers, or the community.

Answer

Determining the exact monetary value of executive compensation.

Answer

Avoiding conflicts of interest among board members.

Question 38

What is the key responsibility of independent directors on a board?

Accepted Answer

To maintain an objective and unbiased perspective, free from potential conflicts of interest.

Answer

To represent the interest of the largest investors.

Answer

To ensure the board makes decisions that maximize shareholder profits.

Question 39

How does ethical leadership contribute to the long-term success of an organization?

Accepted Answer

By fostering trust and credibility with stakeholders, leading to increased loyalty, support, and reputation.

Answer

By eliminating the need for external regulation.

Answer

By minimizing the risk of legal liabilities.

Question 40

What is the primary purpose of a board audit committee?

Accepted Answer

To review the organization's financial reporting, internal controls, and compliance with relevant laws.

Answer

To provide legal advice to the board.

Answer

To approve major business transactions.

Question 41

Who is a whistleblower and why is it crucial for organizations to have whistleblower protection policies?

Accepted Answer

An individual who reports illegal or unethical behavior within an organization, and whistleblower protection policies safeguard them from retaliation.

Answer

An employee who files a discrimination lawsuit against the organization.

Question 42

How does corporate social responsibility (CSR) differ from ethical leadership?

Accepted Answer

CSR focuses on the organization's overall impact on society, while ethical leadership emphasizes the ethical behavior of individuals within the organization.

Answer

CSR is mandatory, while ethical leadership is voluntary.