Acca F4

 BE 5 Unit Six

Reading Comprehension Questions:

Why are many people skeptical about corporate ethics and how does this relate to “concrete terms?

Most messages to the public from CEOs and corporate boards are full of emotional words and phrases but are not specific about what the company is doing to be responsible. Thus when people hear or read about ethical abuses by companies, they do not believe these words. The article suggests companies should use specific words to explain what they will actually to do improve.

What does it mean to ‘tackle’ issues at the board level and why is this important for companies?

It means to identify problems or issues the company faces and ‘act’ to solve the problems or deal with the issues. Most corporate boards are elected to give an objective view of problems and have the power to solve them.

Why is it important for a company to have a ‘clear compass” and why is transparency important to a business?

A compass is used to know direction and most companies should spend time charting a direction to more ethical behavior and more responsibility. Most companies that are unethical do not allow outsiders to see or know what is going on inside the company, and this proves they are not being responsible to shareholders or the rest of the world.

Explain share-based incentive and how they can help a company.

Senior managers and board members can earn more company stock for good performance of the company, thus they will have more loyalty to and belief in the company. This can cause them to make decisions that keep the company ethical and in a positive public view..

What are sweat shops and how can they affect a company’s image?

Businesses that take advantage of workers with low wages and terrible working conditions. Companies can be seen as greedy or exploitive if they are linked to these businesses.