CEA Professional Conduct & Organizational Ethics 5 — Questions and Answers
Question 1: Which concept refers to the unwritten expectations, norms, and behaviors that define how employees actually act within an organization?
- Formal ethics policy
- Organizational culture (Correct answer)
- Regulatory compliance
- Mission statement
Correct answer: Organizational culture
Organizational culture encompasses the informal norms and shared values that shape employee behavior beyond written policies.
Question 2: A financial analyst intentionally omits negative data from a client report to make the investment look more attractive. This violates which core ethical principle?
- Loyalty
- Integrity (Correct answer)
- Diligence
- Competence
Correct answer: Integrity
Integrity requires honest and accurate representation of information; omitting negative data deliberately is a clear integrity violation.
Question 3: Which of the following is the BEST example of proactive ethics management in an organization?
- Responding to ethics complaints after they are filed
- Conducting regular ethics training and risk assessments before problems occur (Correct answer)
- Publishing an annual ethics report for regulators
- Hiring an ethics officer only when a scandal occurs
Correct answer: Conducting regular ethics training and risk assessments before problems occur
Proactive ethics management means anticipating and preventing ethical issues through ongoing training and risk assessment rather than reacting after problems arise.
Question 4: An employee accepts a leadership role in a non-profit that directly competes with her employer's charitable foundation. This is BEST described as:
- A professional development opportunity
- A conflict of interest (Correct answer)
- A breach of confidentiality
- An act of insubordination
Correct answer: A conflict of interest
A conflict of interest arises when an employee's outside role creates competing loyalties with her obligations to her employer.
Question 5: What is the primary purpose of an ethics audit within an organization?
- To punish employees who violate the code of conduct
- To assess whether the organization's ethics program is effective and identify gaps (Correct answer)
- To replace the annual financial audit
- To compile a list of all past ethical violations
Correct answer: To assess whether the organization's ethics program is effective and identify gaps
An ethics audit evaluates the effectiveness of ethics policies, culture, and programs, helping organizations identify and address weaknesses.
Question 6: Which scenario BEST demonstrates moral disengagement in a corporate setting?
- An employee reports a colleague's policy violation
- A manager justifies overcharging clients as 'standard industry practice' (Correct answer)
- An executive enforces the company code of conduct strictly
- A team openly debates the ethical implications of a new product
Correct answer: A manager justifies overcharging clients as 'standard industry practice'
Moral disengagement involves rationalizing unethical behavior to avoid self-censure, such as dismissing misconduct as normal industry behavior.
Question 7: According to CEA principles, which approach to resolving an ethical dilemma is MOST structured and reliable?
- Relying on gut instinct
- Asking a trusted colleague for an opinion
- Applying a systematic ethical decision-making framework (Correct answer)
- Choosing the option that benefits the organization financially
Correct answer: Applying a systematic ethical decision-making framework
A systematic ethical decision-making framework ensures all relevant factors—stakeholders, principles, consequences—are considered in a disciplined way.
CEA Professional Conduct & Organizational Ethics 5
Which concept refers to the unwritten expectations, norms, and behaviors that define how employees actually act within an organization?