CEA Stakeholder Rights & Responsibilities 2

Question 1

A company discovers that a product defect could harm customers but fixing it will cost millions. Under stakeholder ethics, what is the primary obligation?

Accepted Answer

Disclose the defect and initiate a recall

Answer

Stakeholder ethics requires prioritizing customer safety over financial considerations when a known harm exists.

Question 2

Which principle holds that stakeholders have the right to participate in decisions that substantially affect their interests?

Accepted Answer

Stakeholder engagement

Answer

Stakeholder engagement is the principle that those affected by corporate decisions have a right to meaningful participation in those decisions.

Question 3

An employee whistleblower reports ethical violations internally but management ignores the concern. What is the employee's ethical responsibility next?

Accepted Answer

Escalate through available channels, including external regulators if necessary

Answer

When internal channels fail, escalating to external oversight bodies is the ethically appropriate next step to protect broader stakeholder interests.

Question 4

The concept of 'legitimate stakeholder claims' suggests that a stakeholder's claim is valid when it is:

Accepted Answer

Based on a recognized legal, moral, or contractual basis

Answer

A legitimate claim arises from legal rights, moral standing, or contractual relationships — not merely from power or financial position.

Question 5

A supplier discovers that a buyer company is using its products in ways that violate environmental regulations. What is the supplier's stakeholder responsibility?

Accepted Answer

Raise the concern with the buyer and consider contract termination if unresolved

Answer

Suppliers have an ethical responsibility to address misuse of their products and may need to cease the relationship if violations continue.

(CEA) Certified Ethics Associate Practice Test

(CEA) Certified Ethics Associate Practice Test

CEA Stakeholder Rights & Responsibilities 2