CEA Stakeholder Rights & Responsibilities 4

Question 1

A company knowingly contracts with a supplier that uses child labor. Which stakeholder accountability principle applies?

Accepted Answer

Extended supply chain responsibility for upstream ethical violations

Answer

Ethical supply chain responsibility extends upstream — companies are accountable for foreseeable harms caused by suppliers they knowingly engage.

Question 2

A bank's fiduciary duty to depositors requires it to:

Accepted Answer

Safeguard deposits and act in depositors' best financial interests

Answer

Fiduciary duty to depositors means the bank must prioritize their financial security and interests, not merely maximize institutional profits.

Question 3

In a stakeholder conflict between profitability and worker safety, the CEA ethical framework favors:

Accepted Answer

A balanced approach that treats safety as a non-negotiable baseline

Answer

Worker safety is a baseline ethical obligation — not a factor to be traded off against profitability — while profitability is pursued within that constraint.

Question 4

Which stakeholder has a right to receive accurate, non-misleading financial disclosures from a publicly traded company?

Accepted Answer

All investors and potential investors

Answer

Securities law and ethical principles require that all investors — institutional and retail — receive accurate and non-misleading financial disclosures.

Question 5

The 'social license to operate' concept means a company must:

Accepted Answer

Earn and maintain ongoing acceptance from affected communities

Answer

A social license to operate is an ongoing, informal grant of acceptance from communities affected by corporate activities, requiring continuous engagement.

(CEA) Certified Ethics Associate Practice Test

(CEA) Certified Ethics Associate Practice Test

CEA Stakeholder Rights & Responsibilities 4