CGM Ethics & Compliance Management Flashcards

In the context of the CGM exam, 'due diligence' in compliance refers to:

Answer: Taking reasonable steps to identify and address compliance risks

Due diligence means proactively identifying and mitigating compliance risks through systematic review.

An employee reports a potential OSHA violation. As a general manager, your FIRST action should be to:

Answer: Investigate the situation and address the hazard immediately

Workplace safety complaints must be investigated and hazards corrected promptly to protect employees and ensure compliance.

Which of the following is an example of a regulatory compliance requirement for US businesses?

Answer: Maintaining EEOC-compliant hiring practices

The Equal Employment Opportunity Commission (EEOC) requires non-discriminatory hiring practices, which is a legal compliance mandate.

A general manager who accepts gifts from vendors in exchange for awarding contracts is engaging in:

Answer: Bribery and a conflict of interest

Accepting gifts in exchange for business decisions constitutes bribery and a direct conflict of interest.

Which internal control mechanism BEST helps prevent financial fraud in an organization?

Answer: Implementing segregation of duties

Segregation of duties ensures no single employee controls all aspects of a financial transaction, reducing fraud risk.

The Foreign Corrupt Practices Act (FCPA) prohibits US companies from:

Answer: Bribing foreign government officials to obtain business

The FCPA makes it illegal for US companies to bribe foreign officials to gain or retain business advantages.