Ethics in Operations (AQA A Level Business): Flashcards
Exam code: 7132
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Define supplier code of conduct.
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Define supplier code of conduct.
A supplier code of conduct is a formal set of standards a business requires its suppliers to follow.
Which areas does a supplier code of conduct typically cover?
It typically covers labour rights, health and safety and environmental practices.
How do clear, consistent expectations in a code benefit a business?
Clear, consistent expectations reduce the risk of misunderstanding the standards suppliers are required to meet.
True or False?
A supplier code of conduct protects suppliers' workers but brings no benefit to the business that writes it.
False.
A code helps protect the business's reputation, as stakeholders expect ethical practices throughout the supply chain. It also reduces legal and reputational risk from suppliers that break the law.
What does a code of conduct give a business if a supplier seriously breaches the agreed standards?
It gives the business clear grounds to end the relationship with that supplier.
Define supplier audit.
A supplier audit is a formal check, carried out by a business or an independent third party, to verify that a supplier is actually complying with the agreed standards.
True or False?
A supplier agreeing to a code of conduct does not guarantee that it will follow the code in practice.
True.
Agreeing to a code does not guarantee compliance. An audit is still needed to confirm whether a supplier is genuinely following the code in practice.
How do supplier audits help protect a business's reputation?
Audits help identify problems early, before they escalate into a serious ethical or legal issue.
Regular audits encourage ____________________ by highlighting areas where a supplier needs to make changes over time.
Regular audits encourage continuous improvement by highlighting areas where a supplier needs to make changes over time.
Who can a business show audit evidence to?
A business can show audit evidence to customers, investors or regulators to prove it takes ethical sourcing seriously.
What ethical tension do businesses face when sourcing suppliers?
A business must decide how much priority to give to cost and efficiency versus the fair and responsible treatment of suppliers and their workers.
Why is paying suppliers unfairly low prices an ethical issue?
Low prices may force suppliers to cut corners on wages or working conditions in order to remain profitable.
Delaying payments to suppliers can cause _______ problems, particularly for smaller suppliers who rely on being paid promptly.
Delaying payments to suppliers can cause cash flow problems, particularly for smaller suppliers who rely on being paid promptly.
True or False?
Sourcing a material can raise ethical issues even when it is legal in the material's country of origin.
True.
Materials may still be linked to environmental damage, human rights abuses or conflict, even where this is not illegal in the country of origin.
What must a business weigh up when choosing cheaper suppliers?
It must weigh the money saved against the damage to its reputation if those suppliers are later found to be acting unethically.
What ethical dilemma does safety testing create for a business?
Additional testing makes a product safer but increases costs and delays its launch.
True or False?
A product that meets the legal minimum safety standards poses no risk to customers.
False.
Meeting the legal minimum does not always guarantee a product poses no risk. Businesses must judge what is a genuinely safe standard.
Why might a business hesitate to recall a product with a safety concern?
A recall brings significant costs and can cause reputational damage.
Safety information and warnings should be clear and ________ to all customers, including those with additional needs.
Safety information and warnings should be clear and accessible to all customers, including those with additional needs.
What ethical choice do materials and components raise for product safety?
A business must weigh the cost of higher-quality, safer materials against pressure to keep production costs low.
A business must decide whether to invest in more ______________________ processes or equipment, even where this isn't legally required and increases costs.
A business must decide whether to invest in more environmentally friendly processes or equipment, even where this isn't legally required and increases costs.
Why can waste and pollution raise ethical questions even when legal limits are met?
Waste and pollution can still harm local communities living near a business's operations.
What ethical question does transparency raise about a business's environmental impact?
A business must decide how transparent to be with customers and investors about the true environmental impact of its operations.
What must a business balance against short-term financial pressures in environmental decisions?
A business must balance short-term financial pressures against the longer-term environmental consequences of its decisions.
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