Final answer:
An ethics-based culture can be damaging to an organization by fostering complacency and lack of innovation.
Step-by-step explanation:
A culture based on ethics can have damaging effects on an organization. While it fosters trust and integrity (Answer A), it can also lead to complacency and a lack of innovation (Answer B). When employees become overly focused on following rules and ethical guidelines, they may become resistant to change and unwilling to take risks, which hampers innovation and growth.