Question

Which of the following are not consequences of a company pursuing a strategy that has unethical or shady components?

a) Damage to the company's reputation
b) Legal repercussions and fines
c) Enhanced stakeholder trust
d) Erosion of employee morale and commitment

Answer 1

Enhanced stakeholder trust is not a consequence of a company engaging in unethical or shady strategies; rather, such behavior typically leads to a damaged reputation, legal issues, and diminished employee morale.

Step-by-step explanation:

The question at hand is considering the potential consequences for a company pursuing a strategy that includes shady components. The consequences not associated with such a strategy would be:

Enhanced stakeholder trust

This outcome is not likely because unethical or shady practices typically lead to the erosion of trust among stakeholders, customers, and the broader community. On the contrary, the consequences associated with unethical corporate strategies can include:

Damage to the company's reputation

Legal repercussions and fines

Erosion of employee morale and commitment

When a company engages in unethical behavior, it risks facing social and legal censure, which could manifest as a damaged reputation, legal challenges, and negative cultural labels. Moreover, there may be internal impacts, such as decreased employee morale, which can further harm the company by reducing productivity and increasing turnover. These outcomes illustrate the crucial link between a company's ethical practices and its long-term success and sustainability.

Answer 2

Enhanced stakeholder trust is not a consequence of unethical corporate strategies; the actual consequences include damage to reputation, legal repercussions, and erosion of employee morale.

Step-by-step explanation:

The consequences of a company pursuing unethical or shady strategies include various negative outcomes, but enhanced stakeholder trust is certainly not among them. The correct choices that describe potential consequences of unethical behavior are:

• Damage to the company's reputation: Unethical practices can result in loss of credibility and respect among consumers, peers, and the broader community.
• Legal repercussions and fines: Depending on the nature of the unethical act, there can be legal sanctions, which may include costly fines or even more severe penalties.
• Erosion of employee morale and commitment: When a company's values are compromised, it can lead to dissatisfaction, lack of trust, and a decrease in loyalty among employees.

These outcomes highlight the importance of maintaining ethical practices to avoid significant negative impact on the company's well-being and its relationships with various stakeholders.