ETHICS AND SOCIAL RESPONSIBILITY IN MARKETING

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CHAPTER
ETHICS AND SOCIAL RESPONSIBILITY IN MARKETING
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NATURE of MARKETING ETHICS

• Ethics doing theright thing

Ethical vs
Legal Personal not punishable - Societal
and Punishable

• Laws

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UNDERSTANDING ETHICAL BEHAVIOR
1st Influence - Societal Culture and Norms

• Culture dictates what is right and wrong,
• so right changes from culture to culture.

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2nd Influence - Business Culture Industry
Practices - B to C

• Early 1900s Caveat Emptor
• A Latin phrase meaning let the buyer beware -
  what you see is what you get, if its not what
  you expected, too bad
• Belief that competition in the marketplace
  corrects abuses

• 1962, Kennedys Consumer Bill of Rights

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Business Culture Industry Practices - B to B

• Ethics of Competition

• Economic Espionage stealing trade secrets
• Includes trespassing, wiretapping, dumpster diving

• Bribes -payment before service

• Kickbacks-payment after service

Both are illegal in U.S., but very common in
developing nations
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3rd Influence- Corporate Culture Expectations

• Corporate Culture shown in dress codes,
• work
  space, compensation

• Code of Ethics
• Whats in it? (pg 85)

• What if its breached?

• Whistle-blowers

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Personal Moral Philosophy and Ethical Behavior

• Moral Idealism
• There is a right thing to do, no matter what the
  cost
• Favored by religious consumer groups

• Utilitarianism
• The right thing to do is what hurts the fewest
• Favored by business executives and the military

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Concept of Social Responsibility

• Profit Responsibility-companys duty is to
  maximize profits

Careful of Profiteering- shrink supply to raise
price profit

• Stakeholder Responsibility-companys duty is to
  protect
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  the interests of the people who
• 
  gain from it

• Societal Responsibility - companys duty is to
  preserve
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  environment while reaping profit

• Green Marketing

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FIGURE 4-2 Three concepts of social
responsibility
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Turning the Table Consumer Ethics and Social
Responsibility

• Includes
• Filing warranty claims after the period expire
• Fraudulent returns of merchandise
• Providing inaccurate credit information
• Pirating digital content
• Submitting phony insurance claims
• Improper disposal of environmentally sensitive
  material

Costs taxpayers billions each year in higher
prices and premiums. Remember - Everybody does
it is not an excuse for abuse
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Concept Check
2. What are three possible reasons for the
present state of ethical conduct in the United
States?
A (1) Pressure on businesspeople to make
decisions in a society with diverse value
systems. (2) Business decisions being judged
publicly by groups with different values and
interests. (3) Ethical business conduct may have
declined.
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Concept Check
1. What rights are included in the Consumer Bill
of Rights?
A The rights to safety, to be informed, to
choose, and to be heard.
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Concept Check
2. What is meant by moral idealism?
A Moral idealism is a personal moral philosophy
that considers certain individual rights or
duties as universal, regardless of the outcome.
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Concept Check
1. What is meant by social responsibility?
A Social responsibility means that organizations
are a part of a larger society and are
accountable to that society for their actions.
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Concept Check
2. Marketing efforts to produce, promote, and
reclaim environmentally sensitive products are
called _____________.
green marketing
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Concept Check
3. What is a social audit?
A A social audit is a systematic assessment of a
firms objectives, strategies, and performance in
the domain of social responsibility.
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Ethics
Ethics are the moral principles and values that
govern the actions and decisions of an individual
or group.
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Laws
Laws are societys values and standards that are
enforceable in the courts.
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Consumer Bill of Rights (1962)
The Consumer Bill of Rights (1962)is a law that
codified (standardized what was not previously
written down) the ethics of exchange between
buyers and sellers. It includes the buyers
rights (1) to safety (2) to be informed (3)
to choose, and (4) to be heard.
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Code of Ethics
A code of ethics is a formal statement of ethical
principles and rules of conduct.
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Whistle-blowers
Whistle-blowers are employees who report
unethical or illegal actions of their employers.
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Moral Idealism
Moral idealism is a personal moral philosophy
that considers certain individual rights or
duties as universal, regardless of the outcome.
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Utilitarianism
Utilitarianism is a personal moral philosophy
that focuses on the greatest good for the
greatest number, by assessing the costs and
benefits of the consequences of ethical behavior.
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Social Responsibility
Social responsibility means that organizations
are a part of a larger society and are
accountable to that society for their actions.
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Green Marketing
Green marketing consists of marketing efforts to
produce, promote, and reclaim environmentally
sensitive products.