Transcript Chapter 4 - Personal homepages

CHAPTER
ETHICS AND
SOCIAL
RESPONSIBILITY
IN MARKETING
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-1
AFTER READING THIS CHAPTER
YOU SHOULD BE ABLE TO:
1. Explain the differences between legal
and ethical behavior in marketing.
2. Identify factors that influence ethical
and unethical marketing decisions.
3. Describe the different concepts of social
responsibility.
4. Recognize unethical and socially
irresponsible consumer behavior.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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THERE IS MORE BREWING AT
ANHEUSER-BUSCH THAN BEER
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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NATURE AND SIGNIFICANCE OF
MARKETING ETHICS
• Ethics
• Ethical/Legal Framework in Marketing
 Laws
• Current Perceptions of Ethical Behavior
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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Concept Check
1. What are ethics?
A: Ethics are the moral principles and
values that govern the actions and
decisions of an individual or group.
They serve as guidelines on how to
act rightly and justly when faced
with moral dilemmas.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-5
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.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-6
UNDERSTANDING ETHICAL
MARKETING BEHAVIOR
• Societal Culture and Norms
 Culture
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FIGURE 4-1 A framework for understanding
ethical behavior
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UNDERSTANDING ETHICAL
MARKETING BEHAVIOR
• Business Culture and Industry Practices
 Business Cultures
 Ethics of Exchange
• Caveat Emptor
• Consumer Bill of Rights
• U.S. Consumer Product Safety Commission
• Federal Trade Commission (FTC)
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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Federal Trade Commission
Is your online privacy protected?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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UNDERSTANDING ETHICAL
MARKETING BEHAVIOR
• Business Culture and Industry Practices
 Ethics of Competition
• Economic Espionage
• Bribes
• Kickbacks
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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UNDERSTANDING ETHICAL
MARKETING BEHAVIOR
• Corporate Culture and Expectations
 Corporate Culture
 Code of Ethics
 Ethical Behavior of Top Management and
Co-workers
• Whistle-blowers
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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UNDERSTANDING ETHICAL
MARKETING BEHAVIOR
• Personal Moral Philosophy and
Ethical Behavior
 Moral Idealism
 Utilitarianism
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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FIGURE 4-A Personal moral philosophies
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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3M Scotchgard
Which moral philosophy did 3M use and why?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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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.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-16
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.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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UNDERSTANDING SOCIAL
RESPONSIBILITY IN MARKETING
• Concepts of Social Responsibility
 Profit Responsibility
• Profiteering
 Stakeholder Responsibility
 Societal Responsibility
• Green Marketing
• Cause Marketing
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-18
FIGURE 4-2 Three concepts of social
responsibility
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Avon
Why do companies engage in cause marketing?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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UNDERSTANDING SOCIAL
RESPONSIBILITY IN MARKETING
• The Social Audit: Doing Well by Doing
Good
 Social Audit
 Sustainable Development
• Turning the Table: Consumer Ethics
and Social Responsibility
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-21
Ronald McDonald House
How do companies ‘do well by doing good’?
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Reebok
Why is sustainable development important?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-23
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.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-24
Concept Check
2. Marketing efforts to produce,
promote, and reclaim
environmentally sensitive products
green marketing
are called _____________.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-25
Concept Check
3. What is a social audit?
A: A social audit is a systematic
assessment of a firm’s objectives,
strategies, and performance in the
domain of social responsibility.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-26
GOING ONLINE
DOING WELL BY
DOING GOOD
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Going Online
1. Visit the BSR website. Can you
update at least one example in the text
related to your chosen topic?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-28
VIDEO CASE 4
STARBUCKS CORPORATION:
SERVING MORE THAN
COFFEE
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VIDEO CASE 4
Starbucks
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VIDEO CASE 4
Starbucks
FIGURE 1 Starbucks Mission Statement and
Guiding Principles
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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VIDEO CASE 4
Starbucks
1. How does Starbucks’ approach to
social responsibility relate to the
three concepts of social
responsibility described in the text?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-32
VIDEO CASE 4
Starbucks
2. What role does sustainable
development play in Starbucks’
approach to social responsibility?
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-33
SUPPLEMENTAL
LECTURE NOTE 4-1
THE FIVE MOST COMMON
KINDS OF ECONOMIC
ESPIONAGE
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Slide 4-34
IN-CLASS ACTIVITY 4-1
THE ETHICS OF
COMPETITIVE
INTELLIGENCE
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Slide 4-35
Fuld & Company Brochure
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Slide 4-36
Ethics
Ethics are the moral principles and values
that govern the actions and decisions of
an individual or group.
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Slide 4-37
Laws
Laws are society’s 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 the ethics of
exchange between buyers and sellers,
including the rights (1) to safety,
(2) to be informed, (3) to choose, and
(4) to be heard.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
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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.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-41
Moral Idealism
Moral idealism is a personal moral
philosophy that considers certain
individual rights or duties as universal,
regardless of the outcome.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-42
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.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-43
Social Responsibility
Social responsibility means that
organizations are a part of a larger society
and are accountable to that society for
their actions.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-44
Green Marketing
Green marketing consists of marketing
efforts to produce, promote, and reclaim
environmentally sensitive products.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-45
Cause Marketing
Cause marketing occurs when the
charitable contributions of a firm are tied
directly to the customer revenues
produced through the promotion of one of
its products.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-46
Social Audit
A social audit is a systematic assessment
of a firm’s objectives, strategies, and
performance in terms of social
responsibility.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.
Slide 4-47