M16MKT Marketing ethics & Corporate Social Responsibility,Learning Objectives,2,To define the meaning of ethics, business ethics and marketing ethics To examine the ethical issues in marketing practice To discuss the Stakeholder Theory and its impacts on marketing practice To evaluate the nature and dimensions of Corporate Social Responsibility (CSR) To present arguments for and against CSR programmes,Definitions,Ethics Moral principles and values that govern the actions and decisions of an individual or group. Business Ethics,Moral principles and values that guide a firms behaviour. Written and unwritten codes of principles and values that govern decisions and actions within a company. In the business world, the organizations culture sets standards for determining the difference between good and bad decision making and behaviour.,Marketing Ethics,4,Moral principles and values that guide behaviour within the field of marketing and cover issues, such as (1) product safety, (2) truthfulness in marketing communications, (3) honesty in relationships with customers and distributors, (4) pricing issues and (5) the impact of marketing decisions on the environment and society.,Ethical issues in marketing,5,Ethical issues in marketing,Marketing mix effects on consumers,Political issues,Societal issues,Environmental issues,Societal responses to ethical issues in marketing,Consumerism Environmentalism Ethical Consumption,6,Legal and regulatory responses to ethical issues in marketing,EU competition laws and regulatory bodies that aim to protect the rights of consumers. National laws covering consumer rights and protection. Competition regulation supported by government-backed regulatory bodies. Voluntary bodies set up by industries to create and enforce codes of practice.,7,Honda,Honda is developing affordable, fuel-efficient and less-polluting hybrid cars.,8,Marketing Mix: Product,Potential harm of products to consumers. e.g. genetically modified (GM) food; high levels of fat in food, tobacco, sugar in childrens food (combined with advertising!) Government and businesses taking steps to reduce harmful effect of products (e.g. smoking ban) Creation of Food Standards Agency (FSA) independent food safety body set up to protect public health and consumer interests in relations to food in the UK Portman Group oversees the UKs alcoholic drinks industry: market alcohol in a socially responsible way.,9,Marketing Mix: Price,Firms can collude to force up the price of products. -Interferers with consumers freedom of choice. EU competition policy provides a legal framework designed to prevent firms from colluding.,10,Marketing Mix: Place,Slotting allowances: fee paid by manufacturers to a retailer in exchange for an agreement to place a product on shelves. Distorts competition: favouring large manufactures over smaller ones (who might have superior products!),11,Marketing Mix: Promotion,Exaggerated claims or concealed facts. E.g. food advertised as healthy because of vitamin content, but is high in sugar or fats. Advertising is tightly regulated now! Deceptive Selling: Salespeople deceiving in order to make a sale OR sell the more expensive product.,12,Marketing Mix: Promotion,Direct Marketings invasion of privacy: the unethical practice of entering consumer names and addresses onto databases without consumers permission. Internet Privacy: tracking online shoppers information recorded using “cookies” (downloaded onto shoppers PCs) without permission. Allow marketers to provide customized and personalized content for online shoppers. Promotional inducement to the trade: Offering inducements to retailers to place emphasis on a particular companys products.,13,Green & Black,Ethical brands can also taste wonderful.,14,High-Pressure Selling,Salespeople are trained to deliver smooth, canned talks to entice purchase. Hard sales can occur because of prizes going to top sellers. High-pressure selling: not good for long- term relationships.,15,Marks and Spencer,16,M&S encourages its consumers to look behind the label in one campaign.,Corporate Social Responsibility (CSR),17,Definitions The ethical principle that an organization should be accountable for how its behaviour might affect society and the environment. A voluntary approach that a business enterprise takes to meet or exceed stakeholder expectations by integrating social, ethical, and environmental concerns together with the usual measures of revenue, profit, and legal obligation.,Business ethics and Corporate Social Responsibility (CSR),18,Business ethics is about the application of ethical values, CSR is the expression of those values both within core business strategies and as a set of commitments and obligations made to its stakeholders.,Why is business ethics important?,19,Power of businesses in society is significant Business malpractices have lots of negative impact Few business people have formal ethics training Ethical violations continue