Cultural Norms, Fair & Lovely and

Advertising

Submitted To:
Dr. Samir Kumar Sheel
Professor
Department of Marketing
Faculty of Business Studies
University Of Dhaka
Submitted By:
Nishat Tasnim
Roll: 168; Batch: 20th
Sec: B
Department of Marketing
Faculty of Business Studies
University Of Dhaka

Date of Submission: 27-03-2017

Summary of the case

Social responsibility is an ethical theory, in which individuals are accountable for fulfilling their
civic duty; the actions of an individual must benefit the whole society. In this way, there must be
a balance between economic growth and the welfare of society and the environment. If this
equilibrium is maintained, then social responsibility is accomplished. This article is all about
making socially responsible and ethical marketing decisions in case of selling tobacco to third
world countries. Tobacco industry is one of the largest industries of USA as well as of the world.
But rapidly the annual sale is falling down at about 1 to 2 percent a year. Causes are shown as
Surgeon General’s campaign against smoking, higher cigarette taxes, and the concern about
health of Americans. At this situation these multinational companies of USA are trying hard and
fast in the third world to convince the media, the public, and the policy makers. For this purposes
they are arranging seminars in different countries and inviting journalists, all expenses paid, to
participate in programs that play down the health risks of smoking. As industrialized and
developed countries are discouraging smoking, tobacco companies are targeting the developed
countries with attractive slogans, images etc. A major tobacco company signed a joint venture
agreement with Chinese government to produce in china. Here is a significant fact that with more
than 300 million smokers in China produces and consumes about 1.4 trillion cigarettes per year.
Advertising and sales promotions are also widely used in many countries like Gambia,
Argentina, African countries. For example in Nigeria, promotions for Graduate brand cigarettes
show a university student in his cap and gown. The scope of promotional activity is enormous in
Kenya; Nigeria major tobacco company is the largest advertiser. In many countries, foreign
brand cigarettes are sign of status that also encourages smoking. Government involvement is also
an important factor to conduct tobacco business in third world countries where govt. authorities
often stand to profit from tobacco sales. For example, Brazil collects 75% of the retail price of
cigarettes in taxes and tobacco is the largest cash crop. Assessing the ethics in strategic decisions
is not easy task because whether it is wrong or right differs from country to country. Rather it
depends on different cultures, different perspectives of right and wrong, different legal
requirements and different goals. A framework has been developed by three American ethicists
including utilitarian ethics, rights of parties, justice for fairness. Thus by taking into
consideration all the factors, US tobacco companies can be grown up in third world countries.
Q-1 Asses the ethical and social responsibility implication of the situation
described?
The decision of being ethical and socially responsible in multinational business decision is
related to the common good or benefit of:

1. The business firm: It includes stockholders, management, profit, growth, others.

2. Society: It includes Culture, order, justice, "The good life"

3. The economy: It includes economic growth, allocation of resources, production and

distribution of goods and services.

4. The individual: It includes freedom, health and welfare, self realization, human dignity,
Opportunity.

If the decision respect the rights of individual involved and if the corporate decision respect the
canons of justice or fairness to all parties involved, then the company should accept the decision
of being socially responsible and ethical in all marketing decision. on the other hand, if the
critical factor justify sub optimizing the goals and satisfaction, justify the abrogation of a right,
justify the violation of a canon or justice, then the company should reject the decision.
Q-2 Can you recommend alternative strategies or solutions to the
dilemmas confronting the tobacco companies? To government? What is
the price of ethical behavior?

Answer: Most marketing decisions have ethical ramifications whether business executives
recognize it or not. When proper action is taken, the ethical dimensions go unnoticed, but
whether marketing decision is ethically troublesome, the outcome can be publicly embarrassing
or worse. Alternative means of controlling should include the health-related consequences of
smoking including further promotion of restrictions and tighter controls on the sale and
distribution of tobacco. Social marketing programmers based on the techniques developed by the
tobacco industry should be used. We should use of the industry’s own tactics to counter its
messages. Tobacco companies should recognize that they have a responsibility no just to gain
profit but as well as having people’s health being safe.

The price of ethical behavior can be quite costly. In the instance, if the cigarette were made
aware and had a firm understanding of the harmful effects of smoking, we believe that there
would be fewer smokers. That would mean a less consumers will lead to less sales, and less
money involved to all.
3.Should the US government support US tobacco company interests
abroad?
Ans:The complexity of ethical decisions is compounded in the international setting,which compromises
different cultures,different perspectives of right and wrong,different legal requirements and different
goals.

Ethicist have developed a framework to view ethical implications of strategic decisions by American
firms that the corporate strategy of companies must optimize the mass benefit of all consituencies,respect
the rights of each and every involved individual and parties.

US tobacco companies maintain this framework to a great extent skillfully.The only laws that prohibit US
government assistance to overseas tobacco interests are in the form of amendments to the agriculture and
commerce state justice appropriations act.Restrictions allow for government aid to tobacco companies in
some international trade dispute,and no laws prohibits promotions of tobacco as a cash crop in overseas
aid programs.Tobacco companies of US reap benefits from these programs as the supply of tobacco is
increased for major buyers,most of the consumers are American.After studying the case,we can say that
the government should support the tobacco company for being an american company,and although certain
decisions are unethical,as it is an american business so the government should support US tobacco
companies.