Ethical Decision Making &

Social Responsibility


Ethics
The moral evaluation of decisions based on
commonly accepted principles of behavior; the
evaluation results in an action being judged right
or wrong.
The Pyramid of Social Responsibility
Potential Ethical Issues in Marketing
Factors Affecting Ethical Decision Making
Moral Values
deontology
teleology
Opportunity
codes
policies
rewards/punishment
Significant Others
management
peers
Suggestions for Improving Ethical Behavior
Offer training programs which independently and explicitly address
specific treatment of ethical issues.
Limit the opportunity to engage in unethical behavior by providing a well-
developed structure and system of checks and balances, including explicit
penalties for unethical behavior.
Let employees know what penalties the company imposes on those who
engage in unethical behavior.
Recognize how the behavior of co-workers and superiors can influence the
behavior of other employees in the organization.
Develop a code of ethics or ethical policies that are widely communicated
and enforced (see next slide).
In larger organizations, develop an ethics committee to address new issues
and help establish and evaluate existing codes and policies.
Eliminate the bad apples.
Source: Ferrell, O.C. and Gareth Gardiner (1991), In Pursuit of Ethics, USA: Smith Collins.
Key Considerations in Developing and
Implementing a Code of Ethical Conduct
Frequency of Misconduct and
Penalties Under the FSGO
Social Responsibility
Social responsibility is an organizations obligation to
maximize its positive impact and minimize its negative
impact on society.

Community Relations

Green Marketing

Understanding Social Responsibility and
Ethics in a Global Business Environment
Self-Reference Criterion
unconscious reference to ones own cultural values, experiences,
and knowledge as a basis for decisions

Foreign Corrupt Practices Act
makes it illegal for U.S. companies to pay bribes to foreign
officials, candidates, or political parties
bribery vs extortion vs lubrication

International Environment
no international law
local practices condone a certain behavior
favored company is one that does what is necessary
Tough-Minded Management and
Social/Ethical Responsibility
Continuum of Managerial Authority
The Tough-Minded Manager:
Accepts that risks must often be taken and that conflict is inevitable in
making tough choices;
Understands that short-run losses may be inevitable and unavoidable to
achieve long-run success;
Believes that the best long-run approach to business is integrity;
Is aware that ethical problems may arise in the workplace, and of how
ethical decisions are usually made in the workplace;
Has reached a level of moral development where economic self-interest is
not paramount, and where persona ethical values are important;
Has learned that trust is the glue that holds business relationships together;
Believes strongly that maintaining self-esteem and self-respect outweighs
material gain.
Source: Ferrell, O.C. and Gareth Gardiner (1991), In Pursuit of Ethics, USA: Smith Collins.




Integrating Ethics & Social Responsibility
into Marketing Strategy
A Planning Model