College of Saint Adela Inc.

Daang Bario, Poblacion 1, City of San Jose Del Monte, Bulacan

Contact Numbers: 0933-8551388 / 0917-6879632
E-mail Address: csa_adela@yahoo.com
5th to 6th Week

Ethics and Social Responsibility

• Why learn about ethics and social responsibility?

- Generally speaking, students believe that there are two primary reasons to act ethically:
1. Acting ethically is the right thing to do from a moral perspective;
2. If you act unethically, then you might get caught and be punished.

Neither of these is a bad reason to apply principles of ethics and social responsibility, but it is worth
considering another reason, as well. In most cases strong ethical behavior leads to strong business results.
Behaving ethically is actually good business.

• What you’ll learn to do: describe the types of ethical and social responsibility issues that
marketing must address

We will begin by introducing definitions to clarify ethical terms and then turn to the issues that
marketing professionals most often encounter.

Top eight list of ethical concerns, below:

1. Gifts, gratuities, bribes (marketing and sales)

2. Price discrimination and unfair pricing (marketing and sales)

3. Dishonest advertising (marketing and sales)

4. Miscellaneous unfair competitive practices

5. Cheating customers, unfair credit practices, and overselling (marketing and sales)

6. Price collusion by competitors or price fixing (marketing and sales)

7. Dishonesty in making or keeping a contract

8. Unfairness to employees and prejudice in hiring

You will notice that five of the eight ethical issues cited are governed by the marketing function, and the
other three can certainly affect or involve marketing. In this section, you’ll learn more about these issues
and the challenges in overcoming them. As with ethics in general, the line between ethical behavior and
unethical behavior can be very fine indeed.

Ethics is the set of moral principles or values that guides behavior. There is a general recognition that
many, if not most, business decisions involve some ethical judgment.

• Each party in a marketing transaction brings a set of expectations regarding how the business
relationship will exist and how transactions should be conducted. For example, when you as a
consumer wish to purchase something from a retailer, you bring the following expectations about
 the transaction: (a) you want to be treated fairly by the salesperson, (b) you want to pay a
reasonable price, (c) you want the product to be available as advertised and in the indicated
condition, and (d) you want it to perform as promised.
• Unfortunately, your expectations might not be in agreement with those of the retailer. The retail
salesperson may not “have time for you,” or the retailer’s notion of a “reasonable” price may be
higher than yours, or the advertising for the product may be misleading. These differences in
expectations can lead to ethical questions that are sometimes difficult to analyze.

Whereas social responsibility is achieved by balancing the interests of all stakeholders in the
organization, ethics relates to acceptable standards of conduct in making individual and group decisions.

Marketing ethics goes beyond legal issues. Ethical marketing decisions foster mutual trust
in marketing relationships.

How Social Responsibility and Ethics improve marketing performance?

• Socially responsible companies (and their employees) can better respond to stakeholder demands.
A company's reputation for social responsibility is important to consumers' buying decisions. Social
responsibility and ethical behavior reduce the costs of legal violations, civil litigation, and damaging
publicity.
• Practicing ethics in marketing means deliberately applying standards of fairness, or moral rights
and wrongs, to marketing decision making, behavior, and practice in the organization those
organizations that develop a competitive advantage are able to satisfy the needs of both
customers and the organization.

The major difference between social responsibility and marketing ethics

• Social responsibility deals with the total effect of marketing decisions on society,
whereas marketing ethics relates to individual and group evaluations in marketing situations.
• social responsibility in marketing promotes an enhanced company image, which can significantly
impact profitability and even productivity favorably.
• Social responsibility is a means of achieving sustainability. ... The responsibility of an organization
for the impacts of its decisions and activities on society and the environment, through transparent
and ethical behavior that: Contributes to sustainable development, including health and the welfare
of society.
• social responsibility holds that businesses should be good citizens, balancing their money-making
operations with activities that benefit society, be it on a local, national, or global scale. Social
responsibility in marketing involves focusing efforts on attracting consumers who want to make a
positive difference with their purchases. Many companies have adopted socially responsible
elements in their marketing strategies as a means to help a community via beneficial services and
products.
How Social Responsibility in Marketing Works
• Recyclable packaging, promotions that spread awareness of societal issues and problems, and
directing portions of profits toward charitable groups or efforts are examples of social
responsibility marketing strategies.
• As a result of these donations, the company brands itself as socially responsible and charitable,
which ultimately attracts customers who are motivated by socially responsible commitments and
who want to support the welfare of the community.
• Corporate responsibility goes hand in hand with socially responsible practices
for example, administrators, executives, shareholders, and stakeholders must practice ethical
behaviors and join the community in promoting responsible marketing efforts.

ACTIVITY No. 1

Answer the following questions;

1. Define ethics and business ethics?

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2. Many organizations are primarily concerned with earning a profit or a return on their investment?

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3. Imagine you are a salesperson. When does offering a gift, such as basketball tickets become a bribe

rather than just a sales practice?

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4. What makes ethical decisions so difficult?

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 5. Describe why ethical behavior is good for business

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ACTIVITY NO. 2
1. Find the examples of environmental issues in newspaper or business journals then paste inside the

box.

2. List the steps for dealing with an ethical dilemma

1. _______________________________________________________________________________

2. _______________________________________________________________________________

3. _______________________________________________________________________________

4. _______________________________________________________________________________

5. ________________________________________________________________________________