BUSINESS ETHICS &

C.S.R PROJECT.
BMS WING

: ETHICS IN
TOPIC

MARKETING

 SUBMITTED TO :
MOGHESE SIR
PRESENTED BY :

TOLE FAISAL
46
 SHAIKH AFREEN
32
 PATEL SHARIQUE
27
 ANSARI VASIL
06
INTRODUCTION

 Marketing ethics is viewed as important because of

marketing’s interface with many diverse stakeholders.
Marketing is a key functional area in the business
organization that provides a visible interface with not
only customers, but other stakeholders such as the
media, investors, regulatory agencies, channel members,
trade associations, as well as others. It is important when
addressing marketing ethics to recognize that it should
be examined from an individual, organizational, and
societal perspective.
CONTD.

 Examining marketing ethics from a narrow issue

perspective does not provide foundational
background that provides a complete understanding
of the domain of marketing ethics. The purpose of
this chapter is to define, examine the nature and
scope, identify issues, provide a decision-making
framework, and trace the historical development of
marketing ethics from a practice and academic
perspective
WHAT IS ETHICS ?
 Moral principles and values that govern the actions of an
individual or group
DEFINITION OF MARKETING ETHICS
 Ethics has been termed the study and philosophy of human
conduct, with an emphasis on the determination of right
and wrong. For marketers, ethics in the workplace refers to
rules (standards, principles) governing the conduct of
organizational members and the consequences of
marketing decisions (Ferrell, 2005). Therefore, ethical
marketing from a normative perspective approach is
defined as “practices that emphasize transparent,
trustworthy, and responsible personal and organizational
marketing policies and actions that exhibit integrity as well
as fairness to consumers and other stakeholders (Murphy,
Laczniak, Bowie and Klein
MARKETING ALLIANCES
 At the outset, it is critical that we define what we mean by
"marketing alliances." A marketing
 alliance is a formal or informal arrangement between
organizations where each seeks through
 marketing activities gains that would not be available to
either without such an alliance. In our
 view, the term alliances encompass two of the three types of
marketing exchange characterized
 by Gundlach and Murphy (1993). Also the concept of ethics
and social responsibility in
 marketing should be understood by the institutions in the
field of academic as well as industry.
CONTD.
 2005). Marketing ethics focuses on principles and standards
that define acceptable marketing conduct, as determined by
various stakeholders and the organization responsible for
marketing activities. While many of the basic principles
have been codified as laws and regulations to require
marketers to conform to society’s expectations of conduct,
marketing ethics goes beyond legal and regulatory issues.
Ethical marketing practices and principles are core building
blocks in establishing trust, which help build long-term
marketing relationships. In addition, the boundary-spanning
nature of marketing (i.e. sales, advertising, and distribution)
presents many of the ethical issues faced in business today.
THE DOMAIN OF MARKETING ETHICS

 Substantive Domain
The relationship between a customer and an organization
exists because of mutual expectations built on trust, good
faith, and fair dealing in their interaction. In fact, there is
an implied covenant of good faith and fair dealing, and
performance cannot simply be a matter of the firm’s own
discretion (Ferrell, 2004). Not only is this an ethical
requirement but it has been legally enforced in some
states.
CONTD.

 The implied covenant of good faith and fair dealing is to

enforce the contract or transaction in a manner consistent
with the parties’ reasonable expectations (1998 WL
1991608 Mich. App.) Courts may impose “implied duties
of good faith” in marketing exchanges (Gundlach and
Murphy, 1993). This obligation of good faith appears to be
an institutional or legal approach to enforcing ethical
conduct in marketing
HISTORICAL DEVELOPMENT OF MARKETING ETHICS

 The consumer protection, especially adulterated food

products. From the beginning of advertising, there have
always been concerns about misrepresentations and
purposeful deception of consumers. Frank Chapman Sharp
started teaching a course in business ethics at the University
of Wisconsin in 1913 and Sharp and Fox (1937) published a
textbook on business ethics. The book was based on the
concept of “fair service” and the authors stated “it will be
possible to reduce our study of fair service to the principles
of fair salesmanship” (Sharp and Fox, 1937). The book
could have been titled ‘Marketing Ethics’ and had chapters
on commercial coercion, let the buyer beware, the limits of
persuasion, fair pricing, and the ethics of bargaining. Within
the academic history of marketing
CONTD.

one of the first articles that appeared in the Journal of

Marketing was an article by Charles F. Phillips (1939)
entitled, “Some Theoretical Considerations Regarding
Fair Trade Laws.” In this article, ethics was not directly
addressed, but the impact of resale price maintenance on
competition, especially channel members and customers,
was addressed. The concern was that customers were not
receiving information about prices and might assume
that the quality of coffee offered by all stores was
identical. Most academic publishing in the 1950s
focused on issues such as fair trade, antitrust, advertising
and pricing.
KEY ISSUES IN MARKETING ETHICS.
 By its very nature, marketing ethics is controversial, and there
is no universally accepted approach for resolving questions.
Ethical issues address a problem, situation, or opportunity that
requires an individual, group, or organization to choose
among several actions that must be evaluated as right or
wrong (Ferrell, Frederick, and Ferrell, 2005). The
organization and stakeholders define marketing ethical issues
that must be identified and resolved to build trust and
effective relationships with stakeholders. Because marketing
ethics sometimes deals with subjective moral choices, this
requires decisions about the moral standards to apply and the
definition of ethics issues (Murphy, Laczniak, Bowie and
Klein, 2005). However, many groups in society, including
government, are defining ethical and legal issues and
proactive approaches to deal with these issues.
CONTD.
 For example, millions of blogs or personal web logs exist
on the Internet without any formal code of ethics or
regulation. Many firms, such as Audi, have their own blogs
with many stakeholders requesting the formation of an
ethics committee to create unified standards. Organizations
are being asked to prevent and control misconduct by
implementing ethical compliance programs. Ethics brings
many rewards to organizations that nurture it, but
managing ethics requires activity and attention on several
levels—complying with the law, setting ethical standards,
and dealing with the complex decisions related to trade-
offs between the bottom line and ethical conduct.
A FRAMEWORK FOR UNDERSTANDING ETHICAL
DECISION MAKING IN MARKETING

 Ethical decision making in marketing parallels ethical

decision making across all organizational domains.
There is much overlap between marketing ethics and
business ethics because the basic frameworks that
describe ethical decision making in an organization
include decisions that encompass marketing. In other
words, within the context of an organization, there is an
ethical component to business decisions, regardless of
whether it is marketing or some other functional area
component. External stakeholder interests, concerns or
dilemmas help trigger ethical issue intensity.