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Chapter 3 – Ethics and
Social Responsibility
Is it okay to get around the law if you
don’t actually break the law?
 What are ethics?
 The moral principles
or values that
generally govern the
conduct of an
individual.
 How is that different
from morals?
 The rules people
develop as a result
of cultural values and
norms.
 Moral Idealism
 Utilitarianism
Understanding Ethical Marketing Behavior
 Societal Culture and Norms
 Business/Industry Practices
 Ethics of Exchange
 Ethics of Competition
 Corporate Culture
Code of Ethics
 A guideline to help
managers and other
employees make good
decisions
Ethical Developmental Levels
More
Childlike
More
Mature
Preconventional
Morality
• Based on what will be
punished or rewarded
• Self-centered, calculating,
selfish
Conventional
Morality
• Moves toward the
expectations of society
• Concerned over legality and
the opinion of others
Postconventional
Morality
• Concern about how they judge
themselves
• Concern if it is right in
the long run
Ethical Decision Making
 Influential Factors
Extent of Problems
Probability of Harm
Top Management
Actions
Time Until
Consequences
Potential Consequences
Number Affected
Social Consensus
Corporate Social
Responsibility
 Requires that the company:
 Be philanthropic


“Give back”
Be a good citizen
 Be ethical

Do what is right
 Operate legally

Obey laws
 Be economically responsible

Make a profit
Sustainability
 Socially responsible firms will outperform
competitors by focusing on the world’s problems
and viewing them as opportunities to build profits
AND help the world.
 Companies cannot thrive in a world where billions
of people are suffering and desperately poor
Cause Marketing
 Tying the charitable
contributions of a firm
directly to sales
produced through the
promotion of one of its
products