Social Responsibility and Ethics

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					  Social Responsibility
       and Ethics

Marketing I
Mr. Yates
                  Social Responsibility and Ethics
Key Terms         Objectives
flextime          • Provide examples of business’s social
telecommuting       responsibilities
Ad Council        • Explain the concept of business ethics
green             • Apply guidelines for ethical behavior
Better Business
price gouging
     Business and Social Responsibility

Social responsibility and ethics have become important
business topics as trust has deteriorated due to corporate
Corporate scandals and unethical behavior have a very
negative effect on consumer confidence and the image of a
Some businesses believe their role in society includes actions
• The workplace
• The marketplace
• Their communities
• The environment
                    In the Workplace
                    Many business try to accommodate employee needs
                    by creating a user-friendly workplace environment.
                    Flextime allows workers to choose their work hours
flextime            from pre-determined options.
A program that
allows workers to   Telecommuting involves working at home, usually
choose their        on a computer. Completed jobs are transmitted by e-
work hours.         mail or working via servers.
A program that
involves working
at home, usually
on a computer,
with completed
jobs transmitted
by e-mail or
mail-in disk.
In the Workplace

Other benefits are:
• Extended family leave
• On-site child care
• Health care benefits
• Time off with pay

       Sprint World Headquarters
• 18 four- and five-story buildings, one of them a training center
  called the “University of Excellence”;
• a 175-foot clock tower; covered walkways (there are weather
  extremes in Kansas);
• an outdoor amphitheater for 3,000 people; parking garages for
  12,500 cars;
• athletic fields, and hiking and biking trails that connect to
  public trails outside the campus.
• Some other amenities will take this project beyond the
  traditional collegiate model:
   –   a full fitness center,
   –   a child-care center,
   –   private rooms for nursing mothers next to the women's restrooms,
   –   ''war'' rooms,
   –   ''solitude nooks''
   –   and on-line menus from the three food courts.
• Sixty percent of the site will be green space, for which there is
  a $10 million landscaping budget.
• The campus will have 5,000 trees and utilize six million bricks.
Sprint HQ
    Oracle Campus Redwood City, CA
•   Dry Cleaning
•   Gym’s
•   Restaurants
•   Etc.
   Okay, enough about that…
• Why do they do it?

• Back to the customer-side, rather than the
  employee side…
In the Marketplace

Socially responsible companies
cooperate with the government
and consumer groups to provide
important information to

Through its advertising, the Almond
Board of California informs consumers
about the health benefits of almonds.
                    In the Marketplace
Ad Council
A nonprofit
organization that
                    The Ad Council is a nonprofit organization that
helps produce
public service      helps produce public service advertising campaigns
advertising         for government agencies and other qualifying
campaigns for       groups.
agencies and
other qualified
In the Marketplace
In the broadcast industry, standards
for acceptable material are
established by the Federal
Communications Commission
Network executives can also establish
their own policies for self-regulation.
Socially responsible companies also
look for ways to respond to
consumers’ concerns.

This ad from McDonald’s shows the
company’s efforts to promote its
commitment to offering healthier menu
                      The FCC
• The FCC was established by the Communications Act of
  1934 as the successor to the Federal Radio Commission
• Regulates all non-Federal Government use of the radio
  spectrum (including radio and television broadcasting),
• All interstate telecommunications (wire, satellite and
  cable) as well as all international communications that
  originate or terminate in the United States.
• It is an important factor in US telecommunication policy.
• The FCC took over wire communication regulation from
  the Interstate Commerce Commission.
In the Community
• Local businesses try to support community efforts
  by funding teams or helping with food or toy
• Large companies have guidelines and initiatives
  that clearly define how they see their role in
  supporting community causes.
• My old workplace PGE, has been #1 in community
  service for any company in Oregon
• The World Business Council for Sustainable
  Development (WBCSD) is a coalition of
  international companies who try to use business
  leadership to bring about responsible economic
  development, improved efficiency, and corporate
  social responsibility.
                   Business Ethics
                    Ethics are guidelines for good
Basic values and
                    Ethical behavior is based on knowing
moral principles    the difference between right and
that guide the
behavior of
                    wrong and doing what is right.
individuals and
groups.             Ethical businesses follow the laws
                    established for their operations.
Ethics and Consumerism
Consumerism is the effort to protect consumer rights by putting
legal, moral, and economic pressure on businesses.
     Ethics and Consumerism
President John F. Kennedy’s Consumer Bill
of Rights states four basic rights:
1.To be informed and protected against
 fraud, deceit, and misleading
 statements, and to be educated in the
 wise use of financial resources
2.To be protected from unsafe products
3.To have a choice of goods and services
4.To have a voice in product and
 marketing decisions made by
 government and business
                    Ethics in Marketing
                      Ethical principles are important in business because
                      they reflect the management of a company and the
                      trust between a company and its stakeholders.
Business              The Better Business Bureau (BBB) is one of the
Bureau (BBB)          oldest nonprofit organizations to set up self-
One of the oldest     regulation among businesses.
organizations         It has a strict Code of Advertising that defines what
that establishes      is acceptable with regard to truth in advertising.
                    Ethics in Marketing
                      The American Marketing Association’s (AMA)
                      Code of Ethics is a guideline for ethical
                      professional conduct.
price gouging
                      It addresses:
Pricing products
unreasonably          • Honesty
high when there
is a high demand      • Fairness
resulting from a
                      • Rights and duties in marketing
monopoly or a
natural disaster.     • Organizational relationships

                      Price gouging is pricing products
                      unreasonably high when the need is great or
                      when consumers don’t have other choices.
 Ethics in Marketing
Management of marketing information involves issues of
Industries have to keep customer databases private and cannot
share information unless the consumers give their direct
Selling practices that come under scrutiny because of ethical
issues often involve:
• High-pressure tactics used to close a sale
• Bribes
• Kickbacks
• Favors
                    Managerial and Personnel Issues
                    From the top level of authority down, managers
                    must take responsibility for establishing and
whistle             creating a role model for ethical practices within a
blowing             firm.
Reporting an        Accounting and proper reporting of corporations’
illegal action by
                    financial situations are addressed by the
one’s employer.
                    Sarbanes-Oxley Act of 2002.

                    Whistle-blowing involves reporting an illegal
                    action by one’s employer.
Guidelines for Ethical Behavior

Companies with an interest in ethical business
behavior should follow a decision-making process
that includes the following:
• Get the facts.
• Identify all parties concerned.
• Think of all your alternatives.
Guidelines for Ethical Behavior
Evaluate the alternatives by asking the following
• Is it lawful?
• Does it go against company policy?
• How does it affect those involved?
• Will it build a good company reputation?
Section 6.1
• The government plays a critical role in enforcing the free
  enterprise system and providing for the health, welfare, and
  safety of its citizens.
• The three branches of the U.S. government are the
  executive, legislative, and judicial branches.
• The Food and Drug Administration (FDA) and the Consumer
  Product Safety Commission (CPSC) are two federal agencies
  that protect consumers.
• Employment protection at the federal level includes the
  Equal Employment Opportunity Commission (EEOC) and the
  Occupational Safety and Health Administration (OSHA).

Section 6.1
• The Securities and Exchange Commission (SEC) protects
  investors and the Environmental Protection Agency (EPA)
  protects the environment.
• The Federal Trade Commission (FTC) has the responsibility
  of enforcing the principles of a free enterprise system and
  protecting consumers from unfair or deceptive business

Section 6.2

• Socially responsible businesses have policies and
  programs that address issues in the workplace,
  marketplace, community, and environment.
• Business ethics are guidelines for good behavior.
• Ethical businesses are community-conscious.

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