This document discusses ethics and social responsibility in marketing planning. It defines ethics as acting rightly according to predefined standards, while social responsibility refers to an organization maximizing its positive impacts and minimizing negatives. The document outlines dimensions of social responsibility including economic, legal, ethical and philanthropic responsibilities. It also discusses incorporating ethics and social responsibility into marketing strategy, potential ethical issues in marketing, organizational determinants of ethics, and challenges of being ethical and socially responsible.

1. Ethics & Social Responsibility in Marketing
Planning
Marketing Management [MKTG 315] Lecture 4
With Texts Based on Kotler & Keller (2012), Ferrell & Hartline (2011)
Lartey Jared Offei
Entrepreneurship Training Institute [E.T.I]
Corresponding E-mail:
joffei@vvu.edu.gh
Facebook||Twitter: @offeijared
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Scholar

2. • Defining ethics and social responsibility
• Dimensions of social responsibility
• Integrating ethics and social responsibility in marketing
• Potential ethical issues in marketing
• Organizational determinants of ethics and social
responsibility
• Challenges of being ethical and socially responsible
- How do ethics and social responsibility single out?
- What is the connection between ethics, social responsibility
& strategy?
- What potential ethical issues confront marketers today?
- What challenges militate the practice of ethics and social
responsibilities?
Lecture Outline/Questions

3. • The role of ethics and social responsibility in marketing has
grown in recent years.
• Many firms have seen their reputation, customer
relationships, trust, brands and marketing efforts destroyed
by problems in these areas.
• Given the developments in customer voice over social
media and growing investor expectations, ethics in
marketing has climbed a new level.
• Strategic marketing planning is equally adapting. For
instance recently, corporate use of renewable energy
sources and carbon offsetting are becoming a means to act
right and create a positive image among stakeholders.
• In this lecture, we look at connection between ethics, social
responsibility and marketing strategy.
Overview

4. • Broadly, the application of ethics relates to acting or doing
what is right. To be more specific, an organization would
have to act within authority and meet expected / predefined
standards.
• However, this subject of acting ethically without emphasis
on social responsibility lacks adequate justice.
• Social responsibility as a broad concept relates to an
organization’s obligation to maximize its positive impact on
society, while minimizing its negative impact.
• Ethics and social responsibility create an atmosphere for
organizations and individuals to go beyond legal and
regulatory obligations to act right and satisfy the needs of
consumers, the organization and stakeholders. While
maintaining a focus on the organization’s impact on society;
one which sustains it.
Overview

5. • To get a clear picture, organizations operate and are
‘homed’ within society, are employed by society and
acquires their resources from society. Hence, it should
ensure that its activities are sustainable, beneficial to society
and do not create a negative footprint in society.
• Class activity
• So how do ethics and social responsibility single out?
Overview

6. Dimensions of Social Responsibility
Economic Responsibilities
As a foundation, be profitable
Legal Responsibilities
Obey the law, play by the rules
Ethical Responsibilities
Be ethical, just, fair, avoid
harm
Philanthropic
Responsibilities
Good corporate citizen
Carroll A. (1991). The Pyramid of Social Responsibility

7. • Social responsibility consist of four dimensions or
responsibilities.
• Economic, Legal, Ethical and Philanthropic.
Economic
• From an economic perspective, all firms must be
responsible to their shareholders, by of course earning a
return on their investment.
• The economic responsibility of making profits also serve
employees and the community at large due to its impact on
employment and income levels in areas that the firm calls
home.
• Arguably, economic responsibilities serve as a foundation
upon which other responsibilities rest.
Dimensions of Social Responsibility

8. Legal
• At the next level of the pyramid, marketers have
expectations, at a minimum to obey laws and regulations.
• There is a need to work within society’s codification of right
and wrong.
• Sometimes this is a challenge because the legal and
regulatory environment is hard to navigate and
interpretations of the law change frequently.
• But without concern for economic and legal responsibilities,
the firm may not survive long enough to engage in ethical
and philanthropic activities.
Dimensions of Social Responsibility

9. Ethical
• Marketing ethics refer to principles and standards that
define acceptable marketing conduct as determined by the
public, government regulators, interest groups, competitors
and the firm itself.
• Being ethical requires a great deal of commitment. For this
reason some companies tend to focus on economic and
legal responsibilities.
• Ethical marketing decisions foster trust, which helps build
long-term marketing relationships.
• Ethical misconducts however destroy the careers of
employees and firms willing to achieve targets via various
unethical means.
• Recently, companies are creating extensive ethics
compliance programs to identify problems early on.
Dimensions of Social Responsibility

10. Philanthropy
• Philanthropic responsibilities are associated with firms that
choose to take extra steps that concern themselves with
giving and investing financial / non-financial resources in
their local communities and environment.
• Such philanthropic activities are aligned with their marketing
and brand image.
• For example – The Twilluim group Gh, Vodafone Gh.
• Usually, philanthropic responsibilities are the most visible
socially responsible activities to the public.
Dimensions of Social Responsibility

11. • Many firms integrate ethics and social responsibility into
their strategic planning by ethics compliance programs or
integrity initiatives.
• Such programs establish, communicate and monitor a firm’s
ethical values and legal requirements through codes of
conduct, training programs and audits.
• The marketing plan should include distinct elements of
ethics and social responsibility as determined by top
management.
• Marketing strategy and implementation plans should be
developed to reflect an understanding of:
1. Risks associated with ethical and legal misconduct.
2. Ethical and social consequences of strategic choices.
3. Values of organizational members and stakeholders.
Incorporating Ethics & Social Responsibility

12. • Ethical and socially responsive strategies should as well be
met with strong leadership.
• As many would agree, the success of most admired
companies emanate from their leaders.
• Employees look to the leader as a model of acceptable
behavior.
• In fact, maintaining an ethical culture is nearly impossible if
top management does not support ethical behavior through
development of policies and standards.
• In the realm of marketing ethics, managers are required to
accept responsibilities for their marketing actions.
• See Toyota’s recall of vehicles.
Incorporating Ethics & Social Responsibility

13. Product Issues
• Misrepresentation of goods and services
• Failing to disclose product defects
• Counterfeit or gray-market products
• Misleading warranties
• Reducing package contents without reducing size
Potential Ethical Issues in Marketing

14. Pricing Issues
• Price deception
• Reference pricing claims
• Price discrimination
• Predatory pricing
Potential Ethical Issues in Marketing

15. Distribution Issues
• Exclusive distribution arrangements
• Withholding product availability
• Withholding product / promotional support
• Opportunistic behavior among members of the supply chain
Potential Ethical Issues in Marketing

16. Promotion Issues
• False and misleading advertising
• High pressure salespeople
• Bribery of purchasing agents
• Gift giving
• Sexual overtone in advertising
Potential Ethical Issues in Marketing

17. Other Issues
• Misrepresenting the firm’s capabilities
• Manipulation / misuse of data or information
• Exploitation of children or disadvantaged groups
• Invasion of privacy
• Abusive behavior
Potential Ethical Issues in Marketing

18. • Although individuals within an organization can and do
make ethical decisions, they do not operate in a vacuum.
• Ethical choices in marketing are often made jointly in
workgroups or committees through conversations.
• Organizational determinants of ethics and social
responsibilities include:
1. The strength of individual personal values.
2. The opportunity for unethical behavior.
3. Exposure to others who behave ethically or unethically.
4. Corporate / Industry culture (climate).
5. Public/stakeholder demand for ethical behavior.
Organizational Determinants of Ethics/Social
Resp.

19. • While the values of ethics and social responsibility are
universally accepted, business decisions involve complex
and detailed discussions in which correctness may easily be
overshadowed.
• Individuals with limited business experience often find
themselves required to make sudden decisions on product,
quality, advertising, sales techniques, pricing and privacy.
• Personal values learned from socialization through family,
religion and school may not provide specific guidelines for
complex business decision making.
• Moreover, the interests and values of individuals may differ
from that of the company in which they work. That is,
personal values may be inconsistent with that shared by the
workgroup.
• The development and cultivation of a culture that shares a
vision for ethical and socially responsible behavior can be
The Challenges of Being Ethical / Socially
Responsible

20. Marketing Insight
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