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Ethics

the moral principles and values that govern the actions and decisions of an individual or group; deals with personal moral principles and values

Laws

Society's values and standards that are enforceable in the courts

Four possible reasons the state of perceived ethical business conduct is at its present level

o 1. There is increased pressure on businesspeople to make decisions in a society characterized by diverse value systems
o 2. There is a growing tendency for business decisions to be judged publicly by groups with different values and interests
o 3. The public's expectations of ethical business behavior has increased
o 4. Ethical business conduct may have declines

Culture

the set of values, idea, and attitudes that are learned and shared among the members of a group

Business cultures

compromise the effective rules of the game, the boundaries between competitive and unethical behavior, and the codes of conduct in business dealings.

Caveat emptor

a legal concept before the 1960's which stressed to let the buyer beware

Consumer Bill of Rights

outlined by JFK in 1962; it codified the ethics of exchange between buyers and sellers
o 1. Right to safety
o 2. Right to be informed
o 3. Right to choose
o 4. Right to be heard

Economic espionage

the clandestine collection of trade secrets of propriety information about a company's competitors
 Activities include: illegal trespassing, theft, fraud, misrepresentation, wiretapping, looking through competitor's trash

Bribes

giving and receiving
 Disguised as gifts, consultant fees, and favors.
 Bribery on a worldwide scale is monitored by Transparency International.

Corporate culture

the set of values, ideas, and attitudes that is learned and shared among the members of an organization.

Code of ethics

a formal statement of ethical principles and rules of conduct; rarely enough to ensure ethical behavior

Whistle-blowers

employees who report unethical or illegal actions of their employers.

Moral philosophy

learned through the process of socialization with friends and family and by formal education. Two prominent personal moral philosophies have direct bearing on marketing practice: 1. Moral idealism and 2. Utilitarianism.

Moral idealism

a personal moral philosophy that considers certain individual rights or duties as universal, regardless of the outcome.

Utilitarianism

A personal moral philosophy that focuses on "the greatest good for the greatest number" by assessing the costs and benefits of the consequences of ethical behavior.

Social responsibility

organizations are part of a larger society and are accountable to that society for their actions

Profit responsibility

companies have a simple duty: to maximize profits for their owners or stockholders.

Stakeholder responsibility

Focuses on the obligations an organization has to those who can affect achievement of its objectives. (consumers, employees, suppliers, distributors, etc)

Societal responsibility

Obligations that organizations have to the preservation of the ecological environment and to the general public.

Triple-bottom line

recognition of the need for organizations to improve the state of people, the planet, and profit simultaneously if they are to achieve sustainable, long-term growth.

Green marketing

marketing efforts to produce, promote, and reclaim environmentally sensitive products

Cause marketing

occurs when the charitable contributions of a firm are tied directly to the customer revenues produced through the promotion of one of its products.

Social audit

A systematic assessment of a firm's objectives, strategies, and performance in terms of social responsibility.

Sustainable development

involves conducting business in a way that protects the natural environment while making economic progress.

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