Page 110 - Foundations of Marketing

The Marketing Environment, Social Responsibility, and Ethics | Chapter 3 77

Social Responsibility and
Strategic Planning
Walmart deals with consumer
environmental concerns
through reducing waste in the
supply chain and using alterna-
tive fuel in some fleet trucks.

AP Images/Associated Press

Without compliance programs and uniform standards and policies for conduct, it is hard
for a company’s employees to determine what conduct is acceptable within the company.
In the absence of such programs and standards, employees generally will make decisions
based on their observations of how their peers and superiors behave. To improve ethics,
many organizations have developed codes of conduct (also called codes of ethics ) con-
sisting of formalized rules and standards that describe what the company expects of its
employees. The New York Stock Exchange now requires every member corporation to have
a formal code of conduct. Codes of conduct promote ethical behavior by reducing opportu-
nities for unethical behavior; employees know both what is expected of them and what kind
of punishment they face if they violate the rules. Such codes are important in preventing
misconduct within the organization. Effective content, the frequency of communication
regarding the code, the quality of communication, and the incorporation of the code into the
organization by senior and local management can result in less instances of observed uneth-
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ical behavior. Codes help marketers deal with ethical issues or dilemmas that develop
in daily operations by prescribing or limiting specific activities. Codes of conduct often
include general ethical values such as honesty and integrity, general legal compliance,
harmful acts, and obligations related to social values, as well as more marketing-specific
issues such as confidentiality, responsibilities to employers and clients, obligations to the
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profession, and marketing-specific legal and technical compliance issues.
It is important that companies consistently enforce standards and impose penalties or
punishment on those who violate codes of conduct. Barrett-Jackson, an auction company
specializing in classic and collector cars, recognizes the importance of ethical conduct to
its customers. Ethical standards are such a significant part of the company’s culture that it
hired a top auditing firm to conduct an independent examination of its practices. To create an
effective compliance program and to stave off the types of misconduct found in similar orga-
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nizations, Barrett-Jackson constantly reviews and updates it policies. Table 3.4 lists some
commonly observed types of misconduct as reported in the National Business Ethics Survey
(NBES). To succeed, a compliance program must be viewed as part of the overall marketing codes of conduct Formalized
strategy implementation. If ethics officers and other executives are not committed to the prin- rules and standards that
ciples and initiatives of marketing ethics and social responsibility, the program’s effectiveness describe what the company
will be in question. expects of its employees

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