What you’ll learn to do: describe the types of ethical and social responsibility issues that marketing must address

We will begin by introducing definitions to clarify ethical terms and then turn to the issues that marketing professionals most often encounter.

If you’ve taken other business courses, you’ve probably studied business ethics and have some familiarity with examples of corporate malfeasance (which is a fancy term for unethical behavior).  These cases typically involve financial fraud. (Click here if you’d like to read about investor Bernie Madoff, the man responsible for the largest financial fraud in U.S. history). Financial fraud is certainly an example of unethical (and, often, illegal) behavior, but it isn’t directly related to marketing. Despite the presence of financial scandals in the news, you might be surprised to learn that the ethical issues U.S. businesses worry about the most are related to marketing.^[1] Take a look at their “top eight” list of ethical concerns, below:

1. Gifts, gratuities, bribes (marketing and sales)
2. Price discrimination and unfair pricing (marketing and sales)
3. Dishonest advertising (marketing and sales)
4. Miscellaneous unfair competitive practices
5. Cheating customers, unfair credit practices, and overselling (marketing and sales)
6. Price collusion by competitors or price fixing (marketing and sales)
7. Dishonesty in making or keeping a contract
8. Unfairness to employees and prejudice in hiring

You will notice that five of the eight ethical issues cited are governed by the marketing function, and the other three can certainly affect or involve marketing. In this section, you’ll learn more about these issues and the challenges in overcoming them. As with ethics in general, the line between ethical behavior and unethical behavior can be very fine indeed.