BA370 Chapter 4

. The purpose of conscious marketing is to make a product by selling products and services.

FALSE

. Marketing ethics is concerned with distinguishing between right and wrong actions and decisions that arise in a business setting, according to broad and well-established moral and ethical principles that might arise in a business setting, and any special duties or obligations that apply to persons engaged in commerce.

FALSE

Marketing ethics can involve societal issues such as the sale of products or services that may damage the environment or global issues such as the use of child labor.

TRUE

The consideration of stakeholders and their interdependence is one of the four overriding principles of conscious marketing.

TRUE

. Key corporate social responsibility (CSR) stakeholders include employees, customers, the marketplace, and society.

TRUE

When Walmart pressured its vendors to supply it with environmentally friendly merchandise with labels to prove it, this most relates to the concept of sustainability.

TRUE

One way in which conscious marketing differs from corporate social responsibility (CSR) is that CSR takes a holistic, ecosystem view of business as a complex, adaptive system.

FALSE

From a conscious marketing perspective, social responsibility is at the core of the business through the higher purpose and viewing the community and the environment as stakeholders.

TRUE

Coca-Cola spent $102 million through The Coca-Cola Campaign focusing on water stewardship, healthy and active lifestyles, community recycling, and education. This is an illustration of a CSR program.

TRUE

The first step in ethical decision making is to gather information and identify stakeholders.

FALSE

The Golden Rule test asks the question, "Would I like to be on the receiving end of this action and all its potential consequences?"

TRUE

A roofing company agreed to complete a job in one week and collected a 50 percent deposit, but never showed up to do the job. The same roofing company then donated $6,000 to a local children's hospital. The roofing company could be considered socially responsible.

TRUE

BlendMate, a firm that manufactures high-end blenders, donates $10 per blender sold to a local food bank. This is a form of corporate social responsibility.

TRUE

Ethos Water donates 2 percent of its profits to children in need of clean water. This action demonstrates that Ethos Water is a firm with a strong ethical climate.

FALSE

Corporate social responsibility refers to the coordinated actions of government organizations to address the ethical, social, and environmental impacts of business operations.

FALSE

Among the key differences between conscious marketing and CSR is the unique view on shareholders that is absolutely critical to CSR.

FALSE

Stakeholders typically include the firm's employees and their families, customer groups, members of the community, the environment, and the firm's partners and competitors.

TRUE

Brainstorming in the ethical decision-making framework occurs immediately following the identification of issues.

FALSE

Badger Hardware was planning on raising the pay of its managers, but not its frontline employees. To determine the potential ethical issues, it should first identify the issues involved so that it can gather facts related to those issues. TRUE

TRUE

A common view in today's business climate is that the only responsibility of a business is to its shareholders, so its only purpose is to make a profit.

FALSE

. Tipco Computer Company decided to market its tablet computers to preschoolers, even though the tablets were better suited for much older children. This potentially unethical activity takes place during the control phase of the strategic marketing planning process.

FALSE

Once the marketing strategy is implemented, controls must be in place to be certain that the firm has actually done what it has set out to do.

TRUE

An example in the text describes a campaign by Grey Poupon that involved a Facebook campaign targeted toward people who had "good taste." The campaign was criticized for privacy issues that made it unethical. This occurred during the implementation phase of the strategic marketing planning process.

TRUE

The most basic corporate social responsibility to employees is to ensure the highest pay for the work performed.

FALSE

. Pepsi has cooperated with America on the Move to improve many of its products and their labels, such as reducing the saturated fat in its Frito-Lay Ruffles. This form of social responsibility most directly impacts shareholders.

FALSE

Business ethics and marketing ethics are synonymous terms.

FALSE

. Conscious marketing encompasses all of the following overriding principles except
A. recognition of marketing's greater purpose.
B. recognition of the company's bottom line.
C. consideration of stakeholders and their interdependence
D. the presence of corporate leadership, creating a corporate culture.
E. the understanding that decisions are ethically based.

B: recognition of the company's bottom line.

Business ethics is concerned with all of the following except
A. distinguishing between right and wrong actions in a business setting. B. distinguishing between right and wrong decisions that arise in a business setting.
C. any special duties or obligations that apply to persons engaged in commerce.
D. broad and well-established moral and ethical principles that might arise in a business setting.
E. societal issues such as the sale of products or services that may damage the environment

E: societal issues such as the sale of products or services that may damage the environment

. The sale of products that may damage the environment, the use of sweatshop labor, and the marketing of dangerous products are examples of
A. internal, controllable marketing issues.
B. issues that don't even need to be discussed in ethical firms.
C. marketing issues but not ethical issues.
D. marketing ethical issues.
E. ethical issues but not marketing issues.

D: marketing ethical issues.

. When Walmart issued new standards for livestock products that were raised on food without antibiotics or artificial growth hormones, it considered multiple ______, including the ranchers that supply the food, its customers, and animal welfare groups.
A. stakeholders
B. investors
C. marketing executives
D. bankers
E. corporate shareholders

A: stakeholders

All of the following are included in the decision-making metric except A. the publicity test.
B. the likability test.
C. the moral mentor test.
D. the transparency test.
E. the admired observer test.

B: the likability test.

____________ provides a detailed, multipronged "Statement of Ethics" that can serve as a foundation for marketers.
A. Johnson & Johnson
B. The American Marketing Association
C. The Better Business Bureau
D. A group of well-respected marketing executives
E. The Advertising Association of America

B: The American Marketing Association

. In the ethical decision-making metric, the question that asks "Would I want the person I admire most to see me doing this?" applies to the
A. publicity test.
B. admired observer test.
C. moral mentor test.
D. transparency test. E. person in the mirror test.

B: admired observer test

The _________ for natural skin care company Burt's Bees is to "create natural, Earth-friendly personal care products formulated to help you maximize your well-being and that of the world around you."
A. mission statement.
B. market analysis
C. company description
D. financial plan E. executive summary

A: mission statement.

. In the ___________ stage, a firm will decide what level of commitment to its ethical policies and standards it is willing to declare publicly and how the firm plans to balance the needs of its various stakeholders.
A. brainstorming
B. implementation
C. planning
D. control
E. evaluation

C: planning

Which of the following statements regarding corporate social responsibility is true?
A. It incorporates higher purpose and a caring culture.
B. It takes a holistic, ecosystem view of business as a complex adaptive system.
C. It understands that decisions are ethically based.
D. Social responsibility is at the core of the business through the higher purpose and viewing the community and the environment as stakeholders.
E. It sees limited overlap between the business and society, and between business and the planet.

E: It sees limited overlap between the business and society, and between business and the planet.

Which of the following statements regarding conscious marketing is correct?
A. It recognizes that business is a subset of society, and that society is a subset of the planet.
B. It sees limited overlap between the business and society, and between business and the planet.
C. It is often grafted on to traditional business model, usually as a separate department or part of PR.
D. It reflects a mechanistic view of business.
E. It is independent of corporate purpose or culture.

A: It recognizes that business is a subset of society, and that society is a subset of the planet.

. When marketers work in controversial or polluting industries such as tobacco or fossil fuels, their central activities largely bar them from becoming
A. ethical human beings.
B. conscious marketers.
C. profitable.
D. successful.
E. recognized.

B: conscious marketers.

Which of the following descriptions embodies conscious marketing principles?
A. not socially responsible
B. questionable firm practices, yet donates a lot to the community
C. neither socially nor ethically responsible
D. not involved with the larger community
E. both ethically and socially responsible

E: both ethically and socially responsible

New real estate disclosure regulations require sellers and their agents to tell prospective buyers about any existing problems with the property. Previously, they were expected only to answer buyers' questions. The new regulation addressed the marketing ethics problem of
A. high-pressure sales techniques.
B. deceptive pricing tactics.
C. misrepresentation of company data.
D. misleading advertising.
E. withholding information.

E: withholding information.

When making decisions, managers often have to decide between doing what is beneficial for them (and possibly the firm) in the short run, and doing what is right and beneficial for the firm and for society in the long run. To address this conflict, a firm
A. must evaluate its quarterly profit statement from an ethics standpoint. B. must state its long-term goals in general terms, so as to not interfere with managers' short-term goals.
C. must always put society's needs ahead of the firm's needs.
D. must align the short-term goals of each employee with the long-term, overriding goals of the firm.
E. should adhere rigidly to legal standards in its industry.

D: must align the short-term goals of each employee with the long-term, overriding goals of the firm.

To avoid having ethical situations become problematic for a firm, the short-term goals of each employee must A. be aligned with the long-term goals of the firm.
B. be overridden by the overall goals of the firm.
C. become secondary to the needs of the remaining stakeholders.
D. be reviewed on an annual basis. E. change on a regular basis.

A: be aligned with the long-term goals of the firm.

. Compared to the average company, firms with strong ethical climates tend to
A. employ more business development consultants.
B. offer more goods and services.
C. be more socially responsible. D. invest more in sales training software.
E. have higher turnover.

C: be more socially responsible.

Courses of action such as halting the market research project, making responses anonymous, and instituting training on the AMA Code of Ethics for all researchers would be identified during the __________ stage.
A. planning
B. identification
C. implementation
D. brainstorming
E. evaluation

D: brainstorming

The XYZ firm is in Step 4 of its ethical decision-making process. Executives were asked to take the Publicity test using an ethical-decision making metric. All scores were in the "No" column. What does this mean?
A. The situation is not ethically troubling to the executives.
B. The executives need to step back and reflect on how they wish to proceed.
C. The situation is ethically troubling to the executives.
D. The executives need to retake the test or take the moral mentor test instead.
E. The results are invalid and the executives need to take the transparency test.

C: The situation is ethically troubling to the executives.

. Ironically, while the leaders of Enron Corporation were manipulating the company's finances for their personal benefit, the company was a major donor to Houston area charities. Enron had unethical business practices, but was also A. practicing marketing ethics. B. falsifying the company's finances through charitable donations.
C. creating a local ethical business climate.
D. demonstrating corporate social responsibility.
E. manipulating the public sentiment for its own benefit.

D: demonstrating corporate social responsibility.

The ethical decision-making framework includes all of the following steps except
A. identify issues.
B. promote the firm's corporate social responsibility efforts.
C. gather information and identify stakeholders.
D. brainstorm alternatives.
E. choose a course of action.

B: promote the firm's corporate social responsibility efforts.

Garrett has just purchased a beer distributorship. He wants to increase the visibility of his firm in local markets, but he knows there are a number of regulations and socially accepted practices associated with promoting alcoholic beverages. The first thing Garrett should do is to
A. identify issues that need to be addressed.
B. promote the firm's corporate social responsibility efforts.
C. gather information and identify stakeholders.
D. brainstorm alternatives.
E. choose a course of action.

A: identify issues that need to be addressed.

Hisaoki picks up the local newspaper and reads a stinging letter to the editor criticizing his beverage company for supporting a sporting event for children with disabilities. The letter writer is critical of a banner displayed at the event with the logos of alcoholic beverages and Hisaoki's company name. Hisaoki never considered that this problem might arise. Hisaoki's company failed to
A. identify issues.
B. promote the firm's corporate social responsibility efforts.
C. analyze the needs of the industry.
D. brainstorm and evaluate alternatives.
E. choose a course of action.

A: identify issues.

Many corporations are shifting from defined benefit to defined contribution retirement programs. When considering changes to retirement programs, the primary stakeholders are the
A. shareholders.
B. employees.
C. customers.
D. marketing managers.
E. competition.

B: employees.

When Bernie Ebbers, WorldCom's CEO, was convicted of financial crimes, WorldCom was forced to merge with MCI. One of the ramifications of this merger was the loss of WorldCom's sponsorship of the Sea Pines Heritage PGA golf tournament. The tournament funds the Heritage Foundation, a major community charity. This example illustrates
A. the need to identify issues. B. that the impact of unethical actions can reach far beyond the corporation.
C. that unethical firms cannot be socially responsible.
D. the lack of information needed to make ethical decisions.
E. the questionable advantage of social responsibility.

B: that the impact of unethical actions can reach far beyond the corporation

All of the following statements regarding corporate social responsibility are true except A. firms believe that they have legal and economic duties in addition to responsibilities to society.
B. a firm's responsibilities to society are not associated with the demands, expectations, requirements, and desires of various stakeholders.
C. CSR can be defined as context-specific actions and policies, taking stakeholders' expectations into account, to achieve what is referred to as the triple bottom line.
D. today, virtually all large and well-known companies engage in some form of CSR.
E. CSR actions are voluntary.

B: a firm's responsibilities to society are not associated with the demands, expectations, requirements, and desires of various stakeholders.

The Harvest County School Board is concerned about deteriorating school facilities, combined with a shrinking budget. The board began by studying the issue, and then identified parents, children, teachers, staff, and taxpayers as groups who have a vested interest in the problem. The school board has listened to each group's concerns. In the ethical decision-making framework, its next action should be to
A. identify issues of concern to lawmakers.
B. assess impact of its actions beyond the classroom.
C. engage in brainstorming alternatives.
D. choose a course of action. E. evaluate the legal ramifications.

C. engage in brainstorming alternatives

After a firm has identified the various stakeholders and their issues and gathered available data related to an ethical decision-making situation, __________ should engage in brainstorming and evaluating alternatives.
A. the senior managers most involved
B. key customers
C. elected officials
D. all parties relevant to the decision
E. any individuals with competing interests

D: all parties relevant to the decision

After a firm has identified the various stakeholders and their issues and gathered available data related to an ethical decision-making situation, all parties relevant to the decision should
A. engage in legal discourse.
B. vote, with the majority deciding the best course of action.
C. reidentify the issues.
D. choose a course of action. E. brainstorm for alternatives.

E: brainstorm for alternatives.

After a firm has identified the various stakeholders and their issues and gathered the available data, all parties relevant to the decision should engage in brainstorming and evaluating alternatives. __________ then review and refine these alternatives, and choose a course of action.
A. Company leaders and managers
B. The firm's lawyers
C. Key customers
D. Community leaders
E. All stakeholders

A: Company leaders and managers

. Darwin's company is facing a difficult ethical issue. The firm has identified the various stakeholders and their issues and gathered the available data. Everyone with an interest in the issue has engaged in brainstorming and evaluating alternatives. Management reviewed and refined the alternatives. It should now choose the course of action that
A. maximizes profits.
B. creates the least possible publicity.
C. involves the fewest employees.
D. minimizes costs.
E. seems best after weighing the concerns of all stakeholders.

E: seems best after weighing the concerns of all stakeholders.

Rock-Bend Company is considering buying out a competing firm and closing most of the competitor's factories. The firm has identified the various stakeholders and their issues and gathered the available data. Everyone with an interest in the issue has engaged in brainstorming and evaluating alternatives. Management reviewed and refined the alternatives, and then chose a course of action. If the managers are not confident about the decision, they should
A. lower their offering price for the competing firm.
B. reexamine their alternatives. C. consult customers.
D. trust their instincts and move forward.
E. choose the least risky option.

B: reexamine their alternatives.

Imagine the use (or misuse) of data collected from consumers by a marketing research firm. One of the issues that might arise is the way the data are collected. At what step in the framework for ethical decision making would this issue be identified by tthe marketing research firm?
A. Step 1
B. Step 2
C. Step 3
D. Step 4
E. Step 5

A: Step 1

. Denny is considering the question, "Did our actions have a negative impact on any stakeholder group?" Denny is addressing marketing ethical issues in the __________ phase of the strategic marketing planning process.
A. planning
B. control
C. implementation
D. brainstorming
E. situation analysis

B: control

Every year, General Mills issues a report discussing how the firm has performed against its own standards of conscious marketing. This report is part of General Mills's __________ phase of its strategic marketing planning process.
A. planning
B. implementation
C. control
D. evolution
E. marketing mix

C: control

Charges that firms are using "sweatshop" labor to produce their products are likely to occur during the __________ phase of the strategic marketing planning process.
A. planning
B. implementation
C. control
D. evolution
E. marketing mix

B: implementation

Marketers that include ethical policies and standards in the firm's mission or vision statements are introducing these concepts at which stage of the strategic marketing planning process?
A. implementation phase
B. control phase
C. planning phase
D. evaluation phase
E. idea generation phase

C: planning phase

During the __________ phase of the strategic marketing planning process, marketers utilize systems to check whether each conscious marketing issue raised in earlier phases was addressed. A. implementation
B. control
C. planning
D. assessment
E. social responsibility

B: control

Alicia has been asked to approve a marketing campaign that, although it is not illegal, promotes food products to children. She is concerned that the food products are not particularly nutritious, although they are not as bad for children as some others sold by competitors. By using the ethical decision-making metric, Alicia will
A. ignore the metric as unworkable, since the campaign might pass some of the tests and fail others.
B. consider the profit potential first; then explore the vague tests in the metric.
C. not worry about the children; their parents are likely to make the buying decision, and they should be able to decide for themselves.
D. evaluate the alternative using a series of questions.
E. consult the firm's code of ethics for guidance and leave personal ethical considerations out of the decision-making process.

D: evaluate the alternative using a series of questions.

CSR can be described as context-specific actions and policies, taking stakeholders' expectations into account, to achieve what is referred to as the triple bottom line. The triple bottom line includes ________ performance.
A. economic, social, and environmental
B. economic, social, and political
C. financial, economic, and social
D. social, environmental, and political
E. financial, social, and environmental

A: economic, social, and environmental

When Toyota owners began to report problems with sticking accelerator pedals and nonfunctioning brakes, Toyota at first ignored or rejected the claims. Eventually, the company evaluated the issue and issued a recall. Which of the four steps of the ethical decision-making framework was Toyota performing when it recalled several of its 2007-2010 models?
A. assess risk
B. identify issues
C. gather information and identify stakeholders
D. brainstorm and evaluate alternatives
E. choose a course of action

E: choose a course of action

For every consumer who purchases a pair of TOMS shoes for $55, the company promises that a needy child will receive a pair of shoes. TOMS shoes is actively engaging in
A. corporate social responsibility.
B. business ethics.
C. marketing ethics.
D. environmental marketing.
E. overpricing of its products.

A: corporate social responsibility.

If Melissa decides to sell the best ice cream on earth, and intends to establish a strong ethical climate in her organization, during which phase of the strategic marketing planning process should she introduce ethical considerations?
A. planning
B. implementation
C. control
D. experience
E. ethics

A: planning

Anupam's company manufactures industrial ladders. He is concerned that consumers who do not understand ladder safety will purchase these extra-tall ladders and injure themselves. During which phase of the strategic marketing planning process should this issue be addressed?
A. control
B. planning
C. implementation
D. design
E. ethics

C: implementation

A meat-packing company discovers that six months ago it unknowingly distributed meat from a cloned cow. The firm is unaware of any specific risks to humans consuming the meat; however, some scientists have raised questions, and some consumers are afraid of possible future problems. The meat company has to decide whether or not to make this matter public. How should it begin the process of making an ethical decision?
A. Brainstorm the available alternatives.
B. Ask its managers to vote for or against public disclosure.
C. Let the board of directors decide what to do.
D. Identify the issues raised by the situation.
E. Find out who purchased the meat, and offer them refunds in return for their silence.

D: Identify the issues raised by the situation.

Elena is the CEO of a small manufacturing firm. She is concerned with meeting the investment objectives of the firm's shareholders, and sees no value in corporate social responsibility. Elena's attitude is A. insupportable in the 21st century.
B. consistent with the views of other critics of corporate social responsibility.
C. typical of nearly all manufacturers.
D. a reaction to regulatory directives of the U.S. government.
E. unethical.

B: consistent with the views of other critics of corporate social responsibility

How might a technology company like Appleensure that it behaves in a socially responsible way toward its employees?
A. It can pay at least minimum wage when the law requires it. B. It can adhere to government-mandated safety standards in the workplace.
C. It can ensure that pay practices are fair at all levels of the company.
D. It can ensure that its packaging materials are recyclable.
E. Social responsibility isn't relevant where employees are concerned; they are paid for their work and that's enough.

C: It can ensure that pay practices are fair at all levels of the company.

How might a technology company like Appleensure that it behaves in a socially responsible way toward its customers?
A. It can protect the privacy of personal information collected on its website.
B. It can adhere to government-mandated safety standards in its stores.
C. It can ensure that it pays its employees fairly.
D. It can ensure that its packaging materials are recyclable.
E. Social responsibility isn't relevant where customers are concerned; it has to do with serving society as a whole.

A: It can protect the privacy of personal information collected on its website

How might Starbucks ensure that it behaves in a socially responsible way toward members of its supply chain? A. It can pay its employees minimum wage as required by law.
B. It can use cups made from recycled paper.
C. It can offer healthy drinks and snacks in its stores.
D. It can purchase coffee beans from suppliers who pay coffee growers a fair price.
E. Social responsibility isn't relevant where channel partners are concerned; it has to do with serving society as a whole.

D: It can purchase coffee beans from suppliers who pay coffee growers a fair price.

All of the following terms are generally associated with the definition of corporate social responsibility except
A. voluntary.
B. stakeholders.
C. social impact.
D. environmental impact.
E. profit.

E: profit.

When companies embrace __________, they appeal not only to their shareholders but also to all of their key stakeholders. A. social media
B. conscious marketing
C. CSR
D. profit sharing
E. conscious advertising

B: conscious marketing

For corporate leaders, their firm's ability to ___________ must be of paramount importance. A. balance profits and expenses
B. balance employees' needs with the needs of the environment
C. balance shareholder interests with the needs of society.
D. benefit shareholders only
E. make a profit

C: balance shareholder interests with the needs of society.

All of the following are questions posed in the ethical decision-making metric except A. Would I want to see this action described on the front page of the local paper?
B. Will this action help advance my career?
C. Would the person I admire most engage in this activity?
D. Can I give a clear explanation for my action?
E. Will I be able to look at myself in the mirror and respect what I see?

B: Will this action help advance my career?

. When integrating conscious marketing into a marketing strategy, a key task is to ensure that all managers are evaluated on their actions from a conscious marketing perspective.This action would take place during which stage of the strategic marketing planning process?
A. brainstorming phase
B. planning phase
C. implementation phase
D. control phase
E. revision phase

D: control phase

Burt's Bees mission is to be an "Earth Friendly, Natural Personal Care Company." As part of that mission, Burt's Bees has a "Zero Waste to Landfill" initiative. During which phase of the strategic marketing planning process would this initiative be pursued?

The initiative would need to be discussed during the implementation phase, which is when firms identify potential markets and discuss how to successfully deliver the four Ps.

Identify how a company might evaluate whether or not to support the United Way, a program that collects donations and distributes them to a wide range of charities.

If a company decides to support the United Way, it must ensure that the charities it supports will benefit the firm's various stakeholders identified in Exhibit 4.3 (employees and their families, current and potential customers, partners, competitors, the community, and the environment).

The CEO of your firm, a distributor for a domestic beer manufacturer, has asked you to take on a special project. She has been hearing about a growing trend toward corporate social responsibility, but she wonders if this is a reasonable investment for the firm. Outline the costs and benefits in general terms and draw your own conclusion for her consideration.

A number of options could be considered, but the student should focus on ways in which the distributor could serve the different stakeholders identified in Exhibit 4.3 (employees and their families, current and potential customers, partners, competitors, the community, and the environment). As the company is a beer distributor, the student can bring in issues associated with alcoholic consumption and/or recycling and green marketing considerations.

. Paul wants to work for a firm that demonstrates corporate social responsibility. Draw up a list of questions Paul could use in an interview to determine the level of commitment of potential employers.

The student should include questions addressing the ways in which the firm serves the various stakeholder groups identified in Exhibit 4.3 (employees and their families, current and potential customers, partners, competitors, the community, and the environment).

How would you distinguish a firm that practices corporate social responsibility from one that practices conscious marketing?

Although CSR is an important element of conscious marketing, it is not the same thing. The student should cite examples from Exhibit 4.2: How Conscious Marketing Differs from CSR.

When marketers work in controversial or polluting industries such as tobacco or fossil fuels, their central activities largely bar them from becoming conscious marketers. How might they engage in CSR in an effort to mitigate the damage that their products cause?

When marketers work in controversial or polluting industries such as tobacco or fossil fuels, their central activities largely bar them from becoming conscious marketers. However, they might engage in CSR in an effort to mitigate the damage that their products cause, such as when cigarette companies sponsor public information campaigns or oil companies plant trees to balance out their carbon footprint. In addition, these companies might undertake efforts in other sectors, such as donating time in local communities or guaranteeing fair wages, because they recognize the importance of such socially responsible efforts.

Avoiding a GMO label might help companies sell more of their products. Thus far, many food manufacturers seem to be fighting GMO labeling. However, in 2014 General Mills decided to make some of its products, such as Cheerios, completely free of GMOs, and Whole Foods has committed to issuing labels, by 2018, on all GMO-containing foods it sells. Who are the stakeholders in this situation?

The stakeholders in this situation are diverse—they include farmers, consumers, manufacturing companies, shareholders, retailers, and the environment.

Distinguish between business ethics and marketing ethics.

Business ethics is concerned with distinguishing between right and wrong actions and decisions that arise in a business setting, according to broad and well-established moral and ethical principles that might arise in a business setting, and any special duties or obligations that apply to persons engaged in commerce. Marketing ethics, in contrast, examines ethical situations that are specific to the domain of marketing, including societal, global, or individual consumer issues.

Paulo, owner of a local plumbing repair company, wants to improve his company's reputation for corporate social responsibility. What could Paulo do?

Corporate social responsibility includes a firm's voluntary actions to address ethical, social, and environmental impacts of its business operations and concerns of stakeholders. Answers will vary, but a plumbing repair company could volunteer to help with a Habitat home, assist with community efforts to help poor or elderly homeowners, provide a free seminar on how consumers can avoid being taken advantage of, or offer to replace aging lead pipes in public buildings at cost.

After a series of embarrassing and unprofessional actions by her marketing team, Ming wants to ethically align personal and corporate goals within her firm. What general and specific actions will she need to take?

To align personal and corporate goals, firms need to have a strong ethical climate exemplified by the actions of corporate leaders and filtered through an ethically based corporate culture. There should be explicit rules for governing transactions; these rules should include a code of ethics and a system for rewarding and punishing inappropriate behavior.

. Funeral home businesses have been criticized for accepting payments from medical parts companies for assisting them in finding families who would allow materials to be harvested from deceased family members. Though not illegal, the payments raised ethical questions. How should the funeral industry go about addressing these questions?

• Identify issues: What are the issues? • Gather information and identify stakeholders: How widespread is the practice? Which groups are raising questions? What are their concerns? • Brainstorm and evaluate alternatives: Should the payments be banned? Should they be made known to donating families? Should they be shared with donating families? Other alternatives? • Choose a course of action: Should the choice be industry-wide or left to individual firms?

As stated in your text, conscious marketing encompasses four overriding principles. Which do you feel is the most important, and why?

Answers will vary, but will should include discussion of one of the following principles: recognition of marketing's greater purpose; consideration of stakeholders and their interdependence; the presence of conscious leadership, creating a corporate culture; or the understanding that decisions are ethically based.

Jacinta has just learned that a brand of clothing she has been selling for years in her store is being made by workers in sweatshops, who work under inhumane working conditions and are paid subsistence wages. Which of the questions in the ethical decision-making metric will most likely affect her decision to discontinue the brand?

Answers may vary, but the first test, the Publicity Test—Would I want to see this action that I'm about to take described on the front page of the local paper or in a national magazine?—would likely be important. Any ethical retailer would not want to be publicly associated with selling sweatshop-made products. The Person in the Mirror test could also be important. Could she live with herself making money off sweatshop-made products? The Transparency Test could also affect her decision. Could she justify not taking the brand off her shelves given the information she has received?

Describe how Walmart engages in CSR efforts to mitigate the criticism it receives for being the worst-paying company in the United States.

The retail giant has been widely criticized as the worst-paying company in the United States. Yet it also engages in extensive CSR programs across the triple bottom line. It has committed to reducing its carbon footprint (environmental performance), donates more than $1 billion in cash and in-kind items to charitable causes per year (social performance), and still earns strong profits (economic performance).

Describe three ways in which corporate social responsibility differs from conscious marketing.

Answers will vary, but student responses should include information from Exhibit 4.2: How Conscious Marketing Differs from CSR.

What is the difference between government regulation of business and corporate social responsibility?

Corporate social responsibility is a set of voluntary efforts not required by law.

During which phase(s) of the strategic marketing planning process are issues related to conscious marketing likely to be addressed?

In their constant pursuit of conscious marketing, firms can address relevant questions at each stage of the strategic marketing planning process.

A local deli has decided that it wants to become more socially responsible. For three of the stakeholder groups listed in the chapter, suggest socially responsible actions the deli could take to serve those stakeholders.

Answers will vary depending on the stakeholders selected for the answer. Some examples:

Describe the four steps in the ethical decision-making framework and include some questions that should be asked in each step.

1. Identify issues: What are the issues? 2. Gather information and identify stakeholders: How widespread is the practice? Who are the stakeholders? Which groups are raising questions? What are their concerns? 3. Brainstorm and evaluate alternatives: What are the possible courses of action? 4. Choose a course of action: What are the advantages and disadvantages of each alternative course of action? What potential legal issues may be involved? Does the decision being made meet the stated decision-making criteria? What are the ethical issues?

Name at least two examples of socially responsible behavior that you have witnessed in a company or heard about through the media. How do these instances meet the criteria for socially responsible behavior as outlined in the text?

Answers will vary, but should focus on the definition of corporate social responsibility.

Briefly describe the three phases of the strategic marketing planning process and give one example of an ethical dilemma that might arise during each phase.

Answers will vary, but must list the planning, implementation, and control phases of the strategic marketing planning process and an appropriate example for each phase.

Briefly describe how CSR affects the various stakeholder categories.

• Employees: Perhaps the most basic corporate social responsibility to employees is to ensure a safe working environment, free of threats to their physical safety, health, or well-being. In addition, firms are focusing their efforts on outreach programs aimed at their employees' families. • Customers: Firms must respect and protect privacy in an electronic world and ensure the healthiness of products, especially those aimed at children. • Marketplace: When one firm in the industry leads the way toward CSR, its partners and competitors often have no choice but to follow—or run the risk of not doing business or being left behind. The initiating firm enjoys an advantage by gaining a reputation for being on the cutting edge of CSR efforts. • Society: This is when firms expend time and energy engaging in activities aimed at improving the overall community and the physical environment.

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. The purpose of conscious marketing is to make a product by selling products and services.

FALSE

. Marketing ethics is concerned with distinguishing between right and wrong actions and decisions that arise in a business setting, according to broad and well-established moral and ethical principles that might arise in a business setting, and any special duties or obligations that apply to persons engaged in commerce.

FALSE

Marketing ethics can involve societal issues such as the sale of products or services that may damage the environment or global issues such as the use of child labor.

TRUE

The consideration of stakeholders and their interdependence is one of the four overriding principles of conscious marketing.

TRUE

. Key corporate social responsibility (CSR) stakeholders include employees, customers, the marketplace, and society.

TRUE

When Walmart pressured its vendors to supply it with environmentally friendly merchandise with labels to prove it, this most relates to the concept of sustainability.

TRUE

One way in which conscious marketing differs from corporate social responsibility (CSR) is that CSR takes a holistic, ecosystem view of business as a complex, adaptive system.

FALSE

From a conscious marketing perspective, social responsibility is at the core of the business through the higher purpose and viewing the community and the environment as stakeholders.

TRUE

Coca-Cola spent $102 million through The Coca-Cola Campaign focusing on water stewardship, healthy and active lifestyles, community recycling, and education. This is an illustration of a CSR program.

TRUE

The first step in ethical decision making is to gather information and identify stakeholders.

FALSE

The Golden Rule test asks the question, "Would I like to be on the receiving end of this action and all its potential consequences?"

TRUE

A roofing company agreed to complete a job in one week and collected a 50 percent deposit, but never showed up to do the job. The same roofing company then donated $6,000 to a local children’s hospital. The roofing company could be considered socially responsible.

TRUE

BlendMate, a firm that manufactures high-end blenders, donates $10 per blender sold to a local food bank. This is a form of corporate social responsibility.

TRUE

Ethos Water donates 2 percent of its profits to children in need of clean water. This action demonstrates that Ethos Water is a firm with a strong ethical climate.

FALSE

Corporate social responsibility refers to the coordinated actions of government organizations to address the ethical, social, and environmental impacts of business operations.

FALSE

Among the key differences between conscious marketing and CSR is the unique view on shareholders that is absolutely critical to CSR.

FALSE

Stakeholders typically include the firm’s employees and their families, customer groups, members of the community, the environment, and the firm’s partners and competitors.

TRUE

Brainstorming in the ethical decision-making framework occurs immediately following the identification of issues.

FALSE

Badger Hardware was planning on raising the pay of its managers, but not its frontline employees. To determine the potential ethical issues, it should first identify the issues involved so that it can gather facts related to those issues. TRUE

TRUE

A common view in today’s business climate is that the only responsibility of a business is to its shareholders, so its only purpose is to make a profit.

FALSE

. Tipco Computer Company decided to market its tablet computers to preschoolers, even though the tablets were better suited for much older children. This potentially unethical activity takes place during the control phase of the strategic marketing planning process.

FALSE

Once the marketing strategy is implemented, controls must be in place to be certain that the firm has actually done what it has set out to do.

TRUE

An example in the text describes a campaign by Grey Poupon that involved a Facebook campaign targeted toward people who had "good taste." The campaign was criticized for privacy issues that made it unethical. This occurred during the implementation phase of the strategic marketing planning process.

TRUE

The most basic corporate social responsibility to employees is to ensure the highest pay for the work performed.

FALSE

. Pepsi has cooperated with America on the Move to improve many of its products and their labels, such as reducing the saturated fat in its Frito-Lay Ruffles. This form of social responsibility most directly impacts shareholders.

FALSE

Business ethics and marketing ethics are synonymous terms.

FALSE

. Conscious marketing encompasses all of the following overriding principles except
A. recognition of marketing’s greater purpose.
B. recognition of the company’s bottom line.
C. consideration of stakeholders and their interdependence
D. the presence of corporate leadership, creating a corporate culture.
E. the understanding that decisions are ethically based.

B: recognition of the company’s bottom line.

Business ethics is concerned with all of the following except
A. distinguishing between right and wrong actions in a business setting. B. distinguishing between right and wrong decisions that arise in a business setting.
C. any special duties or obligations that apply to persons engaged in commerce.
D. broad and well-established moral and ethical principles that might arise in a business setting.
E. societal issues such as the sale of products or services that may damage the environment

E: societal issues such as the sale of products or services that may damage the environment

. The sale of products that may damage the environment, the use of sweatshop labor, and the marketing of dangerous products are examples of
A. internal, controllable marketing issues.
B. issues that don’t even need to be discussed in ethical firms.
C. marketing issues but not ethical issues.
D. marketing ethical issues.
E. ethical issues but not marketing issues.

D: marketing ethical issues.

. When Walmart issued new standards for livestock products that were raised on food without antibiotics or artificial growth hormones, it considered multiple ______, including the ranchers that supply the food, its customers, and animal welfare groups.
A. stakeholders
B. investors
C. marketing executives
D. bankers
E. corporate shareholders

A: stakeholders

All of the following are included in the decision-making metric except A. the publicity test.
B. the likability test.
C. the moral mentor test.
D. the transparency test.
E. the admired observer test.

B: the likability test.

____________ provides a detailed, multipronged "Statement of Ethics" that can serve as a foundation for marketers.
A. Johnson & Johnson
B. The American Marketing Association
C. The Better Business Bureau
D. A group of well-respected marketing executives
E. The Advertising Association of America

B: The American Marketing Association

. In the ethical decision-making metric, the question that asks "Would I want the person I admire most to see me doing this?" applies to the
A. publicity test.
B. admired observer test.
C. moral mentor test.
D. transparency test. E. person in the mirror test.

B: admired observer test

The _________ for natural skin care company Burt’s Bees is to "create natural, Earth-friendly personal care products formulated to help you maximize your well-being and that of the world around you."
A. mission statement.
B. market analysis
C. company description
D. financial plan E. executive summary

A: mission statement.

. In the ___________ stage, a firm will decide what level of commitment to its ethical policies and standards it is willing to declare publicly and how the firm plans to balance the needs of its various stakeholders.
A. brainstorming
B. implementation
C. planning
D. control
E. evaluation

C: planning

Which of the following statements regarding corporate social responsibility is true?
A. It incorporates higher purpose and a caring culture.
B. It takes a holistic, ecosystem view of business as a complex adaptive system.
C. It understands that decisions are ethically based.
D. Social responsibility is at the core of the business through the higher purpose and viewing the community and the environment as stakeholders.
E. It sees limited overlap between the business and society, and between business and the planet.

E: It sees limited overlap between the business and society, and between business and the planet.

Which of the following statements regarding conscious marketing is correct?
A. It recognizes that business is a subset of society, and that society is a subset of the planet.
B. It sees limited overlap between the business and society, and between business and the planet.
C. It is often grafted on to traditional business model, usually as a separate department or part of PR.
D. It reflects a mechanistic view of business.
E. It is independent of corporate purpose or culture.

A: It recognizes that business is a subset of society, and that society is a subset of the planet.

. When marketers work in controversial or polluting industries such as tobacco or fossil fuels, their central activities largely bar them from becoming
A. ethical human beings.
B. conscious marketers.
C. profitable.
D. successful.
E. recognized.

B: conscious marketers.

Which of the following descriptions embodies conscious marketing principles?
A. not socially responsible
B. questionable firm practices, yet donates a lot to the community
C. neither socially nor ethically responsible
D. not involved with the larger community
E. both ethically and socially responsible

E: both ethically and socially responsible

New real estate disclosure regulations require sellers and their agents to tell prospective buyers about any existing problems with the property. Previously, they were expected only to answer buyers’ questions. The new regulation addressed the marketing ethics problem of
A. high-pressure sales techniques.
B. deceptive pricing tactics.
C. misrepresentation of company data.
D. misleading advertising.
E. withholding information.

E: withholding information.

When making decisions, managers often have to decide between doing what is beneficial for them (and possibly the firm) in the short run, and doing what is right and beneficial for the firm and for society in the long run. To address this conflict, a firm
A. must evaluate its quarterly profit statement from an ethics standpoint. B. must state its long-term goals in general terms, so as to not interfere with managers’ short-term goals.
C. must always put society’s needs ahead of the firm’s needs.
D. must align the short-term goals of each employee with the long-term, overriding goals of the firm.
E. should adhere rigidly to legal standards in its industry.

D: must align the short-term goals of each employee with the long-term, overriding goals of the firm.

To avoid having ethical situations become problematic for a firm, the short-term goals of each employee must A. be aligned with the long-term goals of the firm.
B. be overridden by the overall goals of the firm.
C. become secondary to the needs of the remaining stakeholders.
D. be reviewed on an annual basis. E. change on a regular basis.

A: be aligned with the long-term goals of the firm.

. Compared to the average company, firms with strong ethical climates tend to
A. employ more business development consultants.
B. offer more goods and services.
C. be more socially responsible. D. invest more in sales training software.
E. have higher turnover.

C: be more socially responsible.

Courses of action such as halting the market research project, making responses anonymous, and instituting training on the AMA Code of Ethics for all researchers would be identified during the __________ stage.
A. planning
B. identification
C. implementation
D. brainstorming
E. evaluation

D: brainstorming

The XYZ firm is in Step 4 of its ethical decision-making process. Executives were asked to take the Publicity test using an ethical-decision making metric. All scores were in the "No" column. What does this mean?
A. The situation is not ethically troubling to the executives.
B. The executives need to step back and reflect on how they wish to proceed.
C. The situation is ethically troubling to the executives.
D. The executives need to retake the test or take the moral mentor test instead.
E. The results are invalid and the executives need to take the transparency test.

C: The situation is ethically troubling to the executives.

. Ironically, while the leaders of Enron Corporation were manipulating the company’s finances for their personal benefit, the company was a major donor to Houston area charities. Enron had unethical business practices, but was also A. practicing marketing ethics. B. falsifying the company’s finances through charitable donations.
C. creating a local ethical business climate.
D. demonstrating corporate social responsibility.
E. manipulating the public sentiment for its own benefit.

D: demonstrating corporate social responsibility.

The ethical decision-making framework includes all of the following steps except
A. identify issues.
B. promote the firm’s corporate social responsibility efforts.
C. gather information and identify stakeholders.
D. brainstorm alternatives.
E. choose a course of action.

B: promote the firm’s corporate social responsibility efforts.

Garrett has just purchased a beer distributorship. He wants to increase the visibility of his firm in local markets, but he knows there are a number of regulations and socially accepted practices associated with promoting alcoholic beverages. The first thing Garrett should do is to
A. identify issues that need to be addressed.
B. promote the firm’s corporate social responsibility efforts.
C. gather information and identify stakeholders.
D. brainstorm alternatives.
E. choose a course of action.

A: identify issues that need to be addressed.

Hisaoki picks up the local newspaper and reads a stinging letter to the editor criticizing his beverage company for supporting a sporting event for children with disabilities. The letter writer is critical of a banner displayed at the event with the logos of alcoholic beverages and Hisaoki’s company name. Hisaoki never considered that this problem might arise. Hisaoki’s company failed to
A. identify issues.
B. promote the firm’s corporate social responsibility efforts.
C. analyze the needs of the industry.
D. brainstorm and evaluate alternatives.
E. choose a course of action.

A: identify issues.

Many corporations are shifting from defined benefit to defined contribution retirement programs. When considering changes to retirement programs, the primary stakeholders are the
A. shareholders.
B. employees.
C. customers.
D. marketing managers.
E. competition.

B: employees.

When Bernie Ebbers, WorldCom’s CEO, was convicted of financial crimes, WorldCom was forced to merge with MCI. One of the ramifications of this merger was the loss of WorldCom’s sponsorship of the Sea Pines Heritage PGA golf tournament. The tournament funds the Heritage Foundation, a major community charity. This example illustrates
A. the need to identify issues. B. that the impact of unethical actions can reach far beyond the corporation.
C. that unethical firms cannot be socially responsible.
D. the lack of information needed to make ethical decisions.
E. the questionable advantage of social responsibility.

B: that the impact of unethical actions can reach far beyond the corporation

All of the following statements regarding corporate social responsibility are true except A. firms believe that they have legal and economic duties in addition to responsibilities to society.
B. a firm’s responsibilities to society are not associated with the demands, expectations, requirements, and desires of various stakeholders.
C. CSR can be defined as context-specific actions and policies, taking stakeholders’ expectations into account, to achieve what is referred to as the triple bottom line.
D. today, virtually all large and well-known companies engage in some form of CSR.
E. CSR actions are voluntary.

B: a firm’s responsibilities to society are not associated with the demands, expectations, requirements, and desires of various stakeholders.

The Harvest County School Board is concerned about deteriorating school facilities, combined with a shrinking budget. The board began by studying the issue, and then identified parents, children, teachers, staff, and taxpayers as groups who have a vested interest in the problem. The school board has listened to each group’s concerns. In the ethical decision-making framework, its next action should be to
A. identify issues of concern to lawmakers.
B. assess impact of its actions beyond the classroom.
C. engage in brainstorming alternatives.
D. choose a course of action. E. evaluate the legal ramifications.

C. engage in brainstorming alternatives

After a firm has identified the various stakeholders and their issues and gathered available data related to an ethical decision-making situation, __________ should engage in brainstorming and evaluating alternatives.
A. the senior managers most involved
B. key customers
C. elected officials
D. all parties relevant to the decision
E. any individuals with competing interests

D: all parties relevant to the decision

After a firm has identified the various stakeholders and their issues and gathered available data related to an ethical decision-making situation, all parties relevant to the decision should
A. engage in legal discourse.
B. vote, with the majority deciding the best course of action.
C. reidentify the issues.
D. choose a course of action. E. brainstorm for alternatives.

E: brainstorm for alternatives.

After a firm has identified the various stakeholders and their issues and gathered the available data, all parties relevant to the decision should engage in brainstorming and evaluating alternatives. __________ then review and refine these alternatives, and choose a course of action.
A. Company leaders and managers
B. The firm’s lawyers
C. Key customers
D. Community leaders
E. All stakeholders

A: Company leaders and managers

. Darwin’s company is facing a difficult ethical issue. The firm has identified the various stakeholders and their issues and gathered the available data. Everyone with an interest in the issue has engaged in brainstorming and evaluating alternatives. Management reviewed and refined the alternatives. It should now choose the course of action that
A. maximizes profits.
B. creates the least possible publicity.
C. involves the fewest employees.
D. minimizes costs.
E. seems best after weighing the concerns of all stakeholders.

E: seems best after weighing the concerns of all stakeholders.

Rock-Bend Company is considering buying out a competing firm and closing most of the competitor’s factories. The firm has identified the various stakeholders and their issues and gathered the available data. Everyone with an interest in the issue has engaged in brainstorming and evaluating alternatives. Management reviewed and refined the alternatives, and then chose a course of action. If the managers are not confident about the decision, they should
A. lower their offering price for the competing firm.
B. reexamine their alternatives. C. consult customers.
D. trust their instincts and move forward.
E. choose the least risky option.

B: reexamine their alternatives.

Imagine the use (or misuse) of data collected from consumers by a marketing research firm. One of the issues that might arise is the way the data are collected. At what step in the framework for ethical decision making would this issue be identified by tthe marketing research firm?
A. Step 1
B. Step 2
C. Step 3
D. Step 4
E. Step 5

A: Step 1

. Denny is considering the question, "Did our actions have a negative impact on any stakeholder group?" Denny is addressing marketing ethical issues in the __________ phase of the strategic marketing planning process.
A. planning
B. control
C. implementation
D. brainstorming
E. situation analysis

B: control

Every year, General Mills issues a report discussing how the firm has performed against its own standards of conscious marketing. This report is part of General Mills’s __________ phase of its strategic marketing planning process.
A. planning
B. implementation
C. control
D. evolution
E. marketing mix

C: control

Charges that firms are using "sweatshop" labor to produce their products are likely to occur during the __________ phase of the strategic marketing planning process.
A. planning
B. implementation
C. control
D. evolution
E. marketing mix

B: implementation

Marketers that include ethical policies and standards in the firm’s mission or vision statements are introducing these concepts at which stage of the strategic marketing planning process?
A. implementation phase
B. control phase
C. planning phase
D. evaluation phase
E. idea generation phase

C: planning phase

During the __________ phase of the strategic marketing planning process, marketers utilize systems to check whether each conscious marketing issue raised in earlier phases was addressed. A. implementation
B. control
C. planning
D. assessment
E. social responsibility

B: control

Alicia has been asked to approve a marketing campaign that, although it is not illegal, promotes food products to children. She is concerned that the food products are not particularly nutritious, although they are not as bad for children as some others sold by competitors. By using the ethical decision-making metric, Alicia will
A. ignore the metric as unworkable, since the campaign might pass some of the tests and fail others.
B. consider the profit potential first; then explore the vague tests in the metric.
C. not worry about the children; their parents are likely to make the buying decision, and they should be able to decide for themselves.
D. evaluate the alternative using a series of questions.
E. consult the firm’s code of ethics for guidance and leave personal ethical considerations out of the decision-making process.

D: evaluate the alternative using a series of questions.

CSR can be described as context-specific actions and policies, taking stakeholders’ expectations into account, to achieve what is referred to as the triple bottom line. The triple bottom line includes ________ performance.
A. economic, social, and environmental
B. economic, social, and political
C. financial, economic, and social
D. social, environmental, and political
E. financial, social, and environmental

A: economic, social, and environmental

When Toyota owners began to report problems with sticking accelerator pedals and nonfunctioning brakes, Toyota at first ignored or rejected the claims. Eventually, the company evaluated the issue and issued a recall. Which of the four steps of the ethical decision-making framework was Toyota performing when it recalled several of its 2007-2010 models?
A. assess risk
B. identify issues
C. gather information and identify stakeholders
D. brainstorm and evaluate alternatives
E. choose a course of action

E: choose a course of action

For every consumer who purchases a pair of TOMS shoes for $55, the company promises that a needy child will receive a pair of shoes. TOMS shoes is actively engaging in
A. corporate social responsibility.
B. business ethics.
C. marketing ethics.
D. environmental marketing.
E. overpricing of its products.

A: corporate social responsibility.

If Melissa decides to sell the best ice cream on earth, and intends to establish a strong ethical climate in her organization, during which phase of the strategic marketing planning process should she introduce ethical considerations?
A. planning
B. implementation
C. control
D. experience
E. ethics

A: planning

Anupam’s company manufactures industrial ladders. He is concerned that consumers who do not understand ladder safety will purchase these extra-tall ladders and injure themselves. During which phase of the strategic marketing planning process should this issue be addressed?
A. control
B. planning
C. implementation
D. design
E. ethics

C: implementation

A meat-packing company discovers that six months ago it unknowingly distributed meat from a cloned cow. The firm is unaware of any specific risks to humans consuming the meat; however, some scientists have raised questions, and some consumers are afraid of possible future problems. The meat company has to decide whether or not to make this matter public. How should it begin the process of making an ethical decision?
A. Brainstorm the available alternatives.
B. Ask its managers to vote for or against public disclosure.
C. Let the board of directors decide what to do.
D. Identify the issues raised by the situation.
E. Find out who purchased the meat, and offer them refunds in return for their silence.

D: Identify the issues raised by the situation.

Elena is the CEO of a small manufacturing firm. She is concerned with meeting the investment objectives of the firm’s shareholders, and sees no value in corporate social responsibility. Elena’s attitude is A. insupportable in the 21st century.
B. consistent with the views of other critics of corporate social responsibility.
C. typical of nearly all manufacturers.
D. a reaction to regulatory directives of the U.S. government.
E. unethical.

B: consistent with the views of other critics of corporate social responsibility

How might a technology company like Appleensure that it behaves in a socially responsible way toward its employees?
A. It can pay at least minimum wage when the law requires it. B. It can adhere to government-mandated safety standards in the workplace.
C. It can ensure that pay practices are fair at all levels of the company.
D. It can ensure that its packaging materials are recyclable.
E. Social responsibility isn’t relevant where employees are concerned; they are paid for their work and that’s enough.

C: It can ensure that pay practices are fair at all levels of the company.

How might a technology company like Appleensure that it behaves in a socially responsible way toward its customers?
A. It can protect the privacy of personal information collected on its website.
B. It can adhere to government-mandated safety standards in its stores.
C. It can ensure that it pays its employees fairly.
D. It can ensure that its packaging materials are recyclable.
E. Social responsibility isn’t relevant where customers are concerned; it has to do with serving society as a whole.

A: It can protect the privacy of personal information collected on its website

How might Starbucks ensure that it behaves in a socially responsible way toward members of its supply chain? A. It can pay its employees minimum wage as required by law.
B. It can use cups made from recycled paper.
C. It can offer healthy drinks and snacks in its stores.
D. It can purchase coffee beans from suppliers who pay coffee growers a fair price.
E. Social responsibility isn’t relevant where channel partners are concerned; it has to do with serving society as a whole.

D: It can purchase coffee beans from suppliers who pay coffee growers a fair price.

All of the following terms are generally associated with the definition of corporate social responsibility except
A. voluntary.
B. stakeholders.
C. social impact.
D. environmental impact.
E. profit.

E: profit.

When companies embrace __________, they appeal not only to their shareholders but also to all of their key stakeholders. A. social media
B. conscious marketing
C. CSR
D. profit sharing
E. conscious advertising

B: conscious marketing

For corporate leaders, their firm’s ability to ___________ must be of paramount importance. A. balance profits and expenses
B. balance employees’ needs with the needs of the environment
C. balance shareholder interests with the needs of society.
D. benefit shareholders only
E. make a profit

C: balance shareholder interests with the needs of society.

All of the following are questions posed in the ethical decision-making metric except A. Would I want to see this action described on the front page of the local paper?
B. Will this action help advance my career?
C. Would the person I admire most engage in this activity?
D. Can I give a clear explanation for my action?
E. Will I be able to look at myself in the mirror and respect what I see?

B: Will this action help advance my career?

. When integrating conscious marketing into a marketing strategy, a key task is to ensure that all managers are evaluated on their actions from a conscious marketing perspective.This action would take place during which stage of the strategic marketing planning process?
A. brainstorming phase
B. planning phase
C. implementation phase
D. control phase
E. revision phase

D: control phase

Burt’s Bees mission is to be an "Earth Friendly, Natural Personal Care Company." As part of that mission, Burt’s Bees has a "Zero Waste to Landfill" initiative. During which phase of the strategic marketing planning process would this initiative be pursued?

The initiative would need to be discussed during the implementation phase, which is when firms identify potential markets and discuss how to successfully deliver the four Ps.

Identify how a company might evaluate whether or not to support the United Way, a program that collects donations and distributes them to a wide range of charities.

If a company decides to support the United Way, it must ensure that the charities it supports will benefit the firm’s various stakeholders identified in Exhibit 4.3 (employees and their families, current and potential customers, partners, competitors, the community, and the environment).

The CEO of your firm, a distributor for a domestic beer manufacturer, has asked you to take on a special project. She has been hearing about a growing trend toward corporate social responsibility, but she wonders if this is a reasonable investment for the firm. Outline the costs and benefits in general terms and draw your own conclusion for her consideration.

A number of options could be considered, but the student should focus on ways in which the distributor could serve the different stakeholders identified in Exhibit 4.3 (employees and their families, current and potential customers, partners, competitors, the community, and the environment). As the company is a beer distributor, the student can bring in issues associated with alcoholic consumption and/or recycling and green marketing considerations.

. Paul wants to work for a firm that demonstrates corporate social responsibility. Draw up a list of questions Paul could use in an interview to determine the level of commitment of potential employers.

The student should include questions addressing the ways in which the firm serves the various stakeholder groups identified in Exhibit 4.3 (employees and their families, current and potential customers, partners, competitors, the community, and the environment).

How would you distinguish a firm that practices corporate social responsibility from one that practices conscious marketing?

Although CSR is an important element of conscious marketing, it is not the same thing. The student should cite examples from Exhibit 4.2: How Conscious Marketing Differs from CSR.

When marketers work in controversial or polluting industries such as tobacco or fossil fuels, their central activities largely bar them from becoming conscious marketers. How might they engage in CSR in an effort to mitigate the damage that their products cause?

When marketers work in controversial or polluting industries such as tobacco or fossil fuels, their central activities largely bar them from becoming conscious marketers. However, they might engage in CSR in an effort to mitigate the damage that their products cause, such as when cigarette companies sponsor public information campaigns or oil companies plant trees to balance out their carbon footprint. In addition, these companies might undertake efforts in other sectors, such as donating time in local communities or guaranteeing fair wages, because they recognize the importance of such socially responsible efforts.

Avoiding a GMO label might help companies sell more of their products. Thus far, many food manufacturers seem to be fighting GMO labeling. However, in 2014 General Mills decided to make some of its products, such as Cheerios, completely free of GMOs, and Whole Foods has committed to issuing labels, by 2018, on all GMO-containing foods it sells. Who are the stakeholders in this situation?

The stakeholders in this situation are diverse—they include farmers, consumers, manufacturing companies, shareholders, retailers, and the environment.

Distinguish between business ethics and marketing ethics.

Business ethics is concerned with distinguishing between right and wrong actions and decisions that arise in a business setting, according to broad and well-established moral and ethical principles that might arise in a business setting, and any special duties or obligations that apply to persons engaged in commerce. Marketing ethics, in contrast, examines ethical situations that are specific to the domain of marketing, including societal, global, or individual consumer issues.

Paulo, owner of a local plumbing repair company, wants to improve his company’s reputation for corporate social responsibility. What could Paulo do?

Corporate social responsibility includes a firm’s voluntary actions to address ethical, social, and environmental impacts of its business operations and concerns of stakeholders. Answers will vary, but a plumbing repair company could volunteer to help with a Habitat home, assist with community efforts to help poor or elderly homeowners, provide a free seminar on how consumers can avoid being taken advantage of, or offer to replace aging lead pipes in public buildings at cost.

After a series of embarrassing and unprofessional actions by her marketing team, Ming wants to ethically align personal and corporate goals within her firm. What general and specific actions will she need to take?

To align personal and corporate goals, firms need to have a strong ethical climate exemplified by the actions of corporate leaders and filtered through an ethically based corporate culture. There should be explicit rules for governing transactions; these rules should include a code of ethics and a system for rewarding and punishing inappropriate behavior.

. Funeral home businesses have been criticized for accepting payments from medical parts companies for assisting them in finding families who would allow materials to be harvested from deceased family members. Though not illegal, the payments raised ethical questions. How should the funeral industry go about addressing these questions?

• Identify issues: What are the issues? • Gather information and identify stakeholders: How widespread is the practice? Which groups are raising questions? What are their concerns? • Brainstorm and evaluate alternatives: Should the payments be banned? Should they be made known to donating families? Should they be shared with donating families? Other alternatives? • Choose a course of action: Should the choice be industry-wide or left to individual firms?

As stated in your text, conscious marketing encompasses four overriding principles. Which do you feel is the most important, and why?

Answers will vary, but will should include discussion of one of the following principles: recognition of marketing’s greater purpose; consideration of stakeholders and their interdependence; the presence of conscious leadership, creating a corporate culture; or the understanding that decisions are ethically based.

Jacinta has just learned that a brand of clothing she has been selling for years in her store is being made by workers in sweatshops, who work under inhumane working conditions and are paid subsistence wages. Which of the questions in the ethical decision-making metric will most likely affect her decision to discontinue the brand?

Answers may vary, but the first test, the Publicity Test—Would I want to see this action that I’m about to take described on the front page of the local paper or in a national magazine?—would likely be important. Any ethical retailer would not want to be publicly associated with selling sweatshop-made products. The Person in the Mirror test could also be important. Could she live with herself making money off sweatshop-made products? The Transparency Test could also affect her decision. Could she justify not taking the brand off her shelves given the information she has received?

Describe how Walmart engages in CSR efforts to mitigate the criticism it receives for being the worst-paying company in the United States.

The retail giant has been widely criticized as the worst-paying company in the United States. Yet it also engages in extensive CSR programs across the triple bottom line. It has committed to reducing its carbon footprint (environmental performance), donates more than $1 billion in cash and in-kind items to charitable causes per year (social performance), and still earns strong profits (economic performance).

Describe three ways in which corporate social responsibility differs from conscious marketing.

Answers will vary, but student responses should include information from Exhibit 4.2: How Conscious Marketing Differs from CSR.

What is the difference between government regulation of business and corporate social responsibility?

Corporate social responsibility is a set of voluntary efforts not required by law.

During which phase(s) of the strategic marketing planning process are issues related to conscious marketing likely to be addressed?

In their constant pursuit of conscious marketing, firms can address relevant questions at each stage of the strategic marketing planning process.

A local deli has decided that it wants to become more socially responsible. For three of the stakeholder groups listed in the chapter, suggest socially responsible actions the deli could take to serve those stakeholders.

Answers will vary depending on the stakeholders selected for the answer. Some examples:

Describe the four steps in the ethical decision-making framework and include some questions that should be asked in each step.

1. Identify issues: What are the issues? 2. Gather information and identify stakeholders: How widespread is the practice? Who are the stakeholders? Which groups are raising questions? What are their concerns? 3. Brainstorm and evaluate alternatives: What are the possible courses of action? 4. Choose a course of action: What are the advantages and disadvantages of each alternative course of action? What potential legal issues may be involved? Does the decision being made meet the stated decision-making criteria? What are the ethical issues?

Name at least two examples of socially responsible behavior that you have witnessed in a company or heard about through the media. How do these instances meet the criteria for socially responsible behavior as outlined in the text?

Answers will vary, but should focus on the definition of corporate social responsibility.

Briefly describe the three phases of the strategic marketing planning process and give one example of an ethical dilemma that might arise during each phase.

Answers will vary, but must list the planning, implementation, and control phases of the strategic marketing planning process and an appropriate example for each phase.

Briefly describe how CSR affects the various stakeholder categories.

• Employees: Perhaps the most basic corporate social responsibility to employees is to ensure a safe working environment, free of threats to their physical safety, health, or well-being. In addition, firms are focusing their efforts on outreach programs aimed at their employees’ families. • Customers: Firms must respect and protect privacy in an electronic world and ensure the healthiness of products, especially those aimed at children. • Marketplace: When one firm in the industry leads the way toward CSR, its partners and competitors often have no choice but to follow—or run the risk of not doing business or being left behind. The initiating firm enjoys an advantage by gaining a reputation for being on the cutting edge of CSR efforts. • Society: This is when firms expend time and energy engaging in activities aimed at improving the overall community and the physical environment.

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