Ethical Behaviour and Theories 2
Ethical Codes 3
Ethical Dilemmas of Nestle 3
Infant Formula: 3
Overcharged Prices 4
Unfair Labour Practices 4
Steps Taken by Nestle 5
Marketing ethics can be considered as a subset of business ethics which deals with the study of how ethical and moral standards can be applied to various marketing decisions. Various topics can come under the umbrella of marketing ethics and these are product safety, pricing fairness, advertising honesty, product liability, etc. Corporations have increasingly become very competitive and in the last few years, news of breach of ethical codes ...view middle of the document...
For instance, in case when the teleology with regard to an individual is to be happy only or successful, in that case the teleology of an organization is to earn revenues and profit (Hunt, et al., 1989). Based on this assumption, organizations’ basic responsibility is towards its shareholders. One of the contradictions of the amoral business organization myth is that in cases when cost of repairing the social or environmental damage is caused while generating profits, then the overall utility provided to the shareholders may come to be negative.
In order to monitor, standardize as well as control the ethical risks with regard to a business is to establish codes of ethics. For instance, the Standards of Professional Conduct detail instances in which a firm can address its ethical dilemmas (Jones, 1991). Ethical codes also face many risks, one of which is to become too rigid or legalistic. Thus, it is important to understand that different theories contain ethical codes in them as well. For instance, the utilitarian theory suggests that there is an ideal ethical code which can be implemented in any kind of business related decision making. Utilitarianism can be considered as subjective where the rigidity of the codes can render them to be less effective. This difficulty has allowed for the creation of another ethical theory which is named as egoism based on which, it is allowed that organizations can act in a manner wherein it is considered best to serve themselves (Jones, et al., 2007). However, with a fine line being created in following ethics, marketers often face ethical dilemmas and two of them are discussed in the following sections.
Ethical Dilemmas of Nestle
Infant Formula: Nestle got itself involved in a controversy surrounding an infant formula as it was criticised for following practices considered as unethical which endangered human life and health. Various agencies called for the boycott of the company until in the 80s, Nestle agreed to integrate the infant formula marketing code as designed by the World Health Organization. The criticism came in the wake of an understanding which believed that Nestle used genetically modified ingredients in the making of infant food products (Solomon, 1981). It was also accused of dumping its products in Asia which were rejected in Europe since laws related to genetically modified ingredients was not followed strictly in these countries. As per Kant, the decision makers of the company had to be willing enough in order to market the product even if they were assumed to be the uninformed consumers. Therefore, it can argued that by compromising with the product safety and ill informing consumer, Nestle followed an unethical path (The Guardian, 2013).
Overcharged Prices: Nestle was criticised for another issues – that of overcharging the consumers. When the firm launched its bottled water, “Pure life” in select Asian cities, its pricing was done keeping in mind only the...