Chapter Summary

Ethics may be defined as moral standards of behavior. Sales managers and salespeople face many different ethical dilemmas. In the United States, many ethical decisions are actually legal questions. Our system of laws standardizes our interpretation of many ethical situations by making them illegal. However, there are still many situations, not covered by the law, in which ethics becomes an important factor.

It is easy to be ethical when it does not cost you anything—when you are winning. The test comes when things are not going well. Then there may be real pressure to compromise your personal ethics. There is an increasing awareness and concern over ethics in selling. Adherence to ethical standards is becoming increasingly important.

The problem is to determine what the ethical standards are. Society lacks commonly accepted standards of behavior. Ethical considerations are involved in many of the relationships sales executives have with their sales forces, their companies, and their customers. Customer relations, especially involving information, gifts, and entertainment, can have serious ethical overtones.

When setting ethical standards, it is important to take a long-run perspective. One good ethical guideline to follow is to do what you would feel comfortable explaining to your family, your friends, or even to the public at large on television. A company may help establish an ethical climate by taking a long-run perspective on business decisions, by developing a written code of ethics that managers are expected to enforce, by providing ethical role models through management’s words and actions, and by providing ethical training.

Public regulation touches a company’s marketing department more than any other phase of the company’s operations. Both the employee and the company are responsible for compliance with federal regulations. Government regulation has occurred in several areas that affect sales: price discrimination, unfair competition, Green River Ordinances, and cooling-off laws.