Ethics in Marketing

The American Marketing Association (AMA) Statement of Ethics preamble contains this statement "As marketers, we recognize that we not only serve our organizations but also act as stewards of society in creating, facilitating and executing the transactions that are part of the greater economy. In this role, marketers are expected to embrace the highest professional ethical norms and the ethical values implied by our responsibility toward multiple stakeholders (e.g., customers, employees, investors, peers, channel members, regulators and the host community)."

The statement clearly demonstrates that as marketers, we do not only serve our own organization. but have a responsibility towards numerous other stakeholders listed above. In this regard, we need to treat these stakeholders using the ethical norms expected of marketers. The AMA further discusses the three ethical norms which consist of the following:
1) Do no harm
2) Foster trust in the marketing system
3) Embracing the ethical values of honesty, responsibility, fairness, respect, transparency and citizenship.

An example of a company making unethical marketing claims was seen in the case of Career Education Corporation, a for-profit university that was investigated by the Securities Exchange Commission (SEC) and the California State education oversight bureau for making fraudulent claims back in 2005. These include overstating the income of students who have graduated from its colleges and the number of them who found jobs. Other unethical marketing include overstating the career placement service available to students. In this case, the marketers did not fulfill its responsiblity to multiple stakeholders. The customers (students) were lured into debt with false promises of high potential future income. The employees were hurt when some campuses were closed down. The investors (stockholders) were hurt by the relevation and lost significant value in their investment. Its peer (other for profit universities) were hurt because they had to compete against false marketing by Career Education. Regulars (California bureau) had to get involved to investigate the claims. Lastly, the host community was hurt when mutliple Career Education campuses had to be closed down eventually due to poor profits. The action of Career Education resulted in harm to multiple stakeholders, lack of trust in marketing by for-profit universities and a failure to adhere to ethical values.

http://www.nytimes.com/2005/07/24/business/yourmoney/24gret.html?pagewanted=1&ref=careereducationcorporation