M: Marketing, 6e (Grewal)
Chapter 4 Conscious Marketing, Corporate Social Responsibility, and Ethics
1) Conscious marketing is governed by four overriding principles that guide a firm’s economic
value creation.
2) Marketing ethics refers to the moral or ethical dilemmas that might arise in a business setting,
according to various moral and ethical principles that might arise in a business setting, and any
special duties or obligations that apply to persons engaged in commerce.
3) 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.
4) The consideration of stakeholders and their interdependence is one of the four overriding
principles of conscious marketing.
5) Key corporate social responsibility (CSR) stakeholders include employees, customers, society,
and the marketplace.
6) Genetically modified organisms, or GMOs, appear in many of the foods that U.S. consumers
eat daily. Many consumers, concerned about the negative health effects of GMOs, wish to know
which foods contain them. Although GMO labeling is a federal requirement, some firms, such as
Whole Foods, have been able to bypass this law in most cases.
7) One way in which corporate social responsibility (CSR) differs from conscious marketing is
that CSR takes a holistic, ecosystem view of business as a complex, adaptive system.
8) From a conscious marketing perspective, social responsibility is at the core of the business
because it advocates a higher purpose that goes beyond making a profit; it also views the
community and the environment as key stakeholders.
9) Walmart engages in CSR programs across its triple bottom line: by committing to reduce its
carbon footprint, donating more than $1 billion in cash and in-kind items to charitable causes per
year, and maintaining strong profits.
10) The first step in ethical decision making is to gather information and identify stakeholders.
11) The Golden Rule test asks the question, “Would I like to be on the receiving end of this
action and all its potential consequences?”
12) 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.
13) 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.
14) 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.
15) Corporate social responsibility refers to the coordinated actions of government organizations
to address the ethical, social, and environmental impacts of business operations.
16) When companies embrace conscious marketing, they appeal only to their shareholders. This
unique view on shareholders is absolutely critical to conscious marketing.
17) Stakeholders typically include corporate shareholders and customers; past, current, and
prospective employees and their families; supply chain partners; government agencies; the
physical environment; and members of the communities in which the firm operates.
18) Brainstorming in the ethical decision-making framework occurs immediately following the
identification of issues.
19) 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.
20) 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.
21) 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.
22) 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.
23) 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.
24) The most basic corporate social responsibility to employees is to ensure the highest pay for
the work performed.
25) 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.
26) Business ethics and marketing ethics are synonymous terms.
27) 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.
28) Business ethics is concerned with all of the following except
A) distinguishing between moral decisions in a business setting.
B) distinguishing between ethical decisions that arise in a business setting.
C) any special duties or obligations that apply to persons engaged in commerce.
D) 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.
29) The sale of environmentally damaging products made by child labor evokes which conscious
marketing principle?
A) recognition of marketing’s greater purpose
B) consideration of stakeholders and their interdependence
C) the presence of conscious leadership
D) the understanding that decisions are ethically based
E) focus on creating a corporate culture
30) 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
31) All of the following tests are included in the ethical decision-making metric except
A) the publicity test.
B) the legality test.
C) the moral mentor test.
D) the transparency test.
E) the admired observer test.
32) ________ provides a detailed, multipronged “Statement of Ethics” that can serve as a
foundation for marketers.
A) Sales and Marketing Executives International
B) The American Marketing Association
C) The Better Business Bureau
D) The eMarketing Association
E) The Advertising Association of America
33) 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.
34) 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
35) 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
36) Which of the following statements differentiates CSR from conscious marketing?
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.
E) It sees limited overlap between the business and society.
37) Which of the following statements differentiates conscious marketing from CSR?
A) It recognizes that business is a subset of society.
B) It sees limited overlap between business and the planet.
C) It is often grafted on to traditional business model.
D) It reflects a mechanistic view of business.
E) It is independent of corporate purpose or culture.
38) When marketers work in controversial or polluting industries such as tobacco or fossil fuels,
their central activities largely bar them from becoming
A) ethical professionals.
B) conscious marketers.
C) profitable.
D) successful.
E) recognized.
39) When a firm embraces conscious marketing
A) its employees act socially responsibly, even if the firm does not.
B) it donates a lot to the community but does not always act ethically.
C) it focuses on selling products and services that make a profit.
D) it maintains its independence from the larger community.
E) its programs are socially responsible, and its employees act ethically responsibly.
40) 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.
41) When making decisions, managers often have to decide between doing what is beneficial for
the firm in the short term, and what is beneficial for both the firm and society in the long term.
To address this conflict, a firm must
A) evaluate its quarterly profit statement from an ethics standpoint.
B) cut back on staff and staff benefits to meet the firm’s immediate, short-term goals.
C) develop a short-terms solution to meet the long-term needs of society.
D) align the short-term goals of each employee with the long-term, overriding goals of the firm.
E) continue to adhere to all the legal standards set forth by the industry.
42) A manager feels confident that earnings will increase in the next few months and therefore
believes it will benefit himself, his branch, his employees, and his shareholders to exaggerate
current earnings just a little. This decision
A) has serious long-term consequences for the firm and does not align with a conscious
marketing approach.
B) carefully considers the overall goals of the firm and reflects a conscious marketing approach.
C) places the needs of its shareholders ahead of the needs of the firm, reflecting a conscious
marketing approach.
D) reflects a careful implementation of the ethical decision-making framework and aligns with a
conscious marketing approach.
E) demonstrates both socially and ethically responsible behavior on the manager’s part.
43) 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.
44) 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
which step of the ethical decision-making process?
A) identify issues
B) gather information and identify stakeholders
C) choose a course of action
D) brainstorm alternatives
E) evaluate the decision
45) 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.
46) Although the leaders of Enron Corporation were manipulating the company’s finances for
their personal benefit, the company continued to be a major donor to Houston area charities.
Enron had unethical business practices,
A) but practiced marketing ethics.
B) and falsified the company’s finances through charitable donations.
C) but created a local ethical business climate.
D) but demonstrated corporate social responsibility.
E) and manipulated the public sentiment for its own benefit.
47) 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.