1. CHAPTER 12/13

2. ETHICAL & LEGAL
RESPONSIBILITIES OF SALES
MANAGERS

3. OUTLINE
BUSINESS ETHICS & SALE MANAGEMENT
* Introduction
 Legal-Ethical Confusion
 Pressure to Compromise Personal Ethics
 Problem of Determining Ethical Standards
 Ethical Situation Facing Salespeople/Sales Executive
 Establish an Ethical Climate
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4. INTRODUCTION
1. I have solid, well-considered ethical beliefs that
can be altered only by reasoned arguments or new
evidence.”
2. “I have character and integrity that will carry me
though when I face difficult moral choices.”
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5. INTRODUCTION
Definition of Ethics:
‘Moral principles or practices’
‘Professional standards of conduct’
‘Set of belief about what is right and what is wrong’
‘ The science of moral duty ’ or ‘ the science of ideal human
character ‘ (Webster College Dictionary)
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6. INTRODUCTION
How does ethics & social
responsibility
differs or is it the same?

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8. INTRODUCTION
Probably the strongest finding from the last decade’s research
in behavioral ethics is that people simultaneously think of themselves
as good people yet frequently lie and cheat (typically in a minor way).
Is this consistent with your experience?
Do you agree or disagree with the following statements from
researchers in the field?
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9. INTRODUCTION
Social responsibility
An ethical theory in which individuals are accountable
for fulfilling their civic duty, and the actions of an
individual must benefit the whole of society.
In this way, there must be a balance between economic growth
and the welfare of society and the environment.
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10. INTRODUCTION
A customer asking for information about one of
their competitors, who happens to be one of your
customers.
Deciding how much to spend on holiday season
gifts for your customers.
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11. INTRODUCTION
A buyer asking for something special, which you
could easily provide, but aren’t supposed to give
away
Deciding to play golf on a nice day, since no one
knows if you are actually at work or not
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13. 13
Legal-Ethical Confusion
 Price discrimination,
bribes, insider trading,
conflict of interest
- These practices maybe
unethical but more
important - they are
illegal

14.  To some people because something is illegal does
not mean it is unethical
 Need to understand that the law cannot possibly
cover & regulate all aspects of life – nor should it
attempt to do so
 It is essential to understand the need for a personal
code of conduct
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15. Pressure to Compromise
Personal Ethics
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16. • Most of us has our own personal code of
ethics – what we will and will not do
• What happen if you are being pressed
sufficiently hard, do you bend your ethical
codes?
• It is easy to be ethical when no hardship is
involved..
• Example??
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For executives who
ignore the unethical
activities of their reps,
the consequences are
serious – e.g
Lawsuits, fines, ruined
careers &
imprisonment to
name a few

18.  Most of us believe we act ethically by our
own standards
 However, ethical standards are set by a
group or a society, not by individuals
 Thus, the group/society evaluates what you
as an individual think is ethical
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19.  Most empirical research indicates that religiosity is
not a significant factor in ethical behavior.
 Atheists and religious people tend to say that the
same actions are ethical and unethical.
 Have you known good people to do bad things?
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Problem of Determining
Ethical Standards

21.  Most of us believe we act ethically by our own
standards
 However, ethical standards are set by a group or a
society, not by individuals
 Thus, the group/society evaluates what you as an
individual think is ethical
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22. Ethical Situations Facing
Salespeople

23.  Relations with the
sales force
 Relations with the
company
 Relations with
customers
- information
- gifts
- entertainment
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24. Establish An Ethical
Climate
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25. What is ethical climate?
 One in which the employees of the
organization believe that typical
organizational practices and procedures
are ethical
 Important for company/organization to
establish an ethical climate
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• Take a Long-Run Point of View
• Put guidelines in writing
• Reinforce the ethical climate
• Provide ethical training

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 Salespeople are, for the most part, caring, ethical
professionals.
 They do face unique ethical challenges because of
their job, including how to handle unethical
requests from customers and making sure that
they know and follow all company policies for
interacting with customers
Conclusion

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 Sales managers have all the usual management
concerns, such as fair hiring practices.
 According to the Federal Sentencing Guidelines,
managers also have to develop policies and
practices that codify ethical behaviors, train
salespeople on the ethics policies, and ensure
that the policies are followed.

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