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Clarks Shoes UK

Business Ethics Reflective Learning Log

– Marketing and Selling the “Ethical” Shoes –

 

“Being good is good business”

Anita Roddick. The Body Shop

 

For me, the concept of ethics starts with the understanding of morality. Something is ethical if it is moral and good. Now, morality is about right or wrong but the perception of this concept will vary across a spectrum of cultures and individuals.

I am aware of the syntax “business ethics”. To me, it refers to a firm acting morally correct beyond its main goal of making profits.

From personal observations, it is certain that ethics becomes more and more important in the business world. I am still debating to understand if the increased awareness of companies (particularly multinationals) regarding ethical issues come from their inner desire of doing good or because they are concerned with protecting their brand image and/ or are responding to media and pressure groups that are constantly following and exposing the “bad” companies.

I deeply admire firms that are able to create successful businesses based on moral principles, act ethically and be lucrative at the same time. Unfortunately, there are too many companies compromising on stakeholders (the community, customers, employees) when persistently seeking profits for their shareholders.

While it is true that companies such as “The Body Shop” have their whole business model build on ethical principles, there are companies (i.e. in Retail industry, Tabaco industry) that besides their central focus on consumerism and clear profit orientation or simply negative existence, are trying to compensate, engaging in Corporate Social Responsibility activities. Is, thus, CSR: altruism, trend or a long term investment?

Businesses are run by people and therefore they will merely depend (at least at top-management level) of correctness of the individuals involved. I understand that ethics goes beyond law and norms, and that people are found in situations where they need to take difficult decisions. 

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Log entry 2 – Ethical theories

“Ethical theories are the rules and principles that determine 

right and wrong for any given situation”

Crane and Matten (2010, p.92)

I believe it would be easier if the business world would be governed by moral absolutism and “universal notions of right or wrong”. However, studying different philosophical theories, I convinced myself once again that “notions of right or wrong depend on the circumstances” and the people involved. For instance, the case study “Producing Toys – Child’s Play” (Crane and Matten, 2007, cited in Long, 2011) puts the western reader into an unfamiliar context and makes her/ him almost immediately jump and condemn the working conditions of the Thai manufacturer. Further, after accepting that in those particular circumstances it is a normal business practice, the reader moves into discussing the morality (or better said immorality) of the western product manager.

To understand and to logically explain the above example I looked through the lenses of consequentialism and non-consequentialism theories. I believe, initially, I was unintentionally blinded by the western perceptions. In my eyes, while I was entirely aware Thailand has its own culture and pace in the development process, I still took it out of its actual context and mentally placed it somewhere in Europe. Therefore, my (ethnocentric) view was non-consequentialist as I was convinced that the underlying motives of accepting the two-year supply contract are wrong and my argument flown directly to “Universal human/ child rights”.  At the same time, analysing the Thai environment, and considering that the family got the desired outcomes, the situation could be seen as being morally right – would argue consequentialist theories. Now, the so-called “universal” rights appear controversial and maybe not applicable.

Conversely, deontological theory argues that “right and wrong are determined by the motive/ action not outcome” and Kant adds that “the essence of morality is found in human reason as the arbiter of truth”. According to this approach, using children in toys manufacturing will go against Kant’s principles of reversibility and universality. It is true that in Thailand children work together with their parents. On the other hand, the product manager cannot imagine a similar situation happening with his family. Therefore, the principle of reversibility – “do unto others as you would have them expected to do unto you” – fails.

Another noble teaching of Kant, but difficult to find in modern societies, is the “categorical imperative”. It regards consistency, human dignity, and universality but one cannot treat all people equally because life is multifaceted.  Moreover, because the environment is competitive, a person’s desire or pursue of self-interest can be seen as morally right according to Adam Smith which “treats self-interest as the foundation of morality”. Here the simple egoism is enlarged and “include others in the group”: the deal will be sealed as it is seen being beneficial to the whole company. It is true that in any case, if this particular firm will renounce to the partnership with the Thai producer, another one, less or more unscrupulous, will take its place. Yet, not only the current western company will have to lose, also those Thai families will be devoid of their stable income. In this situation, agreeing with utilitarianism it can be said that  action is morally right if it results in the greatest amount of good for the greatest number of people affected by the action” (Crane and Matten, 2010) and “an ethical decision should maximise benefits to the society and minimise harm” (Trevino and Nelson, 2007, p.96).

In the Business Ethics lecture we were presented two views regarding principles of equal human value or worth, as follow:

“Everybody to count as one, nobody to count as more than one” (Bentham, cited by Long, 2011)

“The good of any one individual is of no more importance…than the good of any other” (Sidgwick, cited by Long, 2011)

The two quotations above, in its pure form, has little appliance in today’s business world as the stakeholders’ spectrum has enlarged and it is difficult to satisfy equally all of them.

Moreover, in the case with the toy manufacturer we have apparently a win-win situation if the manager completes the deal. However, “the good” gained by both parties is not equal (or is it?). The product manager family “counts more than one” as it has the advantage of the developed countries, where Thai families are in the situation of accepting “the best worst” of the third world countries. It is a required stage in the development process for a country such as Thailand. This comes in opposition with Kant’s teaching about universality and reversibility as, most probably, the product manager would not want to be on the other side of the story, nor would Kant accept sacrificing Thai children for the (group) self-interest of the family.  Still, let’s bear in mind that “pain and pleasure” is perceived differently by different people and cultures. Also, I agree with the Rule Utilitarianism, in the long run it “produces more pleasure than pain for society”.

I believe a person moral standards will influence ones choice not only in his/ her personal life but also will transfer into professional life. However, people as individuals can be good, but they might be influenced by the working environment. From a personal experience I can say that there is might be danger of people compromising their moral standards in order to complete the job or satisfy the manager.

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Log entry 3 – Critical Incident

– marketing and selling the “ethical” shoes –

I worked for Clarks Shoes as a Sales Assistant for two years.  The company is the leading footwear retailer in the United Kingdom with 550 branches. The company has remained family owned throughout its history, establishing a strong reputation for comfortable adults’ and children’s shoes, and accessories. In addition to selling high quality shoes, Clarks claims to provide exceptional customer service.

Many loyal customers have grown with Clarks shoes themselves, and are now bringing their children for a shoe fit. When entering the children section, it can be observed that the servicescape is carefully organised and various colourful posters are present. Daisy Explorer and Jack Nano are popular characters that can be found in Clarks kids YoToy shoe range (i.e. mini toys hidden in the heel of the shoes, imprinted on the shoes, or simply as a sticker sheet) (Figure 1). In addition, the company developed free interactive, engaging and educational online games (Figure 2).

At first, it appears to be a smart method of providing “comfort and fun” as the company states itself (Clarks Shoes Website, 2012). However, is this strategy a way of delivering more to kids or receiving the most out of their innocence?

I remember a particular situation when I helped a 10 years old girl to find a pair of school shoes. She had clear preference for a pair of shoes with a toy. After 20 minutes of trying several pairs (with and without toys) in the search for the right fit, I could see that the girl would refuse to accept any of the shoes but the one with the Daisy Explorer toy. Initially, the mother was not very excited about the toy shoes and their slightly higher price, but she was influenced by her daughter’s pleading (nagging), and was ready to give in and buy the shoes her daughter desired. In the end, I recommended the “second best fit” with a toy as “the best fit” that corresponded with the requirements of the young customer, and because the mother was inclined to buy something that her daughter will be happy to wear.

That was the moment when I started questioning the ethical aspect of such marketing techniques and wonder whether they could be justified or criticised.

Figure 1: Daisy Explorer and Jack Nano – Clarks Kids YoToy shoes

 

Figure 2: Daisy Explorer and Jack Nano Kids website

 

From my personal perspective, I acknowledged the influence marketing had on the child but could not express my revelation with the family since I was there in the employee role. I did not lie but I did not say the whole truth either. No one got hurt, but it felt wrong to me. At this point Kant would argue that my action was wrong as my underlying motives were wrong because I recognised the situation as being marketing to children which is declared to be unethical due to the involvement of a vulnerable target.

From the sales assistant position, it felt I took the right decision in that particular circumstance. I listened carefully to the customer’s request, was obliged to follow the rules of the training received, and favoured all possible ways of sealing the deal and contributing to company profit. As a result, I pleased the family and contributed to the daily sales targets. The utilitarianism would say I acted morally right because the outcome satisfied all parties involved: the family, the company, and myself.  It is possible that I might be rationalising an unethical behaviour in the name of the “job role”, but in this case I believe that marketers should be made responsible for their actions.

Milton Friedman (1970, cited in Bowie and Duska, 1990, p.23) would argue that:

“there is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits as long as it stays within the rule of the game, which is to say, engages in open and free competition without deception and fraud”.

Accordingly, Clarks – a private company – has the unique aim to seek profits. Now marketer’s role, of developing creative ways of promotion that will encourage sales and rise profits of the company, could be seen as morally justified (Camenisch, 1998). This implies I should have played correctly. Not if I listen to Carr who regards business as a “game” governed by its own rules rather than those of “society” (Ferrell and Fraedric, 1997). Thus, Clarks is entitled to pursue profit making, especially because the mother was the one purchasing the product.

On one hand, the utilitarian argument supporting the company would suggest that promotion of the YoToY range to the kids market might generate utility for the company as well as for its customers: offering quality and comfort of the traditional kids shoes, with the added value of fun. On the other hand, it is possible that the final results do not comply with J. S. Mill’s focus on creating “the greatest good for the greatest number” (cited in Kline, 2005, p. 9), since kids’ cognitive capacities are not fully developed and cannot distinguish between fantasy and reality which makes it easy for marketers to unfairly benefit “of this vulnerability to satisfy their own needs” (Crane and Matten, 2010).

Although it can be claimed that the parents are the ultimate decision makers, I realised that the “advertisers seek to encourage and take advantage of the “pest power” that children have towards their parents” (Crane and Matten, 2010, p. 360). At this instant, agreeing with non-consequentialism theories, it appears that Clarks abuses children’s vulnerability because the underlying motives – exploiting the lack of cognitive skills of a child – are wrong. But how can we make a company responsible if it is not a person and lucks moral traits (The Corporation, 2006)?

Considering that the business and marketing decisions are made by people who possess moral attributes, issues such as fairness and honesty should be brought into discussion.

„Honesty refers to truthfulness, integrity and trustworthiness; fairness in the quality of being just, equitable, and impartial” (Ferrell and Fraedric, 1997, p. 31).

People might be guided by fairness and honesty in their personal life, but does it mean they should renounce on these qualities when crossing into the professional space?  Although Adam Smith and Carr would support those people that in business act in their own self-interest, Ferrell and Fraedric (1997) argue that “ethical business relations should be grounded on fairness, justice and trust”. Besides, it is important not to forget that deontological Kantianism, as well as the theory of Virtues and Justice would not tolerate immoral intentions. Furthermore, DeGeorge (1978, in Chryssides and Kaler, n.d.) teaching demonstrates that business is part of the society and does not support shifting ones moral behaviours.

Ultimately Crane and Matten (2010) argue that the innate duty of a company is to “respect the interest of the customer, as well as” its own interest (p. 360). Advertising and promotion try to persuade people, which agreeing with Mélé (2009) is not wrong, but “under certain circumstances” it can be manipulative “especially when targeting vulnerable audiences” (p.294) – a 10 years old girl, in this case.

If I was to encounter once more a similar situation, I believe my behaviour would be the same, with the exception that I would try not to take into consideration child’s preference for the toy, and explain to the parent the importance of the best fit over fun. From my personal experience, I can say, parents avoid to buy shoes their children do not love as they know the kids will not wear them. In this situation, I tend to agree that:

“If someone chooses to use a product it is because they consider it to be in their own interests. A marketer can no more be held responsible for the aggregate decisions of their actions […]” (Crane and Matten, 2010).

***

Log entry 3 – Reflection

 –

Being a third year Business and Marketing student, and particularly interested in “Corporate Social Responsibility” (CSR), I demonstrated in my first log that I had a good knowledge of the concept of morality, and was familiar with the syntax “Business Ethics” (BE) from the beginning of this module. Yet, I did not have a well-defined understanding of the differences and overlaps between CSR and BE.

I launched the question – is CSR altruism, trend or a long term investment? The answer depends on circumstances and requires a deep analysis to comprehensively answer this question. Still, I would tend to think it is a mixture of those elements. First, it is visibly a trend as one of the main changes in modern marketing is the appearance of Freeman’s stakeholders approach (mentioned in in Kline, 2005, p.14), which must be a responsible one. Second, it is altruism because companies are run by people who are, deep down, no matter what, human beings. Finally, although there is not a clear way of measuring the return on investment (ROI) on CSR, in the long-term, and with the appropriate PR activities, I believe a company could build a strong positive image as a responsible citizen and therefore attract customers, employees and investors.

As the course progressed, I start realising that both – CSR and BE – search for values, goals, and choices beyond Friedman’s argument of sole profit making/ maximisation. More exactly, it can be said that CSR concerns with company’s accountability for all its stakeholders, not only shareholders, while Ethics is looking at moral principles when determining if an actions is right or wrong. Therefore, while Clarks Company is obviously engaging in CSR actions (Clarks Shoes Website, 2012) such as cause-related “Race for Life”, “Soul of Africa”, social marketing “Unicef”, it does not necessarily mean it acts morally right at all times.

Moreover, I was pondering on the underlying reasons which determine a profit seeking company to act ethically, and even to develop CSR programs. As I learnt through the course and developed in my second log, it can be said that I was inclined towards non-consequentialism views, looking for the motives that would justify or criticise the perceived ethical or unethical actions of (multinational) companies.

Additionally, in my second entry, I looked closely at the ethical theories in order to discover relevant arguments for or against the behaviours encountered in the case study “Producing Toys – Child’s Play”, and also within my personal work experience.

Lastly, in my third log, I considered a real life ethical incident. The dilemma I faced rose from C&J Clark’s marketing decision of targeting a vulnerable customer group – children. In that instance I seriously questioned the morality of such strategies and decided to adopt what I perceived as being a fair behaviour for all parties involved. In other words, I took a utilitarian attitude. However, I concluded later that in the eventuality of a similar incident even thought I would follow the pattern, I would improve the information offered to the parent.

Analysing the Clarks ethical dilemma, I discovered my actions could be easily described following the Ethical Decision-Making Process framework offered by Rost (1986, cited in Crane and Matten, 2010) presented in the Figure 3 below:

Figure 3: Ethical Decision-Making Process. Source: Rost, 1986, cited in Crane and Matten, 2010p. 143.

 

1.      First, I presented a real work-related situation in which I found myself while working for Clarks as a sale assistant. I identified the moral issue – marketing to children.

2.      Next, I questioned the morality of using powerful marketing tools on young targets and offered arguments for and against company’s decision.

3.      Following, I found the most reasonable decision – J. S. Mill’s utilitarianism.

4.      Finally, I demonstrated a utilitarian moral behaviour. Also, agreeing with Mélé (2009) I could say it is true that as a sales assistant I felt a tension between the loyalty to my employer and the family I was serving when engaged in the moral behaviour. 

Furthermore, I am wondering if I could use the same framework to identify and examine Clarks ethical decision-making process used in creating marketing strategies.  I tend to ask once again how can we make a company responsible if it is not a person and lucks moral traits, and the most plausible argument would mention (Kline, 2005, p.14) “actors that possess a capability to act”, in other words – company’s employees/ marketers who engaged (or trapped?) the young customers into a fun and learning process aiming to create preferences.

Moreover, I would entirely support Ferrell and Fraedric’ view (1997) that while personal ethics is imperative, it is not enough for a good understanding of organizational situations, because it is also important to recognize the relationship between legal and ethical decisions in business.

Then again, I would like to believe that more and more companies would acknowledge the importance of embedding ethics in the company’s culture starting with the board of directors until the front-line employees (or brand ambassadors).  However, it is naive to expect that the business world could be governed by the moral absolutism and the “universal notions of right or wrong”, due to the extremely diverse social and cultural contexts. Also, I demonstrated (in my second log) that a person’ personal background, perceptions about the world, and ethnocentrism could influence the judgments he/ she makes regarding a specific situation.

At the end of this learning journey, I would like to emphasise that throughout the module of Business Ethics I learnt to identify ethical issues and recognize the approaches available to interpret them. I find these philosophical schemas useful in juggling real world ethical difficulties, as well as an interesting way of comprehending our multifaceted lifes (personal, familial, work, etc). 

***

 

 

References

Achbarm, M., and Abbott, J. (Directors) (2003). The Corporation. [Film] Canada: Big Picture Media Corporation.

Bowie, N. E. and Duska, R. F. (1990). Business Ethics. 2nd ed. USA: Prentice Hall.

Camenisch, P. F. (1998). Marketing Ethics: Some Dimensions of the Challenge. In: Pincus Hartman, L. editor. Perspectives in Business Ethics. Singapore: McGraw-Hill International Editions, pp. 492-496.

Carr, A (1968) „Is Business Bluffing Ethical?”, in An introduction to business ethics Chryssides, G. and Kaler, J., editor (n.d.), pp.50-118. Available from: Blackboard. N.d.:Chapman.

Chryssides, G. and Kaler, J., (n.d). An introduction to business ethics. s.l.:Chapman.

Clarks Shoes Website (2012). [Online] Available at: www.clarks.co.uk [Accessed 5th April 2012].

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Crane, A. and Matten, D. (2010). Business Ethics. 3rd ed. New York: Oxford University Press Inc.

DeGeorge, R. T. (1978). „Moral Issues in Business”, in An introduction to business ethics Chryssides, G. and Kaler, J., editor (n.d.), pp.37-49. Available from: Blackboard. N.d.:Chapman.

Ferrell, O. and Fraedric, J. (1997). Business Ethics: Ethical Decision Making and Cases. 3rd ed. USA: Houghton Mifflin Company.

Klebe Treviño, L. and Nelson, K. A. (2007). Managing business ethics : straight talk about how to do it right. New Jersey: Wiley.

Klebe Treviño, L., and Nelson, K. A. (2007). Managing business ethics: straight talk about how to do it right. New Jersey: Wiley.

Kline, J. M. (2005). Ethics for International Business: Decision Making in a Global Political Economy. Great Britain: Routledge.

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Mélé, D. (2009). Business Ethics Action: Seeking Human Excellence in Organizations. Great Britain: Palgrave Macmillan.

 

Selective Bibliography

Graham, G. (2004). Eight Theories of Ethics. Great Britain: Routledge.

Long, D. (2011). Business Ethics: Consequentialist Theories: Utilitarianism and Egoism, BU04BUSETHICS. Canterbury Christ Church University, 17th October 2012. Available from: Blackboard [Accessed 5th January 2012].

Long, D. (2011). Business Ethics: Deontology, the Ethics of Duty, BU04BUSETHICS. Canterbury Christ Church University, 10th October 2011. Available from: Blackboard [Accessed 5th January 2012].

Long, D. (2011). Business Ethics: Virtues and Justice, BU04BUSETHICS. Canterbury Christ Church University, 28th November 2011. Available from: Blackboard [Accessed 5th January 2012].

Long, D. (2011). Defining Business Ethics: Identifying and Analysing Ethical Arguments, BU04BUSETHICS. Canterbury Christ Church University, 3rd October 2011. Available from: Blackboard [Accessed 6th January 2012].

Michalos, A. C. (1995). A pragmatic Approach to Business ethics. USA: Sage Publications.

Pincus Hartman, L. editor. (1998). Perspectives in Business Ethics. Singapore: McGraw-Hill International Editions.