This paper provides three brief cases of retailers who have, through what is interpreted as stakeholder mismanagement, brought major problems to bear upon those companies, and other stakeholder groups. The main cases examined concern a "free flight" promotion run by the Hoover company in the UK in 1992/3, the collapse of the Ratner'sretail jewellery chain, and wage realignments at British Gas in 1994.Synthesising these examples, it is suggested that: (1) All companies are expected to meet ethical norms in dealings with (...) their stakeholders, regardless of whether or not they have specifically set out to cultivate an "ethical" image; (2) Stakeholder groups tend not to stand in isolation, but to interact; moreover, modern technology may well tend to increase that interaction; (3) The fall-out from stakeholder mismanagement is likely to be widespread, highly publicised, long lasting, and difficult to contain; (4) Prospect Theory, derived from economics and psychology, may be applicable in such cases. This broadly asserts that we are far more readily affected by dissatisfaction than satisfaction, and this is especially so if expectations have been raised. However, from an ethical standpoint, there is still virtue in pursuing high standards in dealings with stakeholders. (shrink)

Although consumers are increasingly engaged with ethical factors when forming opinions about products and making purchase decisions, recent studies have highlighted significant differences between consumers' intentions to consume ethically, and their actual purchase behaviour. This article contributes to an understanding of this 'Ethical Purchasing Gap' through a review of existing literature, and the inductive analysis of focus group discussions. A model is suggested which includes exogenous variables such as moral maturity and age which have been well covered in the literature, (...) together with further impeding factors identified from the focus group discussions. For some consumers, inertia in purchasing behaviour was such that the decision-making process was devoid of ethical considerations. Several consumers manifested their ethical views through post-purchase dissonance and retrospective feelings of guilt. Others displayed a reluctance to consume ethically due to personal constraints, a perceived negative impact on image or quality, or an outright negation of responsibility. Those who expressed a desire to consume ethically often seemed deterred by cynicism, which caused them to question the impact they, as an individual, could achieve. These findings enhance the understanding of ethical consumption decisions and provide a platform for future research in this area. (shrink)

This article presents a qualitative research about the way in which business leaders of a retail company gradually clarify the ethical responsibilities of their company – in an ongoing discussion of particular cases. It is based on 12 years of experience as an external member of the ethics committee. The aim of the article is not so much as to evaluate the different single decisions that were made and implemented to make the company meet high ethical standards, but rather to (...) focus on three issues and on how they relate to each other: (1) the shift from a communitarian Christian set of values to a broader secular framework of basic principles; (2) the way in which business people in a retailing company cope with issues that seem ethically troublesome, when reflected upon from a ethical point of view; and (3) how the process of ethical dialogue has led to a typology of the different levels of responsibility that retailers are willing to attribute to themselves according to the kind of problem at stake. The three issues together illustrate how a company that took the business ethics question head-on systematically moved into a particular ongoing collective learning process. (shrink)

Business Ethics: A European Review, EarlyView.

This paper investigates the relationship between two outcomes of relationship marketing – affective commitment and behavioral loyalty – and consumers' unethical behavior. The main objective of the study is to assess whether affective commitment and behavioral loyalty to a store translate into more ethical behavior towards that store, controlling for the variables of age, gender, and ethical beliefs. The study does not rely on a single measurement tool, but is based on ten months' panel data and three different mail surveys (...) targeted at 359 Belgian households. The results provide support for our hypothesis that affective commitment is indeed negatively correlated with consumers' unethical behavior. The same conclusion could not be drawn for the relationship between behavioral loyalty and consumers' unethical behavior. No significant relationship was detected, not even in situations where affective commitment was high. The results hold major implications for retailing practice. (shrink)

Businesses that maintain ethical standards have an advantage in the marketplace based on the increasing interest of consumers in products that have a social and ethical component. Fair trade organisations that adopt environmental, social and ethical principles in trading are in a good position to make the most of this growing interest in the market. However, it is unclear whether fair trade organisations are taking full advantage of emerging market opportunities for ethically traded products. This research explores this issue by (...) describing the business strategies of three fair trade organisations that import and sell craft goods into Western countries and evaluates them in the context of this growing market. The research findings indicate that in order to remain in business, fair trade craft organisations have had to adopt better business practices in recent years, improving quality, customer service and product offerings to customers. However, growth appears to be limited, as distribution remains focused on a small, niche market. This paper explores the distribution strategies of two fair trade commodity organisations that are successfully reaching a wider customer base, demonstrating that fair trade products have a unique selling advantage in the mainstream marketplace. In conclusion, fair trade craft organisations are not exploiting this market opportunity to the degree they should and will need to explore wider distribution and alternative business strategies to expand their market share. (shrink)