Answer to Question 1
A
Answer to Question 2
The pyramid of social responsibility consists of four dimensions or responsibilities: economic, legal, ethical, and philanthropic. From an economic perspective, all firms must be responsible to all stakeholders for financial success. The economic responsibility of making a profit serves employees and the community at large due to its impact on employment and income levels in the area that the firm calls home.
Marketers also have expectations, at a minimum, to obey laws and regulations. This is a challenge because the legal and regulatory environment is hard to navigate and interpretations of the law change frequently. Economic and legal concerns are the most basic levels of social responsibility for good reason: Without them, the firm may not survive long enough to engage in ethical or philanthropic activities.
At the next level of the pyramid, marketing ethics refers to principles and standards that define acceptable marketing conduct as determined by the public, government regulators, private-interest groups, competitors, and the firm itself. The most basic of these principles have been codified as laws and regulations to induce marketers to conform to society's expectations of conduct. However, it is important to understand that marketing ethics goes beyond legal issues: Ethical marketing decisions foster trust, which helps build long-term marketing relationships.
In terms of philanthropy, firms that choose to take these extra steps concern themselves with increasing their overall positive impact on society, their local communities, and the environment, with the bottom line of increased goodwill toward the firm, as well as increased profits. Many firms try hard to align their philanthropy with marketing and brand image. Socially responsible behavior is not only good for customers, employees, and the community, but it also makes good business sense. For this reason, philanthropic activities make very good marketing tools. Thinking of corporate philanthropy as a marketing tool may seem cynical, but it points out the reality that philanthropy can be very good for a firm.
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Management Information Systems: Managing the Digital Firm, 15th Edition