How Consumers Can Force Corporations to Behave Better

HADLEY, MA: If you don't understand business ethics basics, it could cost you--a lot!

  • Ask the workers at Enron who were hornswaggled into taking worthless stock and now have no retirement savings
  • Ask the families who suffered injuries, deaths, and medical bills when their Ford Explorers rolled over, or--years ago--their Ford Pintos exploded
  • Ask the consumers in California, where Enron and several other companies ganged up to create an electricity crisis that left much of the state in darkness--and caused soaring electrical prices and an expensive crisis in state government

    But at the same time, consumers can reward ethical businesses with profitability, and take their business elsewhere when the sleazoids knock at the door: Marketing ethics expert and consumer advocate Shel Horowitz, author of the startling new book Principled Profit: Marketing That Puts People First (AWM, 2003), explains that every time a business is caught in an ethics problem, somebody gets hurt. "These aren't just abstract things to read about in the headlines. Real people suffer the consequences when these crooks steal from all of us."

    The book points out that businesses do well when they have a values-driven message that resonates with their customers--and badly when they don't:

  • 76 percent of consumers would switch brands or retailers for a cause they support
  • 13 percent of all investments--over two trillion dollars--now go into funds with social screens
  • Ethnic and subculture groups also prefer to support sympathetic businesses, and now control well over a trillion dollars in discretionary spending
  • Ford profits were down 26.8% at the end of 2002, including including a $525 million loss in Europe