The establishment of voluntary ethical codes of conduct has increased substantially in western companies since the 1990s. An important effect of the growing concern for ethical trade is that stakeholders in the western world are becoming aware of the conditions in less developed countries, where so many of our consumer goods are produced (Blowfield, 1999). Voluntary ethical codes of conduct in western corporations, in conjunction with consumer, and other stakeholder, perceptions and requirements form a complex set of concerns. The purpose of this paper is to discuss why and how low-price companies in retail trading are communicating ethics primarily through the establishment of ethical codes of conduct. Moreover, the study's empirical data, including interviews, sheds new light on the incentives for retail trading companies to establish codes of conduct. Most importantly, though, this paper develops implications for the communication of ethics in relation to corporate social responsibility and consumer perceptions. The paper attends to relevant theories on corporate social responsibility, ethics as communication strategy, the ethics gap and consumer interpretations, then moves to the empirical study. The paper ends with a discussion on corporate communication of ethics and the ability to assure ethical standards and conclusions.
Researchers disagree about whether consumers really care about corporations' ethical conduct (e.g. Carrigan & Attala, 2001; Creyer & Ross; Micheletti et al., 2003). Nevertheless, the ways in which consumers perceive the communication of ethics, and how they act with respect to this, is essential for both the ethical strategy and communication strategy in corporations. In the present study, examined companies have surprisingly little knowledge of how the communication of their ethical work was perceived among stakeholders, and, moreover, whether it had any impact on consumers' purchase behavior; nor had they done market research on how ethical issues are perceived and evaluated among stakeholders.
Companies have a desire to put forward a trustworthy "corporate-citizen" image. They hope to achieve this by linking ethical and social responsibility - emphasized in establishing and implementing ethical codes of conduct - to the business mission and strengthening the corporate image. Although the ethical codes do not tell what the company really does, even if the codes in themselves are indications of what the company wants to communicate, many companies are cautious in their external communication of ethics. They are caught in the dilemma of making more promises than they can keep. However, there is a growing agreement among companies concerning the necessity of introducing ethical codes of conduct (Berenbeim, 2000). Nevertheless, central issues, as the reasons behind, are still vague.
The importance of studying the current shift in communication strategies in Swedish retail trading into an explicit communication of social responsibility and the establishment of ethical codes of conduct has two significant parts. First, the industry’s immediate relationship to its consumers, which makes it more sensitive for new trends and second, the fact that retail trading companies in the textile industry early outsourced, their production to suppliers in low-cost countries. On the Swedish market, retail trading companies like IKEA, Indiska Magasinet and Lindex, therefore can be seen as forerunners for other industries.
ethical codes of conduct, business ethics, social responsibility, communication of ethics, ethical and political consumption, working conditions
3rd Annual Inter-Disciplinary CSR Conference, International Centre for Corporate Social Responsibility, Nottingham: Nottingham University, October 21-23, 2004.