STUDENT NAME REGISTRATION NUMBER BATCH SUBJECT

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PINAKI SENGUPTA PGD-K/OCT11/04 OCTOBER 2011 ORGANISATIONAL VALUES AND BUSINESS ETHICS Simachal Mohonty

FACULTY NAME

DATE OF SUBMISSION

12TH DECEMBER,2011

WORD LIMIT

2500

ACTUAL WORD COUNT

2350

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CHECKLIST
Student Name Registration Number Date for submission of the Assignment. Is the cover page in the correct format as indicated in the Guidelines to Writing Assignments? Have I done a complete spell-check of the Assignment? Have I done a complete word count for the assignment? Does the table of contents include numbers? Are the pages numbered correctly? Are the figures numbered correctly? Are the tables / charts numbered correctly? Are the captions for the tables and charts proper? Are the references / bibliography listed in the Assignment? Are the references cited adequately in the text? All reference material has been cited from books, journals, and internet. The sources quoted have been vetted by the Tutor concerned. Are the references in the text in the proper format as indicated in The Guidelines to Writing Assignments Has a soft copy of the Assignment been enclosed? PINAKI SENGUPTA

PGD-K/OCT11/04
12.12.2011 YES YES YES YES YES NA NA NA YES NA YES

YES YES

Declaration: All materials written in this assignment is my own and I have not used any material, content or information of others claiming them to be mine. Wherever materials have been used, proper citation has been done in the text. I am fully aware of the rules and regulations governing plagiarism. Should at any point of time my work be suspected / investigated and established to have been plagiarized, I am aware of the consequences. I have read the Students Handbook in detail.

Signature of the Student

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INDEX

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Content
FACTORS INDUCING ORGANISATIONS FOR UNETHICAL

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ADVERTISEMENTS A COMPREHENSIVE REPORT ON ISSUES OF ETHICS IN ADVERTISING IN INDIA USING CASES OF ETHICAL AND UNETHICAL ADVERTISING, GUIDELINES OF A.S.C.I

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(ADVERTISING STANDARDS COUNCIL OF INDIA) AND A LEGISLATIVE FRAMEWORK TO CURB UNETHICAL ADVERTISING. ANALYZING WHETHER THE PRESENT REGULATORY 9-10

FRAMEWORK IS ADEQUATE TO ENSURE ETHICAL ADVERTISING IN INDIA AND RECOMMENDATIONS TO DEVELOP A MORE EFFECTIVE CONTROL FRAMEWORK. BIBLIOGRAPHY

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THE FACTORS THAT INDUCE ORGANIZATIONS TO MAKE CLAIM THAT MAY NOT BE BACKED BY REAL RESEARCH OR FACTS ARE:

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1. To make the product more trustworthy: advertisers go for such advertisements to make their product more trustworthy which helps in achieving customers trust. 2. To make the product attractive: organization go for such advertisement to make the product more attractive which helps in drawing customers immediate attention and thus convincing them to go for their product. 3. To influence the customers to buy their product atleast once: There are various manufacturers who introduce product for the first time in the market and thus want the customers to try them atleast once so that they come to know about the goodness of the product and thus, organization go for such advertisement to get the immediate consumers attention. 4. For positioning their product: organizations go for such advertisements to position their products in the market. Such advertisements create a lasting impression in the mind of the customers and thus help in brand positioning. 5. To compete with other brands: organization also opts for such advertisement to stay ahead of other brands by putting forward such facts which are more advantageous and useful than others. 6. To popularize their product: Such advertisements are also done to popularize their product in the market in order to attract mass consumers. 7. To hide certain demerits or side effects of the product: Certain advertisers go for such advertisements to hide certain demerits or side effect or long term consequences of using the product and thus making the products more attractive. 8. To create a brand image: it is also done by various advertisers to create better brand image in the market.

PREPARE A COMPREHENSIVE REPORT ON ISSUES OF ETHICS IN ADVERTISING IN INDIA USING CASES OF ETHICAL AND UNETHICAL ADVERTISING, GUIDELINES OF A.S.C.I (ADVERTISING STANDARDS COUNCIL OF INDIA) AND A LEGISLATIVE FRAMEWORK TO CURB UNETHICAL ADVERTISING.
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An Advertisement is said to be unethical when a product or service is misrepresented or some of its side effects or demerits are omitted or hidden with an intention to mislead customers. There are various advertisements where products are claimed to provide the best effect or service which in reality is absolutely false and are done with an intention to mislead customers to buy the product or service. They also use untrue paid testimonials, quoting misleading prices to convince buyers. It is mostly found in advertisements of financial institutions, health drinks, cosmetics, shampoos and health related products like body building, weight loss etc. Some of the common examples are: Certain Manufacturers of Fairness creams claim that their product will make the user fairer in just one month like Vivel Fairness cream. There are various financial institutions who claim to double the money in just six months and thus, convince the customers to put their money but after some months they wind up and run away taking peoples money. There are many educational institutes who claim to have ranked in the top 50 or 100 institutes in the country, provide best education, placements with better package, affiliated under renowned universities which in reality are either false or exaggerated. Some manufacturers of cooking oil claim to reduce heart problems or keeping a person fit, there are certain health drinks which claim to provide complete nutrition or energy, there are even some medicines which claim to make its user taller or provide energy or good body muscles without stating their side effects. There are various fruit drinks or juices commonly known as sharbat claim to provide real fruit juice but in reality they are artificially flavored and are also harmful to health like rasna, mango frooti etc. These products are sometimes not only harmful to user but also pose a threat to the consumers life. Products are made attractive by reducing their prices but subject to various terms and conditions which are kept hidden or written in such a way that it cant be read and are only disclosed either after selling the product or just before the sale leaving the consumer no choice than buying it. Various advertisements are directed to get childrens attention so that they force their parents to buy the product. They make the product so attractive that children finally end up buying it and some of which are not even good for health. Various advertiser use harmless superlative which are used to boast the merits of their products like, the best, finest, number one, etc. which are even permitted by law for trade puffing or exaggeration.
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Various advertisers take the help of women or sex appeal to gain customers attention. There are certain products which are not really required to be advertised by women or use their sex appeal but they are actually used just to get the maximum consumer like Lux soap, santoor powder, etc. ADVERTISING STANDARDS COUNCIL OF INDIA (ASCI) GUIDELINES CHAPTER I To ensure the Truthfulness and Honesty of Representations and Claims Advertisements must be truthful Where advertising claims are expressly stated to be based on or supported by independent research or assessment, the source and date of this should be indicated in the advertisement. Advertisements should not contain any reference to such person, firm or institution which confers an unjustified advantage on the product advertised or tends to bring the person, firm or institution into ridicule or disrepute without permission. Advertisements shall neither distort facts nor mislead the consumer by means of implications or omissions. Advertisements shall not be so framed as to abuse the trust of consumers or exploit their lack of experience or knowledge. Obvious untruths or exaggerations intended to amuse or to catch the eye of the consumer are permissible provided that they are clearly to be seen as humorous or hyperbolic and not likely to be understood as making literal or misleading claims for the advertised product. CHAPTER II To ensure that Advertisements are not offensive to generally accepted standards of Public Decency. Advertisements should contain nothing indecent, vulgar or repulsive which is likely, in the light of generally prevailing standards of decency and propriety, to cause grave or widespread offence. CHAPTER III No advertisement shall be permitted which:

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(a) Tends to incite people to crime or to promote disorder and violence or intolerance. (b) Derides any race, caste, color, creed or nationality. (c) Adversely affects friendly relations with a foreign State. Advertisements addressed to minors shall not contain anything, whether in illustration or otherwise, which might result in their physical, mental or moral harm or which exploits their vulnerability. Advertisements should contain nothing which is in breach of the law nor omit anything which the law requires. CHAPTER IV Advertisements containing comparisons with other manufacturers or suppliers or with other products including those where a competitor is named, are permissible in the interests of vigorous competition and public enlightenment, provided the advertisement does not unfairly denigrate, attack or discredit other products, advertisers or advertisements directly or by implication. Advertisements shall not be similar to any other advertisers earlier run advertisements in general layout, copy, slogans, visual presentations, music or sound effects, so as to suggest plagiarism.

LEGISLATIVE FRAMEWORK TO CURB UNETHICAL ADVERTISEMENT Unfortunately despite several laws meant to protect consumers against such unfair trade practices, false and misleading advertisements continue to exploit the consumer. A number of institutions are involved in regulating advertising. These are: 1. Self-regulation by the industry 2. Regulation by the Government

REGULATION BY THE GOVERNMENT: In India the government assumes the role of regulating the business activity by bringing a number of laws, regulations and codes. The following laws have been enacted by the government, which contain provisions that regulate advertising in India. These laws can be divided into two categories.

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Laws having horizontal application on advertising The Consumer Protection Act, 1986. The Emblems and Names (Prevention of Improper Use) Act, 1950 Trade and Merchandise Marks Act, 1958. Cable Television Networks (Regulation) Act, 1995 Indecent Representation of Women (Prohibition) Act, 1986. Monopolies and Restrictive Trade Practices Act, 1969. Motor Vehicles Act, 1988

Laws having vertical application on advertising Section 58 Companies Act, 1956 Drugs and Cosmetics Act, 1940. Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954. Pre-natal Diagnostic Techniques (Regulation and Prevention of Misuse) Act, 1994. Prevention of Food Adulteration Act, 1954/ Food Safety and Standards Act, 2005. Prize Chits and Money Circulation Schemes (Banning) Act, 1978. Prize Competition Act, 1955 The Infant Milk Substitute, Feeding Bottles and Infant Foods (Regulation of Production, Supply and Distribution) Act, 1992 and Amendment Act, 2002. Transplantation of Human Organs Act, 1994 The Young Persons (Harmful Publications) Act, 1956

AGENCIES INVOLVED IN THE SELF REGULATION Advertising trade associations Advertising Standards Council of India (ASCI) Advertising Association of India (AAAI) Press Council of India Prasar Bharti Individual media and media groups Code for commercial advertising on Doordarshan All India Radio Code for commercial advertising

ANALYZE WHETHER THE PRESENT REGULATORY FRAMEWORK IS ADEQUATE TO ENSURE ETHICAL ADVERTISING IN INDIA AND ALSO ENUMERATE YOUR RECOMMENDATIONS TO DEVELOP A MORE EFFECTIVE CONTROL FRAMEWORK.

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Though various laws are enacted to protect consumers against such unfair trade practices, false and misleading advertisements continue to exploit the consumer. The reasons are outdated laws, improper enforcement of the laws and so on. Now, it has really become important for the consumers to actually take action against such advertisements. The Laws should be revised from time to time and should be enforced effectively, better self-regulation by industry independent regulator to ensure ethical advertising in India. In order to control such unethical advertisements, laws are not only enough but consumers participations are very essential. Following steps should be taken to curb such advertisements: 1. Consumer should stay aware and should gather sufficient information before making any purchasing any commodity or service. Especially the children should be kept aware of such false claims and such advertisements should that they dont get influenced by such claims or advertisements. Therefore, it is very important to collect information and use our own logic before buying any product or service. 2. Various websites should be launched where informations on such unethical practices should be furnished for making the people aware. 3. People are now using Social Networking sites such as facebook, Orkut, Twitter, etc and thus, such websites should be used to make people aware of such practices. 4. Government should take immediate steps and should try to form various regulatory bodies to curb down such practices. 5. Reserve Bank of India should take immediate steps in closing down those banks which are likely to mislead the consumer or take away their money. These Banks make such tall claims that they can be easily identified that they are formed with such bad intentions. 6. The Consumer Protection Act or ASCI doesnot have much power to act on its own. They can take action only if any complaint is made to them by the consumer, industry or any other related party and thus, action gets delayed and which gives such advertisers sufficient time to fulfill their intentions and mislead the consumers. Therefore, such Acts should be amended so that they can act on its own without waiting for any complaint from consumers.

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7. Consumers should take part in various measures undertaken by various consumers or organization to curb down such unethical advertisements. Consumers should take initiative to convey their experiences on such misleading advertisements so that they can save other consumer to get cheated by these advertisements. Such kind of steps should be taken up various media who reach to a larger amount of people so that these people can be made aware of such practices and should also request the consumers to convey any such misleading advertisements taking place. Consumer should also take immediate step or should take the help of legislative framework immediately if he/she is being cheated so that such advertisers can be punished and stopped from doing such activities to mislead the consumers. 8. Terms and Conditions which are written in such a way which cannot be noticed or seen should be stopped and it should be made mandatory to write such terms and conditions in such a way that they can be seen and noticed as often these are written so that the people doesnot come to know about certain disadvantages or difficulty or side effects. 9. Students of schools and colleges should be made aware through internet and various other media and should be encouraged to discuss about such practices so that they put forward their suggestion which should be implemented if it is found to be effective and efficient to curb down such practices. 10. Apart from the above mentioned Act. If any consumer has been misled by bank, he can take the help of Reserve bank of India which is the apex bank of India, if by telecom company than to Telecom Regulatory Authority. Consumer Satisfaction is now considered the main and important objective of any organization or company and if the consumer satisfaction is not taken into consideration than such company or organization is more likely to get driven out of the market and thus, inspite of all such efforts to mislead the consumer, the organization will only be able to earn short term profit or no profit at all because its the needs of the consumers which are meant to be satisfied with these product or services and if these product or services fail to do so than there remains no point of producing such product or services Thus, if any company wants to grow big and earn huge amount of profit than they are bound to take the help of such ethical advertisements and satisfy the needs of the consumers by building trust in the minds of the consumers.

BIBLIOGRAPHY http://www.exchange4media.com/e4m/media_matter/omnibus.asp
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Dated : 10th December, 2011

http://www.easylawmate.com/Chapter/ASCI_Code.pdf Dated: 11th December, 2011

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