Business Ethics and Corporate Social Responsibility Report 2022

Running Head: BUSINESS AND CORPORATION LAW
0
Business Ethics and Corporate Social Responsibility
4/2/2020
Student’s Name

Business Ethics and Corporate Social Responsibility
1
Overview
Advertisements have great significance in the choices of consumers and their purchases.
This is the reason that these advertisements must be fairly and ethically developed and must not
contain any misrepresentation or misstatement. This report aims to develop an understanding of
the misleading advertisement and its impact on children. In addition to this, the report will focus
on examples of such unethical practices and voluntary codes developed in the relevant area.
Pester Power and misleading advertisement
Firstly, to discuss the concept of Pester power this is to state the same refers to the ability
of children to pressurize their parents to buy the products, mainly those that are advertised in
media (phrases.org.uk, 2020). Due to pester power, parents often ended buying those products
that their children barely require and it causes a waste of money to them. Misleading
advertisement often leads to pester power due to that parents has to buy those products which
have no use or can be held dangerous for their children as such advertisement leave a strong
influence on their child. Here it becomes clear that only but their parents are also likely to be
affected by these advertisements and therefore a reasonable and responsible behavior is required
under on the part marketing and advertising companies.
Misleading advertisement: Law and example
To prohibit the practices of misleading advertisements, some laws have been developed
by the Australian Competition and Consumer Commission. This law is contained under section
18 of “Australian Consumer Law”. This section restricts the practices concerning misleading or
deceptive advertisements (legislation.gov.au, 2020). As per this section, no person must pursue

Business Ethics and Corporate Social Responsibility
2
misleading or deceptive conduct or those conduct which are likely to be misleading or deceptive
in trade or commerce. Further, in conjunction with deceptive and misleading conduct, a business
is also restricted to make misleading or false claims about services or goods (accc.gov.au,
2020a). This act recognizes some advertisement and marketing techniques that businesses often
pursue. ACCC has provided the right to industries to adopt voluntary code to regulate market
behavior. To discuss one of the misleading advertisements presented on the website of the
ACCC website, the case of Samsung is to be discussed. In this case, the ACCC has started the
proceedings against “Samsung Electronics Australia Pty Ltd” as the same made a misleading,
deceptive and false representation in its advertisement while presenting the water-resistance
feature of different 'Galaxy' branded mobile phones. In its advertisements, it was claimed Galaxy
phones are water-resistant for 30 minutes and that too in 1.5 meters. Samsung has advertised
these phones widely all over social media, broachers, TV and other online and offline channels
(accc.gov.au, 2020b). ACCC alleged that Samsung had no reasonable ground to make this
presentation because galaxy phones were not suitable to use in all types of water. The
advertisements were misleading as the situation was not true what was claimed in the same. It
was held that using these phones in any other liquid could damage them.
Voluntary code of ACCC
Now, moving the discussion towards AANA code, this is to state that the same has
developed as a guideline to market product to children. "the Australian Association of National
Advertisers" has developed this code to provide safeguard to the interest of children. The code
demands every marketing communicator or adviser to consider the factors of social values,
safety, sexualization, and others and to ensure that none of them present in the advertisements