Students graduating from business schools are well trained in business theory and quantitative analysis but it is essential they are also given a firm foundation in making the ethical decisions that are critical in today’s business environment. The Consolidated ICC Code for Advertising and Marketing Communications Practice, revised and released in its 9th edition, provides a framework of ethical best practices and standards that are accepted worldwide. In addition to the new Code, a classroom-ready module, designed specifically for use with business students, is also now available.
Educators know how important it is for their students to understand and maintain the highest ethical standards throughout their careers. This is a responsibility that business and society demand – and that is especially challenging for advertising and marketing professionals given today’s rapidly changing communications techniques. In this environment, the International Chamber of Commerce (ICC) is committed to encouraging the education of current and future practitioners on the importance of complying with self-regulatory codes.
The ICC Consolidated Code of Advertising and Marketing Communications Practice, a revised self-regulatory guide to ethical standards, is now available. Developed by experts from all sectors of industry and all regions of the world, it provides a comprehensive framework that clearly sets out the dos and don’ts of responsible marketing.
Students taught the fundamentals of the ICC Code, their rationale and application will have a good understanding of the “rules of the road” no matter where they invest themselves. They will be better equipped to operate ethically as a reflex and avoid costly mistakes that harm their companies and their careers. A classroom-ready module developed in partnership with INSEAD is available for this purpose.
The Code includes specific provisions and requirements for ethical behaviour in all phases of marketing, including sales promotion, sponsorship, direct marketing, digital marketing and the use of environmental claims. As a “living” self-regulatory framework, it contains built-in language and mechanisms that make it easily adaptable to emerging trends and needs that will arise in future.
Specific areas addressed include:
- Online behavioural advertising
- Digital interactive media
- Environmental claims
- Privacy protection
- Marketing to children
|Code Highlights and Innovations|
Basic Principles of the Code
This Code is structured in two main sections – General Provisions and Chapters. The General Provisions section contains fundamental principles and other broad concepts that apply to all marketing in all media. The Chapters are detailed and apply to specific areas of marketing -- Sales Promotion, Sponsorship, Direct Marketing, Digital Media and Environmental Marketing Claims.
Some of the broad principles covered are:
- Transparency – The Code specifies that communication must be truthful, clear and not misleading. It emphasizes the importance of open, honest and responsible communications. It calls for disclosure of the marketing practices used. Through this transparency it seeks to preserve and enhance consumer trust and confidence in business and its communications.
- Privacy – The Code details a full list of consumer rights, including the right to require that data isn’t passed on to another party and to correct incorrect data. Guidance is also provided in the Code on the proper collection, use and safeguarding of personal data. New provisions cover digital communications, including online behavioural advertising (OBA), where user control is a significant part of OBA responsibility.
- Children – Children are considered a special group requiring special care and diligence by marketers to avoid harm and exploiting their lack of experience. Among the guidelines related to marketing to children, the Code states: (a) only products suitable for children are marketed in media intended for them; (b) advertising and marketing communications geared to children should be clearly identifiable as marketing; (c) communications should not undermine positive behaviour, social mores or parental judgement; (d) parents are encouraged to participate and supervise online activities; (e) parental approval is given prior to gathering personally identifiable information; and (f) no online behavioural advertising segments can be designed to target children.
- Respect –Respect for human dignity and standards of decency is the ethical underpinning of the Code. All guidance in the Code supports the goal of having marketers meet consumers’ reasonable expectations.
Digital Interactive Media
The Code has integrated rules that apply to marketing communications using digital interactive media throughout the guidelines. There also is an entirely updated section dealing with issues specific to digital interactive media techniques and platforms.
Code self-regulation on use of digital interactive media includes:
- Clear and transparent mechanisms to enable consumers to choose not to have their data collected for advertising or marketing purposes.
- Clear indication that a social network site is commercial and is under the control or influence of a marketer.
- Limits are set so that marketers communicate directly only when there are reasonable grounds to believe that the consumer has an interest in what is being offered.
- Respect for the rules and standards of acceptable commercial behaviour in social networks and the posting of marketing messages only when the forum or site has clearly indicated its willingness to receive them.
- Special attention and protection for children.
Online Behavioural Advertising (OBA)
For the first time, the Code addresses responsibility in the use of online behavioural targeting in the delivery of advertising.
Definition: OBA refers to the practice of collecting information about a user’s online activity over time, on a particular device and across different, unrelated websites, in order to deliver advertisements tailored to that user’s interests and preferences.
- Code guidance on use of OBA by website operators or third parties on a non-affiliated website includes:
- Clear and conspicuous notice regarding if and how OBA data collection is used. Notice should include the type of data collected and the purpose for collecting it.
- Having an easy-to-use mechanism to let consumers decide about the collection and use of their data for OBA purposes
- Obtaining explicit consumer consent for OBA in all cases of collecting and using data via technologies or practices intended to harvest that data from all or almost all websites visited by a particular computer or device across multiple web domains.
- Obtaining explicit consumer consent for creation and use of OBA segments relying on sensitive data.
- Maintenance of appropriate physical, electronic and administrative security and data protection safeguards.
- Prohibition of segments designed to target children 12 and younger.
Given the increased attention of environmental claims in marketing, this Code has been updated in-line with international standards and its companion resource, the ICC Framework for Responsible Environmental Marketing Communications . Together these tools help marketers and their agencies evaluate claims to ensure their messages hold up to the basic principles of truthful, honest and socially responsible communications and avoid misleading consumers. While the principles are simple, applying them to make new environmental claims, often based on terms that are not universally understood, is more complicated. ICC guidance maps that process for companies and provides a standard for self-regulators to evaluate when claims are questioned.
Definition: Environmental claims refer to any claim in which explicit or implicit reference is made to environmental or ecological aspects relating to the production, packaging, distribution, use or disposal of products.
Code guidance on use of environmental claims includes:
- Ensuring that all statements and visual treatments do not mislead, overstate or exploit consumers’ concern for the environment, given their possible lack of knowledge in the area.
- Avoidance of general claims, like “environmentally friendly,” “green,” “sustainable,” and “carbon friendly,” unless there is validation of the accomplishment against a very high standard of proof.
- Presenting qualifications in a way that is clear, prominent, understandable and accessible to consumers.
- Presenting improvement claims separately so it is clear whether each claim relates to the product, an ingredient of the product, the packaging or an ingredient of the packaging.
- The inappropriateness of: (a) emphasizing a marginal improvement as a major gain; (b) highlighting the absence of a component that has never been associated with the product category; or (c) claiming superiority over a competitor unless a significant advantage can be demonstrated.
Fairness, transparency and clear explanation are key factors in responsible sales promotion. Among the topics covered in the Code are: (a) presentation and administration of promotions; (b) safety and suitability; (c) information requirements; and (d) particular obligations of promoters and intermediaries.
This section of the Code applies to all forms of sponsorship relating to corporate image, brands, products, activities or events of any kind run by commercial and non-commercial organizations. It includes sponsorship elements forming part of other marketing activities, such as sales promotion and direct marketing, or in conjunction with a corporate social responsibility programme. A consistent theme of this section is respect for the sponsor, the sponsorship property and the audience.
Standards for ethical conduct in all forms of direct marketing include the clear presentation of terms and fulfilment requirements and procedures of each offer, along with clear presentation of a consumer’s rights in relation to each offer. The section includes new content on requirements when using electronic media for direct marketing and when using telemarketing. For telemarketers, there are precise guidelines about responsible behaviour in: (a) making outbound calls; (b) reaching a sales agreement or agreement for further contact; (c) monitoring and recording conversations; and (d) the use of automatic dialling equipment.