Ethics & Compliance in Sales Flashcards

The ethical obligation of a sales professional to act in the best interest of the customer, even when it conflicts with short-term sales goals, is known as:

Answer: Consultative selling ethics

Consultative selling ethics requires prioritizing the customer's genuine needs over immediate sales targets, building trust and long-term loyalty.

Which of the following practices would MOST likely violate the CAN-SPAM Act?

Answer: Failing to include an unsubscribe mechanism in commercial emails

The CAN-SPAM Act requires all commercial emails to include a clear and conspicuous mechanism for recipients to opt out of future messages.

Predatory pricing, where a company intentionally prices products below cost to eliminate competition, is primarily regulated under:

Answer: The Federal Trade Commission Act and antitrust laws

Predatory pricing schemes that harm competition are addressed under the FTC Act and broader antitrust laws designed to protect competitive markets.

When a sales executive discovers that a recently signed contract contains terms that were misrepresented to the client, the MOST ethical course of action is to:

Answer: Immediately disclose the error to the client and work to correct the contract terms

Immediate disclosure and correction of misrepresented terms upholds ethical standards, maintains client trust, and reduces legal exposure from fraudulent misrepresentation claims.

Social media ethics in sales requires that sales professionals:

Answer: Maintain honesty, respect confidentiality, and disclose affiliations when promoting products

Ethical social media selling requires transparency about affiliations, honesty in content, and strict protection of confidential customer information.

A sales manager is asked to inflate quarterly revenue figures for a board presentation. This request should FIRST be addressed by:

Answer: Reporting the request through the company's ethics hotline or compliance officer

Falsifying financial reports constitutes fraud and potentially violates securities laws; the appropriate response is to report it through compliance channels.

The concept of 'ethical reciprocity' in sales relationships means:

Answer: Treating customers the way you would want to be treated if the roles were reversed

Ethical reciprocity applies the Golden Rule to sales: sales professionals should treat clients with the same honesty, respect, and fairness they would expect as customers.