Let's face it: With a mandate to put the best face on everything from cigarettes to shoe polish, advertising has never had a reputation as the most ethical of industries. And recent scandals—charges that Ogilvy & Mather executives overbilled their Office of National Drug Control Policy client and the involvement of Grey in a bid-rigging and kickback scheme with The Color Wheel—have not done much to improve that image.
But most agency execs say—even off the record—that they rarely face ethical quandaries. In more high-flying times, stories of clients asking for (and occasionally receiving) hookers and illicit substances on shoots were rampant. These days, however, while some still complain about "distasteful" dealings with clients, ethics and morals mostly come into play when working on a questionable product or when unduly large gifts are offered.
One 22-year ad-industry staffer says his professional ethics have never been challenged, but his personal morals have. One particularly sticky situation was when a client expressed interest in a sexual relationship, he recalls, advising, "You find a way of deflecting their interest in a way that doesn't affect the relationship."
Another executive recalled a client who made untoward advances to female staffers. The issue was resolved after he sat down with both the client and the client's boss and talked about the agency's "value system."
Often, the client is well aware when the line has been crossed. One high-level executive who has held marketing positions on both the client and agency side recalled declining a client's request for hookers while on a shoot. The client was more embarrassed than angry, he says.
The most prevalent dilemma comes in the form of selling a product one deems unworthy. "The closest thing I've had [to an ethical issue] is earning a significant portion of my paycheck from cigarettes," says one former executive from Leo Burnett, lead agency for Philip Morris. "[But] it is a product that, for whatever reason, the U.S. government has said can be legally sold."
Such rationalization—if you can call it that—is common. "Every product, in my view, is entitled to a good defense," says a source who has held top positions in New York and Minneapolis. "That's kind of the fun of it, as long as you're not outright lying." He points to the unfulfilled promises that littered ads for dot-com clients. "Was it unethical?" he asks. "I don't think so."
Ethical advertising is the domain of ethics committees at the American Advertising Federation and the American Association of Advertising Agencies—but those groups don't dwell on behavior at agencies. Rules covering topics such as what gifts are acceptable from suppliers are handed down via human resources departments. At shops owned by Interpublic Group, for instance, the code of conduct bars employees from accepting an "improper gift, monetary or otherwise"—specifically, any token valued at more than $200—from a vendor or potential vendor. The code notes that cheaper gifts may also be considered improper, depending on the circumstances.
"In this industry, gifts are given at Christmastime," says Carla Michelotti, general counsel for Leo Burnett and chair of the AAF. "Those gifts are not televisions; those are gifts of candy and flowers."
The exec who's worked in Minneapolis and New York says "kickbacks and gratuities" are the biggest ethical problem he sees in agencies. "You suspect it when you go to the production departments and you see the gifts stacked up," he says. But with holding companies setting strict guidelines across their networks, not to mention the stringent accounting standards imposed by the 2002 Sarbanes-Oxley Act, it's harder to give in to temptation than in more free-wheeling days.
Michelotti argues that recent scandals actually point out something positive about the ad industry: "In many ways, as sad as it is that these things are making the news, it certainly is showing the underlying and existing and continuing transparency of the transaction," she says.