Why Ethics allow trading contrary to recommendation?

For example, if the company issue a buy order, it can sell its stock immediately. Won’t it encourage dumping?

I’m not sure I understand your example. Do you mean a buy recommendation? The stock in question (i.e. being recommended), or its stock?

You have to be more specific, as it really depends on what the motivation for trading is. For instance, if an analyst is cash strapped and needs liquidity to cover immediate expenses, she may well sell the stock she recommended. This won’t constitute market manipulation, if the proper disclosures are made ex ante.