June 1998 | Fall 1996 | |
Moral Decline | 21% | 14% |
Crime and Drugs | 17% | 13% |
Retirement and Social Security | 14% | 15% |
Education | 14% | 14% |
Health Care | 11% | 12% |
Economy & Jobs | 4% | 12% |
Taxes | 4% | 5% |
Deficit/Gov’t Spending | 4% | 8% |
Welfare | 2% | 3% |
by Rushworth M. Kidder
LONDON
The business ethics movement is alive and well and living–a bit gingerly–in Britain.
The movement is not as well defined nor as broadly accepted as its counterpart in the United States, which it views with mingled regard and suspicion.
It hasn’t yet hammered out the language of values-based decision making that, in U.S. firms, is slowly replacing compliance-based sign-off sheets.
But facing a massive challenge–globalization–each side is looking for answers that bring the same ethical standards to bear in different cultures.
I draw these conclusions after years of watching the business ethics movement take shape on both sides of the pond, and after five days of intensive interviews and conversations here with more than 30 business executives, professors, teachers, foundation leaders, government officials, and ethics professionals.
On one thing they agree: British business hasn’t developed an ethics infrastructure like that of the United States. Few companies have “ethics officers,” although some assign ethics responsibilities to the office of company secretary, corporate or public affairs, or human resources. Ethics training programs are not much in evidence. Nor are ombuds offices and help lines. And while codes of practice are increasingly common, there’s some squeamishness about calling them codes of ethics.
As a result, a number of functions that fall into separate offices in U.S.-based corporations–around issues of environment, diversity, health, safety, and community relations–are here found milling around together in the same tent. Conceptually, of course, you can make a case that this menagerie has common moral parents: These are all the so-called “soft” areas. Herding them together, however, creates some confusion about just exactly what ethics is–not least in the minds of the zookeepers.
Nor is there a forum for learning from one another. There’s nothing here resembling the Ethics Officer Association in the United States, although the HUB Initiative of the Institute of Directors is looking at how business can better promote its values by setting up a forum to debate the issues nationally. There is also an increased focus on social and ethical audits, ethical sourcing, and sustainable development encouraged by the International Development Secretary.
But perhaps the most noticeable difference, according to knowledgeable insiders, is in the boardroom. Board-level ethics committees are increasingly common in U.S.-based firms. Here, there remains strong resistance to any overt boardroom consideration of ethical issues. That doesn’t mean the decision making is routinely unethical. British business, with its centuries-old tradition of “my word is my bond” and its pride in doing the right thing, has an inherently ethical dimension. It’s just that board-level conversations about the topic are viewed with mistrust, even embarrassment.
Why? In part because the business community here lacks a shared language of public discourse to unpack ethical issues. Instead, ethical issues tend to get expressed in at least three other languages. There’s the language of emotion, highly charged and often divisive. There’s the language of the ethics crusade, seeking to gin up public outrage against certain corporate behaviors. And there’s the language of moralizing, finger wagging and hectoring. Not only ineffective, these languages can be counterproductive. Needed: a language of moral decision making that can articulate the relationship between ethics and the bottom line–and then helps people live it out in practice. Without it, directors and officers naturally retreat into the “ethics is private” fortress.
Exceptions? Surely. Most notable, perhaps, is Shell, whose 1995 public relations disaster with Greenpeace and European environmentalists over disposal plans for its obsolete Brent Spar oil rig sent the company reeling into a deep rethink. In April it published the results: a candid, penetrating, and cutting-edge 56-page exploration of its values titled “Profits and Principles-Does there have to be a choice?” (See www.shell.com for more information.) Other companies here have also issued statements of values and social responsibility.
There remains, however, a suspicion of the U.S. ethics juggernaut. The reason? Some note that the word-loving English prefer to sort things out in broader understandings, while pragmatic Americans like to reduce things to a few crisp declarations. Others locate the difference in the “softly, softly” pace of British debate versus the “ready, fire, aim” mentality of the Yanks. Still others see a kind of cultural hypocrisy in the U.S. movement: How, one business professor asked me, can a nation whose children murder each other with guns have anything to tell us about ethics?
But these differences pale before the challenge of globalization, which remains the abiding concern on both sides of the Atlantic. Proud of their long ethical traditions, both countries are contemplating unpalatable alternatives as they go global. They can seek to impose the values of Manchester or Minneapolis on other nations. Or they can hide behind the adage, “When in Rome, do as the Romans do.”
Neither way works. So both may need to search for a set of shared global values that can carry them forward. Both know their success lies in espousing ethical standards that will allow them to survive in 21st-century crosscurrents. Both are mounting ethics initiatives–across firms, and across sectors of society–to explore this challenge.
In this regard, they’re poised to learn a great deal from each other.
Comments and questions? Reach me at rkidder@globalethics.org.
(c)1998 by Rushworth Kidder
That plea is offered up in hopes of resolving many a dispute, and frequentlyit works its way into matters of law and ethics. The “reasonable person”theory extends at least as far back as Aristotle, who advocated choices that a”reasonable” person would make when trying to choose a path of action betweentwo extremes.
The U.S. Supreme Court last week invoked a similar appeal to “reason” while handing down many major rulings as it moved toward the close of its 1997-1998term.
This week’s edition of Business Ethics Newsline leads off with a summary ofseveral decisions that will have an effect on the conduct of business,including three sexual harassment cases–among them the court’s take on theBurlington Industries case, which we have been following on these electronicpages for several weeks. Included in the court’s ruling was the provisionthat while an employee may sue for harassment even if no damage was sustained,a “reasonable” effort on the part of the company to stanch harassment mayprotect the firm from liability.
Another story in this week’s edition deals with the high court’s finding that people who are HIV-positive are covered by the Americans with Disabilities Act andtherefore must be “reasonably” accommodated in public facilities.
We conclude our Supreme Court wrap with a summary of a case dealing with anemployee’s rights during maternity leave.
In other news from the world of ethics, we report on the ongoing conflict oftwo rights in Great Britain–the right of the press to cover public issuesand the right of the accused to a fair trial.
A paralyzing strike against General Motors (GM) has raised a number of ethicalissues, including the parameters under which a union is allowed to strike. GMlast week claimed that the United Auto Workers reneged on an agreement thatdefined “strikeable” and “nonstrikeable” points of contention.
Is Viagra–an expensive but wildly popular impotence cure–a medicalnecessity or a lifestyle choice? We detail the decision of a panel of doctorsand ethicists convened by a health insurance provider.
An interesting example of the complications of cross-cultural ethics isprovided by another story in this week’s edition. We report on the decisionby the Chinese government not to allow Chinese singers to participate in theNew York staging of an opera that Chinese officials consider offensive.
Big things are coming out of the tiny state of Qatar, where a new all-newstelevision channel is featuring critical coverage of controversial issues inthe Persian Gulf, a region more accustomed to government-sanctioned coverageof ribbon cuttings and the like.
And we conclude our report with another story from Britain, which describes the roleof a major supermarket chain there in distributing surplus food to thehomeless.
–Carl Hausman
LONDON
The British supermarket giant Sainsbury’s last week urged U.K.companies to support Crisis Fareshare, a charity operation providing surplusfood to London’s homeless population, as the charity attempts to take theprogram nationwide.
Sainsbury’s pledged nearly $500,000 to the Fareshare program and called onother companies to help eliminate landfill taxes and the nearly 3,220 tons ofedible food that is wasted annually in the United Kingdom, the BBC reported.
DETROIT
General Motors retaliated last week against a crippling United AutoWorkers (UAW) strike at two plants in Flint, Michigan, by filing a grievance againstthe union, alleging that the strike violates the UAW’s labor agreement withGM.
The labor agreement stipulates only two legal strike issues: worker health andsafety, and production standards. While the UAW insists those are itsconcerns, GM says the union is using those issues as an excuse to push theautomaker into compromising on outsourcing and job security, the Reuters newsagency reports.
Calvin T. Rapson, newly elected director of UAW Region 1-C in Flint, disputedGM’s claim. “We’re comfortable that every day, we talk about strikeableissues,” Rapson told the Flint Journal newspaper. “There are other issues thatwe talked about, but [GM] agreed to talk about them.”
DUBAI, United Arab Emirates
An all-news television channel in the tiny butpetroleum-rich state of Qatar has sparked international controversy andnational debate by broadcasting discussions of traditionally taboo topics,steadily stealing the nation’s viewers from such news heavyweights as CNN andthe BBC.
The channel, known as al-Jazeera, has tackled such issues as Islamicfundamentalism, human rights abuses, the role of U.S. troops in the MiddleEast, and Qatari oppression.
After voicing prodemocracy sentiments on al-Jazeera, one Qatari lauded theopenness of the station, observing that “if I said any of these thingsanywhere else but on this station, I would go to prison,” the Associated Pressreported.
WASHINGTON, D.C.
The Supreme Court ruled last week that people who are HIV positive areprotected by the Americans with Disabilities Act (ADA), and must be reasonablyaccommodated by all institutions that serve the public.
The ruling comes after an HIV-positive woman sued her dentist, who refused totreat her in his office and told her that he would only treat her cavity in ahospital.
The Court’s ruling recognized HIV as an ADA-protected disability. Under thetheory put forth in this case, AIDS interferes with the right to reproduce,and therefore interferes with “major life activity,” as specified by the ADAin its determinations of which illnesses and disabilities are covered by theprovision.
SHANGHAI, China
Chinese officials have banned an opera that was to have beenstaged in New York City’s Lincoln Center, impounding the props and refusing tolet the singers leave Shanghai.
Shanghai’s Municipal Cultural Bureau blasted the opera, titled The PeonyPavilion, as “absurd, superstitious, and pornographic in a way that isunacceptable to Chinese viewers and artists,” the South China Morning Postreported.
Cultural Bureau officials later agreed to release the props but would notallow the singers to travel, according to the Associated Press.
The opera was financed by several nations, and the action by the Chinese castdoubt on the willingness of foreign companies to finance future artisticventures with Mainland China.
WASHINGTON, D.C.
The Supreme Court refused to revive the sex discriminationlawsuit of a New Jersey woman who sued her real estate employer for firing herwhile she was on maternity leave.
Deborah Rhett argued that her job should have been protected by the 1978Pregnancy Discrimination Act, which prohibits discrimination against employeeson the basis of pregnancy.
The Court let stand a lower court ruling that the firing was not illegal sinceRhett could not prove that the nature of her leave resulted in the loss of herjob, the Associated Press reported.
A federal law protecting employees’ right to medical and maternity leave–the 1993 Family and Medical Leave Act–was not applicable in this case because it was instituted after Rhett’s1991 suit was brought, and it does not cover small companies.
WASHINGTON, D.C.
The Supreme Court issued rulings on three major sexual harassmentcases last week, closing out the current term and clarifying somewhat theresponsibility of employers and employees in workplace sexual harassmentcases. The thrust of the rulings:
LONDON
The tumultuous relationship between the British press and the courtsystem weathered another storm last week after the jury in a high-profilebombing trial was dismissed because court officials feared jury bias afterintense press coverage of the case.
The trial of James McArdle marks the fifth time that worries of a press-biased jury have helped derail a U.K. court case, reports the BBC.
Critics have called for stricter legislation to rein in the British press.One proposed measure would ban the press from paying witnesses in an ongoingtrial for interviews. In Britain, reporters customarily pay many people theyinterview.
The British press was also reprimanded last week by Prince William, son of thelate Princess of Wales. Prince William charged the press printed untruths,intruded into his personal life, and violated the newspaper code of conductthat was revamped by Britain’s Press Complaints Commission after Diana’s deathto protect the privacy of celebrities’ children.
On Thursday, the Supreme Court held that HIV-infected people are protected by the federal ban on discrimination against the disabled even if they suffer no symptoms of AIDS. The ruling went against a dentist who told an HIV-infected patient that he would fill her cavity in a hospital, but not in his office. The woman, Sidney Abbott, sued under the Americans with Disabilities Act.
Below are excerpts from the decision in BRAGDON v. ABBOTT, holding that people who are HIV-infected and who have no visible symptoms are protected by the Americans With Disabilities Act.
Justice Kennedy’s majority opinion:
We hold respondent’s HIV infection was a disability under . . . the definitional section of the statute. . . .Chief Justice Rehnquist’s dissent:The statute is not operative, and the definition not satisfied, unless the impairment affects a major life activity. . . . Reproduction falls well within the phrase “major life activity.” Reproduction and the sexual dynamics surrounding it are central to the life process itself. . . .
HIV infection, even in the so-called asymptomatic phase, is an impairment which substantially limits the major life activity of reproduction. . . .
Notwithstanding the protection given (Sidney Abbott) by the ADA’s definition of disability, (dentist Randon Bragdon) could have refused to treat her if her infectious condition “posed a direct threat to the health or safety of others”. . . .
Because few, if any, activities in life are risk free . . . (the ADA does) not ask whether a risk exists, but whether it is significant . . . .
In assessing the reasonableness of (Bragdon’s) actions, the views of public health authorities, such as the U.S. Public Health Service . . . are of special weight and authority. The views of these organizations are not conclusive, however. . . .
The court is simply wrong in concluding as a general matter that reproduction is a “major life activity.” . . . But even if I were to assume that reproduction is a major life activity of [Abbott], I do not agree that an asymptomatic HIV infection “substantially limits” that activity. . . .While individuals infected with HIV may choose not to engage in these activities, there is no support . . . for the proposition that such voluntary choices constitute a “limit” on one’s own life activities. . . .
I disagree with the court . . . that in assessing the reasonableness of (Bragdon’s) actions, the views of public health authorities . . . are of special weight and authority. . . .
Given the “severity of the risk” involved here, i.e. near certain death, . . . it seems likely that (Bragdon) can establish that it was objectively reasonable for him to conclude that treating (Abbott) in his office posed a “direct threat” to his safety.
Each man cares that his neighbor shall not cheat him. But a day comes when he begins to care that he does not cheat his neighbor. Then all goes well–he has changed his market-cart into a chariot of the sun.
–Ralph Waldo Emerson (1803-1882)
Do you think that your own employer makes a genuine effort to invest in their own African-American employees by offering training programs and other incentives to help prepare them for advancement within the company? Yes: 53% How do you feel about the future prospects for your career? Would you say you are very optimistic, somewhat optimistic, somewhat pessimistic, or very pessimistic? Very optimistic: 33% Over the past several years, there have been several lawsuits brought against American companies for discriminatory practices against African-American employees. Do you think these discriminatory practices are still common, or are they rare? Common: 81% Agree or disagree: Strong antidiscrimination laws and enforcement are still necessary because most CEO’s and other senior business executives are not really concerned about racial discrimination in their companies. Strongly agree: 45% |
by Rushworth M. Kidder
In the last month, two of the world’s most notorious political regimes have been replaced. Haji Mohamed Suharto’s Indonesia and Sani Abacha’s Nigeria–among the largest and most influential nations of the developing world–were marked by collapsing economies, growing insecurity, and widening gaps between haves and have-nots. They were infamous for endemic bribery, strong repression, and the cronyism of their elites. Their leaders apparently siphoned billions of public dollars into private coffers.
In the spirit of full disclosure, let me note that Gen. Olusegun Obasanjo–a former head of state imprisoned for life by Gen. Abacha and released last Monday by Nigeria’s new leader, Gen. Abulsalam Abubakar–is a charter member of the advisory council of the Institute for Global Ethics. So when these regimes caved in–Indonesia’s by Suharto’s resignation, Nigeria’s by Abacha’s death–we shared in the televised jubilation of their populations. Watching them dance in the streets, we too felt liberated: Seeing how the small voices of the many could vanquish the powerful assertions of the few, we felt that goodness had prevailed.
From a business perspective, however, these changes raise most interesting questions. What are we to make of multinationals who had remained on good terms with these awful regimes? How is the public to judge them? Are they traitors that sold themselves out to stay in business, riding roughshod over human rights and environmental standards in an atmosphere of intense corruption? Or are they survivors that weathered rough waters, using their economic influence to moderate the excesses of the regimes while continuing to provide jobs, resources, and education to local employees? Were they weathervanes twisting in every breeze, or anchors in a turbulent time?
Posed this way, of course, the answer is, “That all depends.” The facts will be different for each corporation. If reforms continue in these countries, these facts will come to light. So it may be premature to ask whether a particular multinational is innocent or guilty. But two key questions can be addressed:
To the Kantians–who hold that ethics consists in doing only what we would like every executive in the world to do from now on in similar circumstances–absolute integrity must be the standard. In this view, any willingness to indulge corruption promotes an unacceptable double standard, leading you to do abroad what you would never do at home. This principled view–judging an action by the motives and duties behind it, rather than by its outcomes and consequences–can be criticized as unrealistically stern and unduly moralistic.
To those seeking the more care-based approach of the Golden Rule–that ethics consists in doing to others what we want them to do to us–the test lies in how I would want a multinational to behave to me. This compassionate view, urging us to put ourselves in the “others’” shoes, can be criticized for its uncertainty, depending on whether the “others” are identified as shareholders enriched by the firm or indigenous populations oppressed by the regime.
Each of these resolution principles provides a noble framework for judgment. Each has strong adherents. And each can be challenged. The point? A vigorous debate about a firm’s ethics is not necessarily a right-versus-wrong battle between those with ethics and those without it. It’s more apt to be a right-versus-right conflict, surfacing profoundly different philosophical viewpoints about what it means to be ethical.
To the second question, then: What can we learn? To the broader public, increasingly aware of the global actions of businesses, the relations of businesses and governments is a fundamentally ethical issue. There’s been stinging criticism of Shell for its treatment of the Ogoni people in Nigeria, and of Nike for its shoe-manufacturing practices in East Asia–criticism that both firms have heard, acknowledged, and seriously addressed. How? Not by having their managers talk about mere business strategies or the challenges of global competition. These days, those arguments simply won’t wash. These cases need to be argued in an ethical context. People are watching, and ethics matters.
How to make this case? We’ve long foreseen the time when ethical reasoning skills would be recognized to be just as important a tool in the executive’s kit bag as financial analysis or leadership ability. Given the information on multinational practices that may emerge from Nigeria and Indonesia in the next few months, that time may already have arrived.
(c)1998 by Rushworth Kidder
Trusting the intentions and goodwill of others is part and parcel of everydaylife. If we were forced to verify the authenticity of every claim, everystatement, and every action, commerce and government would certainly grind toa standstill.
That is why betrayals of trust often cause us to be chagrined, disappointed,and even outraged–a theme woven through several top stories in this week’sedition of Business Ethics Newsline.
Leading our report is a story that has captured national attention even inscandal-weary Italy. A case that began in the late 1980s–a bribery probethat Italians have come to call “the mother of all corruption trials”–lastweek culminated in the affirmation of the convictions of Italy’s former primeminister along with several other prominent politicians and businesspeople.
Betrayal of trust in a different venue is highlighted by a story involving theadmissions of two noted writers–a columnist for The Boston Globe newspaperand an associate editor of The New Republic magazine–that they violatedwhat some call the Eleventh Commandment of Journalism: Thou shalt notfabricate.
In other ethics-related news, the top military analyst for the CNN networkresigned in protest last week, claiming CNN rushed to air an unverified storyabout alleged use of nerve gas in Vietnam. Retired air force major generalPerry Smith claimed the report sacrificed accuracy and ethics in order togarner ratings.
Two stories this week focus on international issues involving rights andresponsibilities in the workplace. In Britain, the United Kingdom’s largest union hascharged that employers are taking “punitive” measures to verify sick-leaveclaims. And a report from Japan details what some observers see as a growingtrend of suicide brought on by overwork.
A story from California involves the creation of a national ethics council byKaiser Permanente, the nation’s largest health plan. The council willincorporate what Kaiser calls “value-based problem solving” in the health careindustry.
This week’s edition of Newsline features a pair of stories about the airlineindustry. One report from Washington involves a suit filed against the FAA bya group of female air traffic controllers who claim that harassment againstthem has endangered the safety of the traveling public. Also from Washingtoncomes a report about a flight attendants’ organization and its backing of legislation toprotect whistleblowers.
And we conclude our report on the week’s news in ethics with a court case inwhich the plaintiff–a former disc jockey at a lounge–claimed he wasforced to play music calculated to drive away black patrons.
–Carl Hausman
TOKYO
Increasing numbers of Japanese workers are committing suicide because of overwork–a practice called “karojisatsu”–focusing attention on whatlawyers for affected families claim is the responsibility of employers for thewelfare of their workers, the Associated Press reported last week.
Police estimate the number of suicides caused by long hours, low pay, and novacations totals more than 1,000 annually. The situation apparently has beenaggravated by Japan’s current financial crisis.
Japanese society condones suicide as an act of atonement for poor workperformance, the AP reports.
The phenomenon gained national prominence last year when the Tokyo High Courtruled that an advertising agency severely overworked an employee and wasinstrumental in causing his suicide, awarding his family $650,000.
WASHINGTON, D.C.
Two popular and prominent writers who lost their jobs afterseparate incidents of fabrication in their widely read articles issued publicapologies last week.
Boston Globe columnist Patricia Smith resigned after a routine fact checkrevealed that she had invented characters and quotations in order to–according to Smith’s published apology–”create the desired impact or slamhome a salient point.” Her apology was published as her final column in theGlobe, ending her eight-year career at the paper.
Dismissed New Republic associate editor Stephen Glass last week apologized forfabricating material in 27 of his 41 articles. He admitted devising anelaborate chain of forged evidence–including bogus interviews, pressreleases, and Web sites–to deceive fact checkers at the magazine.
LONDON
The United Kingdom’s largest trade union, Unison, has charged employers withenacting “punitive” policies against employees who take sick leave, oftenworsening ailments and workplace stress while attempting to verify workers’illnesses, the BBC reported last week.
Unison alleges that while malingering is a serious and legitimate problem,many employers’ sick-leave policies–which include calling sick employees athome and holding interviews upon their return to work–are often “harsh, arbitrary, and inconsistent in practice,” according to theBBC.
Spokespeople for Unison say the union’s research indicates that about two-thirdsof employers have instituted such aggressive new sick-leave policies.
WASHINGTON, D.C.
The Association of Flight Attendants (AFA) last week urged Congress to passlegislation protecting aviation industry whistleblowers, claiming that currentairline policies often punish workers who report safety dangers.
Joining with the AFA and the AFL-CIO, Transportation Secretary Rodney Slaterpetitioned lawmakers to help “allow aviation workers to be full partners inthe drive to make our skies even safer,” according to a press release from theAFA.
Legislation under congressional consideration would prevent airlines fromharassing and disciplining workers–including flight attendants, pilots, and mechanics–for reporting safetyflaws, according to the AFA statement.
