Ethics Newsline®

As pointed out in last week’s column, even the very mention of the word “ethics” seems to impel a certain cynicism, especially among those who consider themselves especially worldly. As you may remember, a publication on business ethics questioned whether the corporate transparency movement had really accomplished anything, given the recent meltdowns of several major firms. Various media, including the Washington Post, cluck-clucked their observations that corporate ethics is oxymoronic anyway, and implied that discussion of ethics was an ivory-tower exercise far removed from the realities of the real world.

Perhaps academic types who teach ethics (and here I plead guilty on behalf of my profession) are partly to blame for the popular misconception that ethics is some sort of precious parlor game played only until things get tough or the stakes are too high. We tend to talk in the abstract and theoretical, which may lead to the impression that the field of ethics has few real-world applications.

That’s just not the case. Almost all news has an ethical component. We’re just not acute enough in identifying it. And we seem to hate using the word.

Look at some of the top mainstream-media stories this week:

1. Pakistani President Pervez Musharraf writes 20 amendments into the constitution guaranteeing that someone won’t do to him what he did to his successor — overthrow him in a coup. While this is hardly Jeffersonian democracy, the United States stays mum. The ethical angle: Pakistan is one of our most strategic allies in the fight against global terrorism. Do we take the view that the greatest good for the greatest number will be accomplished by winking at the relatively small infractions in Pakistan in hopes of defeating a larger evil? That’s hardly a new question in the study of ethics, and every weekend punditry show considered this ethical angle without naming it as such.

2. CBS and CNN pay for tapes allegedly portraying the activities of al Qaeda. Paying for news is one of the oldest controversies in the business, and media ethics journals are bulging with articles about the implications of the practice. Apparently no one ever reads those articles because every time the issue surfaces, it’s treated by the mainstream media as a shocking and unprecedented revelation. But the root ethical issue balances on some standard ethical fulcrums. Do we run the long-term risk of the complete commodification and commercialization of news footage for the short-term benefit of dramatic insight into an important topic?

3. An Enron executive, Michael Kopper, pleads guilty to criminal charges and agrees to cooperate with prosecutors. At issue: Is it right to offer mercy for one perpetrator who “turns,” in the interest of exacting justice against the bigger fish? At issue in a broader sense: Are the recent “perp walks” of various corporate executives simply publicity stunts, or is it in the ethical interests of justice to show that book-cooking (which is easy and profitable) can result in exceptionally harsh penalties? There is a self-versus-community dilemma buried in here, too, as (some would argue) we seek to lower the boom on a few executives unlucky enough to get caught in an effort to resuscitate the gasping stock market, which in August finally began to post consistent gains.

4. A so-called secret court goes public, warning that it will not sanction abuses by intelligence agencies. The Foreign Intelligence Surveillance Court of Review had typically been quite lenient with investigators in demanding probable cause before allowing wiretaps and other such intrusions. But last week, the group drew the line and cited many incidents in which the U.S. Justice Department may have overreached. Here we see a classic invocation of “rule-based” ethics: The court effectively says, yes, it’s expedient that we relax the burden of proof in the effort to uncover a vicious and hated enemy, but what would happen if every level of justice operated on the expediency principle? In the long run, justice will not prevail if we take too many convenient shortcuts.

There’s an old saying, variously attributed, that ethics is what you do when no one’s looking. We might amend that to read that ethics is what you talk about — whether you use the word or not — when you weigh the relative merits of competing, controversial measures.

(c)2002 by the Institute for Global Ethics

“The NBA’s partnership with Lorillard sent the wrong message to our children about the harm caused by tobacco use…. Lorillard is trying to use partnerships with reputable organizations to create the image that it has changed, when in fact it and the other tobacco companies continue to engage in marketing practices that addict more than 2,000 kids every day. Lorillard’s ‘Tobacco is whacko if you’re a teen’ program frames smoking as an adult activity, which, as any parent knows and tobacco industry documents recognize, is one of the most effective ways to tempt teens to try a forbidden activity.”

– A statement from four leading anti-smoking groups, which petitioned the U.S. National Basketball Association (NBA) to drop a Lorillard Tobacco subsidiary as a sponsor of a youth basketball tournament. Although the NBA had quietly dropped Lorillard official sponsorship, it had retained the company’s Youth Smoking Prevention Program as a backer. Critics say the youth-targeted program is insincere at best and duplicitous at worst, convincing teens to smoke by casting the activity as a temptation; tobacco companies — and the NBA — disagree, according to a report from the New York Times.

HOUSTON
Enron insider Michael Kopper last week became the first of the fallen firm’s former executives to plead guilty, agreeing to surrender $12 million in ill-gotten gains and help federal prosecutors with their case.

Kopper, a seven-year veteran at Enron, served under the company’s former chief financial officer, Andrew Fastow, who prosecutors suspect masterminded much of the fraud that felled the company last year.

Enron, which built an empire based on fraudulent transactions and shady partnerships, staggered in October 2001, ousting Fastow and announcing a $1.2 billion restatement. The company soon went bankrupt, leaving many employees and shareholders shattered and broke.

In February, Kopper invoked his Fifth Amendment right and refused to testify before Congress. Last week, he changed his mind, pleading guilty to money laundering and wire fraud and promising to help the government.

In testimony last week, Kopper explained how he had helped run shelter-firm shams for Enron execs, siphoning funds, paying kickbacks, and pocketing millions, reported the Associated Press.

Last week’s plea agreement could be a coup for federal investigators, who have come under increasing criticism for failing to nail any Enron leaders for the fraud that bankrupted the firm.

Kopper “embodies the perfect cooperating witness because he is not viewed by the public as being one of the most culpable defendants. But at the same time he has a vast array of knowledge and can point the government in the right direction,” Robert Mintz, a former Justice Department prosecutor, told the AP.

Kopper, who will be sentenced in April 2003, faces up to 15 years in prison and millions of dollars in fines.

WASHINGTON
Only 16 of 691 high-powered CEOs ordered to personally vouch for the accuracy of their companies’ financial statements failed to meet their August deadline, the U.S. government said last week.

Following the implosions of Enron and WorldCom, the Securities and Exchange Commission (SEC) moved to soothe panicked investors by demanding more accountability from corporate heads.

In June, the SEC acted by demanding a one-time pledge from CEOs tasked with certifying that their books were on the level. Of the 947 largest publicly held companies, 691 had an Aug. 14 deadline. The rest have until December.

After tallying the results, all but 16 of those firms’ CEOs had taken the pledge. The offenders included bad-book poster-firms Adelphia, Enron, and WorldCom, reported the Washington Post.

While SEC spokeswoman Christi Harlan last week said the point of the pledge was “to get the best information possible to investors,” some critics complained that the measure lacked teeth, since no penalties for offending firms have been explained.

While the SEC’s order was a one-time request, the Post notes that the Sarbanes-Oxley reform act, passed by Congress in July, makes such certifications a standing order with every quarterly and annual report.

WASHINGTON
Style guru Martha Stewart last week fended off new allegations of insider trading, denouncing a shareholder suit accusing her and other executives of dumping their own stock before going public with bad news.

Stewart is already in the hot seat for suspicious stock trades made last December, when she sold nearly 4,000 shares of ImClone stock the day before its price crashed on news that a promising drug had been rejected by the government.

Last week, Stewart turned over to Congress nearly 1,000 pages of documents, including emails and phone records, to explain her stock sale. She has denied any wrongdoing, insisting that her broker had a standing order to sell when ImClome dipped below $60, as it did the day she sold.

Investigators say they suspect that ImClome head Samuel Waksal, a friend of Stewart’s, may have tried to tip her off. Waksal, who also has denied any wrongdoing, was indicted earlier in the month for alleged insider trading, and securities and bank fraud.

Stewart’s ImClome troubles compounded last week on news that a shareholder of her firm, Martha Stewart Living Omnimedia, had sued her and other executives for allegedly dumping 5.3 million shares before announcing the congressional probe into Stewart’s ImClome sales.

Investigators say the ImClose news caused Stewart’s price stock to plummet, but executives who cashed out early earned a $79 million profit, reported the Reuters news agency.

A Stewart spokeswoman last week dismissed the suit as “without foundation,” pledging to fight it in court.

NEW YORK
CBS and CNN last week admitted paying for videotapes of al Qaeda chemical tests and weapons training, but insisted that the transferred funds did not fall into the hands of Osama bin Laden’s terrorist network.

The two U.S. TV networks both featured footage from videos spirited out of Afghanistan, where a library of 250 al Qaeda video tapes was found a few weeks ago, reported the Reuters news agency.

While both networks found the tapes through local contacts at about the same time, CNN edged out CBS to screen the scoop, airing footage of chemical weapons tests last Sunday night. CBS followed the next day.

Complaints soon followed on two counts: the graphic footage of dogs being poisoned in chemical tests, and the fact that the networks paid for the tapes without illuminating the nature of their sources.

Both networks last week defended themselves, insisting that the on-tape violence gave gravity to the terrorism threats at hand, and saying that the fees paid for the videotapes were standard and justified.

While CNN initially denied paying for its cache of 64 tapes, the network later admitted giving roughly $30,000 to its source. CBS paid a similar sum for its store of 30 tapes and CD-ROMs, saying a “very nominal, very standard” fee had changed hands.

Media ethicists sided with the networks on the issue, saying the payments were justified as long as the funds did not find their way to al Qaeda — a point on which both networks adamantly agreed.

WASHINGTON
Saudi interests last week reacted angrily to news of a $1 trillion civil suit filed against Saudi groups and three members of the royal family for allegedly bankrolling Osama bin Laden’s terrorist network.

Saudi banks and charities abroad, as well as nationals in the United States, said they will respond by withdrawing funds and filing suit against the U.S. government for demonizing them in the hunt for terrorists.

Of the 19 hijackers involved in the September terrorist attacks, 15 were Saudi nationals.

Last week’s strong words and legal threats reflect heightened tension between Saudi and U.S. interests, though both nations’ governments have yet to get in the fray, reported the Financial Times.

Youssef Ibrahim, a senior fellow at the Council on Foreign Relations, told the Times that at least $200 billion in Saudi funds has been withdrawn from the United States in recent months.

Ibrahim said the exodus will likely accelerate under the weight of the new trillion-dollar suit, which could lead courts to freeze Saudi assets that remain State-side.

That suit, filed by families of those killed in last September’s attacks, piqued the irritation of Saudi lawyer Katib al-Shamri, who last week announced a suit against the U.S. government and media firms.

The promised suit will target the United States for forcing Saudi students to leave U.S. universities after last September attacks, and for arresting and naming Saudis who were later cleared in the terrorist probes.

“We had been waiting to raise funds to hire U.S. lawyers and also for things to quiet down in the United States, but it seems the campaign against Saudi Arabia is continuing,” al-Shamri complained to Reuters. “It is the right time to proceed.”

HARARE, Zimbabwe
Hundreds of white farmers in Zimbabwe were arrested last week for defying government demands that they leave their lands by August 8 — part of a land redistribution program the government says will correct colonial-era wrongs.

Zimbabwe President Robert Mugabe has evicted 2,900 whites from their farms. Those who refuse face up to two years in prison and a fine, reported Britain’s Independent newspaper.

Press reports note that roughly 60 percent of the white farmers have refused to move, resistance that has sparked arrests, beatings, looting, and destruction of their property.

The controversial policy advocated by the Mugabe government comes at a disastrous time, with eviction notices arriving at the same time as planting season. The result: fallow fields and rotting crops at a time when half of the nation’s 12.5 million people face a sever hunger crisis, according to the United Nations.

The Mugabe administration insists that the redistribution policy is needed to correct colonial-era imbalances that left 4,500 whites with one-third of the nation’s farmland and seven million blacks with the rest, reported the Associated Press.

Dispossessed farmers say it may be about something else: political suppression. Evicted farmer Roy Bennett said his loyal black workers, including children, were beaten and tortured by Mugabe’s forces for supporting opposition politicians.

“The crisis in Zimbabwe is not just about the white farming community,” Bennett, a parliamentary member of the Movement for Democratic Change (MDC), told the Independent. “Mugabe’s mobs are attacking thousands of black farm workers who support the opposition MDC, in a systematic attempt to crush the opposition to his rule.”

“There is nobody in their right mind who would oppose agrarian land reform for the betterment of the people. What is being done is not land reform, it is suppression of another view,” Bennett alleged.

WASHINGTON
The U.S. State Department last week released more than 4,000 documents detailing human rights abuses carried out during Argentina’s so-called Dirty War, in which as many as 30,000 dissidents disappeared.

The cables, telegrams, and memos form part of a growing body of evidence charting the deaths and disappearances of leftist critics of Argentina’s military junta, which held control from 1976 to 1983.

The documents, compiled by the State Department and U.S. embassy in Argentina, catalog at least 9,000 of the “disappeared,” who were allegedly kidnapped, tortured, and murdered by the government. Human rights groups say the total is closer to 30,000.

Documents released last week paint an unsettling portrait of Argentina’s military leaders, who met with Washington at the time, and walked away unimpressed by any concern over continuing the alleged abuses, reported the Associated Press.

In a 1976 telegram to Washington, Robert Hill, then the U.S. Ambassador to Argentina, wrote that the nation’s Foreign Minister Admiral Guzzetti “went to the U.S. fully expecting to hear some strong, firm, direct warning of his government’s human rights practices. Rather than that, he has returned in a state of jubilation.”

“His remarks to me since his return are not those of a man who has been impressed with the gravity of the human rights problem as seen from the U.S.,” Hill wrote, but noted that the Argentineans likely heard only what they wanted to hear. “But the results,” Hill added, “nevertheless are the same.”

While the documents do not indicate U.S. complicity in the torture and abuse, they hint that the government failed to put its foot down with sufficient force, noted the head of the National Security Archive, an independent research organization that analyzed the documents.

The legacy of the “disappeared” has haunted Argentine politics for decades. In July, former dictator Leopoldo Galtieri, who ruled in 1981 and 1982, was arrested for allegedly masterminding a death squad responsible for civilian disappearances.

In 1985, leaders from the Dirty War era were imprisoned for human rights abuses. President Carlos Menem pardoned the men five years later, noted the AP.

CHAPEL HILL, North Carolina
The battle over a summer reading assignment at the University of North Carolina (UNC) shifted last week from the campus to the courthouse, with two federal courts rejecting a bid to squelch discussion of a book on Islam.

At the same time, though, North Carolina lawmakers began passing measures meant to punish the school for its summer book selection, Approaching the Qur’an: The Early Revelations by Michael Sells.

The controversy began after UNC-Chapel Hill assigned Sell’s book to its incoming class of 4,200 freshmen and transfer students. Those who objected to the reading were asked to write a one-page essay explaining their reasons.

A conservative Christian group, the Family Policy Network (FPN), sued the university, accusing UNC of using taxpayer funds to conduct the “forced Islamic indoctrination” of students. The group wanted the courts to bar UNC students from discussing the book during orientation this week.

Last week, a federal judge rejected that request. The Fourth U.S. Circuit Court of Appeals followed suit, rejecting a follow-up plea by the FPN, which now says it has no plans to continue appealing the ruling.

Despite its defeats, the FPN may take heart from the North Carolina legislature, whose General Assembly has approved withholding state funds from UNC’s summer reading program because of the Islam assignment, which it equated with religious favoritism.

The state’s House Appropriations Committee last week voted in favor of the measure, which must be approved by the full House and Senate, and then signed by Gov. Mike Easley before becoming law.

UNC-Chapel Hill faculty chairwoman Sue Estroff blasted the lawmakers’ move as an infringement on free thought.

“I suppose evolution will be next,” Estroff told the Associated Press. “I can see them saying we have to teach creationism and the rest of it. To say it isn’t an assault on academic freedom is ludicrous.”

The UNC board of governors, which oversees 16 campuses and are elected by the state’s General Assembly, earlier this month refused to support a resolution avowing the importance of academic freedom.

Some board members told the New York Times that they voted down the measure for fear of inciting lawmakers with budgetary control over the university system.

Special to Newsline from Canadian correspondent Errol P. Mendes

OTTAWA
On the eve of announcing his resignation, Canadian Prime Minister Jean Chrétien urged business leaders in Toronto to restore investor confidence by improving transparency and corporate integrity, thereby securing a strong economy.

Claiming that the idea of integrity is never out of fashion, Prime Minister Chrétien promised he would introduce a significant ethics package for the federal public sector when Parliament resumes to inhibit any repeats of the controversy over awarding of contracts to the governing party’s supporters as well as dubious fundraising by those who are seeking the leadership after his resignation.

However, on August 21, at a Liberal Caucus meeting in Quebec, the PM announced that he would step down in February 2004 to prevent a leadership review battle between himself and ousted former Finance Minister Paul Martin.

He stated that he had announced his resignation to bring back unity to the Liberal Party, end the bitter in-fighting, and protect the integrity of the Office of Prime Minister. However, some supporters of his main rival, Paul Martin, have alleged that the long goodbye is designed to make it harder for Martin to win the leadership after a potentially even more divisive leadership battle with other potential candidates for the PM’s job and the fact that Mr. Martin will turn 65 in 2004.

Most commentators agree that Canada will be replete with lessons about integrity in both the public and private sectors for the next 18 months.

ATLANTA
Rep. Cynthia McKinney (D-Georgia) last week lost her bid to retain her seat in the U.S. House of Representatives following a series of controversies involving ethics and fiery comments on Capitol Hill.

McKinney, first elected 10 years ago, succumbed last week to newcomer Denise Majette in Georgia’s Democratic primary, an open vote that found Republicans biasing the race in Majette’s favor.

McKinney, whose outspoken views in Washington were often welcomed back home, faced a voter backlash after brashly accusing President Bush of profiting from last September’s terrorist attacks, reported the Reuters news agency.

McKinney’s odds worsened last week after newspapers reported that her campaign deluged voters via telephone with recorded endorsements from notables including Bill Clinton, basketball’s Magic Johnson, and actor Robert Redford.

The problem, Reuters noted, was that the endorsements had been recycled from previous campaigns, leaving fingers wagging and voters veering to the side of McKinney’s rival, who won 58 percent of the vote.

Special to Newsline from editor Carl Hausman

The crisis of confidence in the business world continued to dominate Ethics Newsline’s reporting throughout August, as concern over corporate ethics intersected with the monetary consequences of shaking the public’s faith in equity markets.

Our three lead stories this week dealt with continuing fallout from allegations of financial impropriety: the first guilty plea in the Enron fiasco, the rollout of a new system under which corporate CEOs certify their companies’ books, and more troubles for Martha Stewart over allegations of insider trading. Other stories this month dealt with a major whistle-blowing case (Aug. 19), a Canadian official decrying the level of ethics oversight in that nation (Aug. 19), a survey in which many corporate chief financial officers claimed that their bosses had pressured them to cook the books (Aug. 12), and probes of financial dealings at WorldCom and AOL Time Warner (Aug. 5).

Ethical fallout from the war on terrorism continued to make headlines. At the forefront are this week’s items about the controversial airing of apparent al Qaeda videos purchased by major news organizations, and a threatened suit by Saudi interests against the U.S. government and some media outlets. The latter item was in reaction to a suit against Saudi interests covered in the Aug. 19 and Aug. 12 editions of Newsline.

Human rights stories almost always feature a significant ethical angle, and this week we covered news related to the seizure of white farmers’ lands in Zimbabwe, as well as controversy over an alleged go-easy policy by the United States over the “Dirty War” in Argentina. Related stories this month included controversy over the U.S. push to be exempted from certain human-rights prosecutions (Aug. 19), government intervention in a human-rights case against ExxonMobil (Aug. 12), and protest over an allegedly anti-Semitic article printed in an Egyptian paper (Aug. 5).

Technology was prominent this month: On Aug. 19 we covered a protest against Japan’s so-called Juki Net, a high-tech information gathering system, and on Aug. 5 we reported on a bill that would give media companies the right to hack Web sites that had appropriated their content. Also on Aug. 5, we covered a freedom-of-speech suit against a firm that programs Internet filters.

Workplace issues consistently make ethics news, and this month was no exception. Among the top stories: a new survey finds many U.S. firms effectively protect the rights of gay workers (Aug. 19), a South African firm finds it makes economic sense to provide free treatment for HIV-infected workers (Aug. 12), and many employees remain upbeat about their firms despite the recent spate of negative news (Aug. 12).

From the Conference Board:

“More Americans are expressing unhappiness with their jobs, The Conference Board reports in a special survey released today.

“The not-for-profit business group finds growing numbers of Americans are less satisfied with their jobs compared to seven years ago. Only about half of those surveyed say they are happy in their jobs, down from 59 percent in 1995. The decline in job satisfaction is found among workers of all ages and across all income brackets….

“‘The widespread feeling among many Americans that their jobs aren’t providing the satisfaction they once did is likely to be a growing concern for management,’ declares Lynn Franco, director of The Conference Board’s Consumer Research Center.

“‘Workers are least satisfied with bonus plans, promotion policies, and educational training programs. About the only thing workers seem exceptionally pleased about is their commute to work. Even a declining percentage of Americans say they enjoy working with their colleagues — 58 percent compared to more than 64 percent in 1995.’

“Workers aged 35-44 are the least content. Less than 48 percent are satisfied, down from nearly 61 percent in 1995. Older workers, aged 55-64, also express a low level of satisfaction. Only about 48 percent say they are satisfied.

“Not surprisingly, satisfaction tends to increase as income increases…. But in all income areas, satisfaction levels have fallen since 1995.

“Other key findings:

• “…The New England region experienced the largest decline in satisfaction, with only 44 percent of households satisfied with their jobs, compared to 65.4 percent in 1995.
• “Residents of the Rocky Mountain region are the most satisfied, despite a recent decline in the level of satisfaction from 62.7 percent to 57 percent….”

“My kind of loyalty was loyalty to one’s country, not to its institutions or its office-holders.”

– Mark Twain (pen name of Samuel Clemens, U.S. writer, 1835-1910)

Corporate social responsibility is a sham. Business ethics is an oxymoron. Executive integrity is a trick.

In these scandal-blackened days, cynics are all a-blather with such talk. But now we’re hearing it from a disturbing quarter: Business Ethics, a respected 15-year-old magazine widely read by corporate ethics officers.

In the latest issue, editor Marjorie Kelly offers an anguished mea culpa. She ruefully admits the failure of the corporate social responsibility (CSR) movement to prevent the recent corporate scandals. Ending her editorial, she even appears to walk away from ethics itself.

It’s an enticing thesis. But it’s the wrong conclusion.

In a nutshell, here’s her argument:

1. We in the ethics movement focused on CSR — caring for the environment, promoting human rights, taking tough anti-bribery stands — as a way to separate good from bad companies.

2. But Enron and its ilk proved us wrong — talking a great ethics game, winning CSR awards, and then collapsing in a blaze of scandal.

3. Yet unlike prior scandals du jour — frauds concerning defense procurement, Medicare billing, insurance selling, or junk bonds — this is “ethics’ perfect storm,” where “we’re seeing the weakness of the system design itself.”

4. So “all the things CSR has been measuring and fighting for and applauding may be colossally beside the point.”

5. Why? Because CSR cannot compete against greed in the hands of the few powerful elites who benefit from the system, at the expense of the many who get shafted.

6. For that reason, we’re giving up the fight for ethics and turning our attention to systemic reform.

Following her editorial is an italicized note saying that “Business Ethics is laying plans to convert itself into a nonprofit to be called the Economic Democracy Project.”

Engaging though it is, that’s the wrong resolution. The problem lies not with CSR. It lies in the assumption that CSR and ethics are one and the same. They aren’t.

It’s long been true that highly ethical companies — and there are many, especially in the small, privately held arena — sometimes have few resources to spend developing publicly recognized CSR programs. It’s now also obvious that a company with great CSR programs can be fundamentally unethical.

How can that be? Because CSR is but a tiny part of ethics — by my estimates, only about one-tenth. By that I mean that ethics — the practical application of values to decision making — is rooted in the five core moral values of honesty, fairness, responsibility, respect, and compassion. Responsibility is only one-fifth of the mix — and can be further divided into social and individual responsibility. Hence my one-tenth vote for CSR.

Don’t get me wrong: It’s hugely important that corporations practice social responsibility. But if they don’t also inculcate individual responsibility in their executives — not to mention promoting honesty, fairness, and the rest of the core values — there’s no guarantee that they’ll be ethical. These five values are each part of a spectrum: You don’t get the full white light of ethics when any of these components is missing. Do CSR dishonestly, and of course you’ll be unethical.

That’s not to demean Ms. Kelly’s solution. Economic justice is a much-needed antidote. But justice itself (an element of fairness) is only part of the answer. Even when it takes the form of economic democracy — spreading the wealth from the elites to the broader majority — it stumbles over the historical fact that even majorities (as in the Old South, for instance, or in America prior to the environmental movement) can be unethical. Systemic reform and its attendant regulations can encourage ethical behavior. But ethics lies as far beyond regulation as integrity lies beyond mere lawfulness.

And that’s my real concern. I sympathize with the angst at Business Ethics. I applaud Ms. Kelly’s candor in admitting that “Enron fooled us.” But the answer is not to fold up the ethics tent and steal away into the lowlands of economic reform. It lies, instead, in folding up the CSR tent and scaling up into full-blown applications of ethics. That doesn’t happen simply by creating better economic systems — which, however clever, can be outwitted by a slightly more clever villain. It comes by creating ethical executives to run our systems. And since executives, like everyone else, are created by our entire culture (not just by business training or MBA programs), that means seeing ethics as a whole — in schools, communities, governments, families, nonprofits, places of worship.

In the end, there’s no such thing as business ethics. There’s only ethics — applied in special ways to business, yes, but knit seamlessly into the wholeness of the moral consciousness. Which, paradoxically, is why there’s still a need for Business Ethics — a magazine that, Ms. Kelly tells me, her new nonprofit will continue to publish. I’m glad. Try as we might, we can’t avoid the greatest social responsibility of all, which is to focus in the twenty-first century on the ethical mindset that the twentieth century seems to have abandoned.

(c)2002 by the Institute for Global Ethics

“I did not, as a matter of policy, in 1984, ‘85, ‘86, ‘87, ‘88, ‘89, ‘90, ‘91, ‘92, ‘93, ‘94, ‘95, ‘96, ‘97, ‘98, ‘99, 2000, 2001, go to parishes on the occasion of dealing with a priest against whom an allegation of sexual abuse of a child had been made. I see now that that should have been done, but we did not do that.”

– Cardinal Bernard Law of Boston speaking during a deposition over alleged sexual abuse by Rev. Paul Shanley. In videotaped testimony released last week, Law “testified that he had allowed priests accused of sexual abuse — and even those who admitted the abuse — to return to parish ministry without informing parishioners of the accusations or admissions,” according to a report from the New York Times.

WASHINGTON
Relatives of people killed in the September 11 terrorist attacks filed a $100 trillion lawsuit last week against the Sudan government, three Saudi princes, and a host of banks, Islamic foundations, and other defendants accused of bankrolling Osama bin Laden.

The suit, filed by an organization called Families United to Bankrupt Terrorism, targets more than 80 individuals and organizations accused of funding bin Laden’s al Qaeda network, claiming that terrorism’s backers should be held liable for the deaths and destruction they fund.

Terrorists “cannot plan, train, and act on a massive scale without significant financial power, coordination, and backing,” the lawsuit states. “By taking vigorous legal action against the financial sponsors of terror, the plaintiffs will force the sponsors of terror into the light and subject them to the rule of law.”

Lead lawyer Allan Gerson said those sponsors include members of the Saudi royal family, seven banks, and many international charities already under investigation by the U.S. government, reported the Washington Post.

Gerson was instrumental in brokering a tentative $2.7 billion settlement with the Libyan government over the 1998 bombing of Pan Am Flight 103 over Lockerbie, Scotland, notes the Post.

While the plaintiffs acknowledge that they face long odds, they say the lawsuit is their only means of avenging the loss of their loved ones — and the best means of drying up funds for future terrorism.

“It’s not the money. We want to do something to get at these people,” Irene Spina, whose daughter, was killed in the World Trade Center, told reporters. “There’s nothing else we can do.”

Matt Sellitto, whose son also died in the World Trade Center, agreed. “We have to stop the terrorists,” Sellitto told the Post. “And one of the surest ways of stopping them is stopping their access to money.”