Where’s the Line ?

Writing on the Boston College Center for Corporate Citizenship website, Executive Director, Bradley K. Googins, finds that, what with the meltdown in finance, corporate social responsibility is at a crossroads.

“It is clear the failure of an unregulated financial system that almost brought the house down will no doubt be followed by aggressive legislation and regulation as an antidote to calm the fears,” writes Googins. “Already there have been discussions by congressional leaders and others about using this new window to mandate new measures to address climate change, implement safeguards for food, toys and prescription drugs from China, and expand health care insurance mandates.”

He goes on to say: “So here we are at a crossroad for capitalism and corporate citizenship. The trust in a self-regulating system has been lost and the role of lobbying by the business community has been put in a very different light.”

“However, equally dangerous might be a swing of the pendulum too far toward regulation and mandates. We know already that regulations can serve as a disastrous drag on innovation and markets.”

How can business avoid draconian regulations that could stifle growth? Googins offers the following:

• Engage in “a very active dialogue in the business community, and between the business community and those of government and civil society.”
• “Create a new form of global capitalism that reflects blended values with a new respect for the role of government in providing a stronger oversight that its citizens can trust will ensure their interests are protected.”
• Restore “faith to damaged and disillusioned employees, customers, suppliers and communities… guided by active leadership, and infused with basic virtues such as humility, authenticity and accountability.”

In all, Googin concludes, these should “increase the value of capitalism to realize its potential to create a just and sustainable world.”

What do you think?

Those familiar with the online classified ads site, Craigslist, know that you can get just about anything you want on it. Even naughty things. The site has a whole section dedicated to those advertising “erotic services.” These include escorts, erotic dancers, dominatrixes and sometimes even outright prostitutes.

Until Thursday, Nov. 6, advertising erotic services on Craigslist was free. But, as part of a deal with some 40 state attorneys general trying to crack down on the promotion of illegal activities online, the site has opted to charge a fee for erotic services ads. Craigslist CEO, Jim Buckminster, said the move “raises the accountability for people posting to the category.”

That sounds like a bit of a pipe dream, but the move does come hard on the heels of the rejection by the voters of San Francisco — where Craigslist is based — to decriminalize prostitution.

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A couple weeks ago we reported that at the Nike Women’s Marathon, held October 19 in San Francisco, the training shoe company awarded the first place prize to Nora Colligan of Austin, TX, even though Arien O’Connell, a school teacher from Brooklyn, ran the best time. Nike explained that Colligan was part of its elite group of pros and that the “winner” was to be selected from this group alone. Later, Nike lamely issued a statement saying, in effect, that everyone was a winner.

This didn’t sit very well with BNET readers. In fact, of the 252 people who voted in the poll, 80 percent said that Nike should declare O’Connell the winner.

Nike hasn’t done that. But Nike competitor Reebok has. In a clever bit of public relations bravura, Reebok presented O’Connell with a trophy inscribed with the words “Winner and Heroine of Non-Elite Runners Everywhere,” along with a free pair of shoes each month for a year, T-shirts for the kids in her class, and a $2,500 donation to her school.

Reebok surprised O’Connell by giving her the award at a special ceremony at her Beginning with Children Charter School.

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Working with the Reputation Institute, the Boston College Center for Corporate Citizenship has released a ranking of the top 50 companies in the U.S. “that the public distinguishes for corporate social responsibility.”

The rankings were based on data from the Reputation Institute’s 2008 Global Pulse study, which Where’s the Line? wrote up yesterday. “Although the survey was taken before the Wall Street collapse, the U.S. findings show that corporate governance — ethics and transparency — are increasing in their importance to overall corporate reputation,” Philip Mirvis, senior research fellow for the Boston College Center for Corporate Citizenship, said in a statement.

Who were the Top 50 and how did they score?

1. Google (80.84)1 Google 80.84
2. Campbell Soup (Co. 79.55)
3. Johnson & Johnson (79.46)
4. Walt Disney (79.11)
5. Kraft Foods Inc. (76.89)
6. General Mills (75.96)
7. Levi Strauss & Co. (75.38)
8. UPS (75.15)
9. Berkshire Hathaway 74.99
10. Microsoft  (74.83)
11. Intel (74.67)
12. 3M  (74.66)
13. FedEx (74.65)
14. Anheuser-Busch Cos. (74.58)
15. Sara Lee (74.15)
16. Apple (74.03)
17. General Electric (73.64)
18. Publix Super Markets Inc. (73.56)
19. Honda of America (73.52)
20. Deere & Company (73.41)
21. Adobe Systems (73.39)
22. Xerox (73.18)
23. New Balance (73.13)
24. Toyota Motor Corp. (73.00)
25. Texas Instruments (72.87)
26. Colgate-Palmolive (72.67)
27. Green Mountain Coffee Co. (76.61)
28. Marriott International (72.51)
29. Advanced Micro Devices (72.30)
30. IBM (71.99)
31. The Coca-Cola Company (71.79)
32. Whirlpool Corp. (71.76)
33. Aflac (71.68)
34. Office Depot (71.39)
35. TIAA-CREF (71.32)
36. PepsiCo (71.22)
37. Nokia (71.12)
38. Hewlett-Packard (71.03)
39. Timberland Company (70.98)
40. Eastman Kodak (70.96)
41. Cisco Systems (70.96)
42. Costco Wholesale (70.91)
43. Sun Microsystems (70.70)
44. Lowe’s Cos. (70.54)
45. Walgreen (70.47)
46. Fidelity Investments (70.44)
47. Express Scripts (70.32)
48. Deloitte & Touche (70.12)
49. Dell (70.08)
50. Boeing (69.88)

(Companies were rated on a scale of 0-100.)

The Question: Do you work now, or have you ever worked, at any of these companies? If so, how does the reality inside the company stack up against its public perception?

The Reputation Institute, a New York-based corporate reputation consultancy, has released its list of the world’s “most reputable” companies. The Reputation Institute surveyed 600 companies in 27 countries and rated each according to its RepTrak reputation methodology. The 60,000 people who participated in the study answered questions about a company’s perceived corporate citizenship, its governance and its appeal as a place to work. The companies were scored on a 0 to 100 scale.

The Top 10 Most Reputable

1. Toyota (Japan)
2. Google (U.S.)
3. IKEA (Sweden)
4. Ferrero (Italy)
5. Johnson & Johnson (U.S.)
6. Tata Group (India)
7. Kraft Foods (U.S.)
8. Novo Nordisk (Denmark)
9. Grupo Bimbo (Mexico)
10. Migros (Switzerland)

This intelligence comes to us via Ethics World.

On Oct. 19, Nike ran its fifth annual Nike Women’s Marathon, in San Francisco. Runners raised some $18 million for The Leukemia & Lymphoma Society. The official winner of this year’s run was announced as Nora Colligan, of Austin, TX. Her time? 3:06.

But wait a second. Arien O’Connell, a 24-year-old school teacher from New York City ran the 26.2 miles in just 2:55:11, almost five minutes ahead of Colligan.

So why did Nike proclaim Colligan the winner? Evidently, some marathoners are more equal than others. The race was divided into two groups: the “elite” runners — the ones Nike believed actually had a chance to contend for the blue ribbon — and the schlubs just shuffling and puffing along for charity’s sake. The elites start their marathon some 20 minutes before the riff-raff start theirs.

The fact that school-marm O’Connell beat out the elite Colligan for time is certainly an embarrassing PR situation for Nike, but it also presents the company with an ethical dilemma. In a time-based foot race, the one who crosses the tape in the shortest time is the winner, end of story. Yet it seems that the company had promised a select group of runners that the winner would only be selected from their numbers. The company did attempt a lame pedal-and-fill response, saying that it “recognizes Arien O’Connell as a winner” – though not the winner.

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L’Oreal is sponsoring a new master’s degree program in “law and business ethics” at the University of Cergy-Pontoise in France, according to a recent posting in EthicsWorld.

According the the post, the international cosmetics giant has developed the new graduate degree course in association with France’s ESSEC Business School, the U.K. Institute of Business Ethics and the U.S. Ethics & Compliance Officers Association.

“This is the first diploma of its kind in Europe,” said Emmanuel Lulin, L’Oreal’s director of ethics. “Business ethics is a complex subject which needs to be addressed with humility and determination. The global leaders of tomorrow are those companies who have integrated ethics into their strategic planning but also their every-day business practices.”

But one has to wonder about a company whose advertising is designed to make women feel nervous about their looks endowing business ethics program. Some might think it a form of CSR-washing. Is it? You tell us.

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After reading our two posts soliciting readers to share their ethical lapses, BNETer Trish Harris wrote to “Where’s the Line?” noting that a couple scenarios dealt with the lapser not wanting to appear as a “snitch” or a “rat.” She writes: “Sometimes and in some professions, being a snitch is the ethical thing to do.”

Of course she’s right. In fact, it’s probably the ethical thing to do more often than not when we encounter clear wrongdoing on the part of our peers, as long as our own nefarious self-interest is not the true motive for our whistleblowing — and unless of course you’re in the mafia.

A while back, Trisha penned an article on the topic for the Institute of Internal Auditors (who, by the way are not snitches but rather play an important policing role within organizations). Published in the organization’s magazine, Tone at the Top, “A Call for Character and Integrity,” outlines the seven steps companies need to take in order to foster an atmosphere of “responsibility and accountability:”

1. Set an ethical tone at the top.
2. Promote strong and effective internal controls.
3. Establish a whistleblower policy.
4. Prevent reprisals.
5. Provide ethics and fraud training for staff.
6. Implement a confidential tips hotline.
7. Create a culture of doing the right thing.

Read the rest of “A Call for Character and Integrity” (pdf).

Last week we asked BNET readers to share their ethical lapses and what they learned them. To our surprise, several folks were offended by the very nature of the question, as if we thought ethical lapses were something to be glorified. Writes jwood:

What were you thinking? Having your readers gloat over their unethical exploits? And then select the “best?”

Not at all. In fact, we’re going ask you to rate each of the lapses, asking whether it was “understandable and forgivable,” “at the line,” or “unforgivable.” Here goes.

namfus writes:

Six years ago, I basically allowed my boss to manipulate my performance review and the HR department in order to sack me.

This ethical lapse is...

• understandable and forgivable
• at the line
• unforgivable

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martikirchmer writes:

Some years ago, in the interest of protecting my employees, I was aggressive about reporting my boss every time he bullied my co-workers or staff. He was indeed a bully — everyone agreed (including HR and his boss) but in trying to bring the problem to a head, my actions were not particularly admirable. The story ends with me (voluntarily) leaving. He is still there.

This ethical lapse is...

• understandable and forgivable
• at the line
• unforgivable

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kschroth writes

Our department head (and my boss) was a super slacker. We conducted a cue and eventually after gathering much evidence against him, made a call to the CEO of the company who was out of state. As stated above this was not received well. We were thought of as deserters. In the end, he got sacked, I moved up, managed the department for awhile before the whole company fell in.

Not sure what I DID learn, but I know that wasn’t the right way to handle it, even though it seemed so at the time. Bummer, but in corporate America it is essential to CYA whether a manager or a peon. Someone usually has something brewing. I have since moved to a smaller organization and LOVE IT!!

This ethical lapse is...

• understandable and forgivable
• at the line
• unforgivable

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And I’m not squeaky clean, either. Here’s mine:

A long, long time ago I was employed at a fashionable retail shop. I got along well with the manager, but one day found out he had been deceptive with the absentee owners — he had a number of times closed the store a couple hours early so that he could see a movie…

The ethical response would have been to call the owner and tell him. But I didn’t want to seem like “a rat.” A few months later, we had a bit of a falling out over a questionable firing. At that point I saw an opportunity for advancement and called the owner and told him about the manager’s movie-going antics, leaving a message.

It all backfired, of course. For starters, I immediately felt awful about being a rat. Then, as it turned out, the owner had already got wind of the manager’s transgression and given him a proper dressing down but forgave him because he was an otherwise competent manager and a terrific sales person. In fact, the owner saw through my little game and almost fired me for my “disloyalty” to my manager. Hard feelings; damaged relations all around.

Lesson learned: It always comes back to bite you.

This ethical lapse is...

• understandable and forgivable
• at the line
• unforgivable

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Lastly, CanadianBusine offers up a current events scenario:

We needn’t look far to ferret out some lessons. Here are two examples:

$23 billion of American taxpayer money lost, stolen or improperly accounted for in Iraq. Complete and utter disregard for the most basic procurement and supply chain management guidelines and then punishment of those who seek to bring this to light.

Sub-prime mortgage meltdown. Plenty of blame being leveled at the government for telling the banks to offer loans to squishy buyers. However, no one forced any bank to violate basic mortgage lending guidelines and then make millions in bonuses from selling this junk paper to equally short-sighted institutional investors.

This ethical lapse is...

• understandable and forgivable
• at the line
• unforgivable

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Is your ethics training effective?

That’s the question that my confrere, Lauren Bloom, an ethics trainer and the author of the eponymous blog, “Lauren Bloom’s Blog,” asks. She says:

In the wake of the subprime mortgage mess, a lot of companies will probably decide that it’s time to offer ethics training to their employees. Here’s hoping that they do it well, and for the right reasons. It’s extremely important to train employees in business ethics, but the training has to be effective if it’s going to be worth the time and trouble invested in it. Effective ethics training is interactive, specific to the ethical issues that are most relevant to the company, understandable and positive, and yields measurable results.

One wonders, though, just how the effectiveness of a company’s ethics training can be quantifiably measured. (If you have a clue, please share it with your fellow BNETers in the comments.)

In my professional, corporate career, I’ve been through a few “ethics courses” but these were mostly taken online and included rather simplistic, multiple choice questions with common sense answers.

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Have an ethics training horror story? Share it.