June 29, 2009, might go into the annals as a big day in the history of business ethics. Right on top of many US news sites, we learn, first, that Bernie Madoff got his whopping 150 years sentence and, second, the US supreme court ruled in a landmark case in favor of 18 white firefighters who were suing their employer for what is often called ‘reverse discrimination’.
The Madoff case is in some ways your run-of-the-mill textbook case for unethical behavior in business – if it were not on such a biblical scale and in these dire times. And for a change not only hitting poor or middle class people but the wealthy. For us this example of fraud and theft points to the clear limits and boundaries of business ethics: the strong approach to deregulation and self-regulation of the financial industry in the US (and elsewhere) in the past has delegated a lot of ethical issues into the realm of the voluntary.
Funnily, they interviewed Harry Markopolos, a stockbroker, recently on 60 Minutes who as early as in the year 2000 had filed a complaint to the Securities and Exchange Commission (SEC), the self-regulatory body overseeing Wall Street. Four more he filed over the years, mostly because he was mad at Madoff as a competitor who offered these fairy tale returns. Remember, this was the time of Enron etc, where one would have expected the SEC to take complaints about unethical behavior seriously. Based on mathematical modeling Markopolos ("It took me five minutes to know that it was a fraud. It took me another almost four hours of mathematical modeling to prove that it was a fraud.") could prove back then what the SEC never took serious. Madoff was just too respected and too powerful on Wall Street for the SEC to even daring to question his practices. It shows that ethical behavior in business still is very dependent on strong institutions, independent regulators and, no less, skilled and professional oversight. The ‘Case Madoff’ in that sense is in fact a ‘Case SEC’.
The second incident is equally important and will have massive consequences. The case is about the fire department of New Haven (a small town north of New York City) which had made their firefighters pass a test as the basis of promotion. None of the black firefighters passed the test. Out of fear to appear racist, the City of New Haven then refrained from promoting all the (white) guys who did pass. These 18 white guys (one of them Hispanic) went to court and now finally won fighting their case through all the levels.
For a long time, the business ethics literature has actually addressed these issues of retributive justice in rather favorable terms. Because of past injustices against a particular group, that group should now receive preferred treatment. The black guys, so the argument goes, did not fail the test for reasons in their control, but because they belong to an ethnic group, which in the US still struggles in education, family stability and other factors which make people successful. The problem here is though that in doing so, you discriminate against other groups in a similar way. The fact that a court now rules against this in some ways is a sea change in the way we will deal with affirmative action in years to come. The ruling will have massive implication for business too, as it is based on laws that apply not only to the public sector. It will surely lead to many complex discussions and tricky decisions in business.
Monday, June 29, 2009
Friday, June 19, 2009
Ethics in the fashion industry
Most of the stuff that gets written about ethics in the fashion industry tends to focus either on fur, or on its effects on consumers, and especially the damage it can do to the self-esteem and body image of young girls. Those who work in the industry tend to get pretty ignored by the ethics community. Outside of the well-publicised supermodel tantrum, or the occasional rumour of drug taking, the working lives of models are essentially off-stage and out of sight. Most of us probably assume that the fantastic clothes, the famous faces, the glamorous locations, and the stratospheric salaries make modelling one of the best jobs in the world.
However, the release of the documentary Picture Me, which is just hitting the festival circuit now, looks set to lift the lid on the darker side of the modelling world. Made by Sarah Ziff, a model turned documentary maker, and co-director Ole Schell, the film chronicles the high pressure, exploitative, and sometimes abusive environment faced by professional models. It also, perhaps more controversially, provides us with a glimpse into the highly sexualized, predatory pressures that models experience, even as young teenagers. The film is already getting noticed, probably because its maker is already a familiar face in the fashion industry. The UK's Observer newspaper ran a feature on it a couple of weeks ago which ended up on the cover of their magazine. The doc also won best film and best fashion film at the Milan International Film festival recently.
Ziff is clearly a true industry insider, having been discovered on the street by a photographer when she was 14, and then going on to become the face of numerous global brands such as Calvin Klein, Tommy Hilfiger, Dolce & Gabbana and Gap. In her time, she has worked for all the top designers including Marc Jacobs, Stella McCartney, Louis Vuitton, Gucci, and Chanel. Along the way, she obviously made a huge amount of money. But these experiences also provided her with extraordinary access to life behind the scenes of the fashion industry.... and an opportunity to tell the story of what goes on backstage in all its warts and all glory. By putting cameras in the hands of the models themselves, she was also able to give voice to those who, as the film’s myspace page puts it, ‘are often seen, but rarely heard’. As such, the film presents a sincere and engaging look inside the working life of models, documenting both the rewards and sacrifices that young women have to make.
In addition to Ziff and her fellow models, the film also features appearances and in-depth interviews with noted photographers and designers. By stitching these various accounts together Ziff and Schell create a frank account of various ethical issues confronting the industry such as age, anorexia, working conditions … and of course the exorbitant salaries earned by top models. It also brings to light the surprising lack of regulation and protection governing the industry.
In fact, the film itself is part of a nascent attempt by some models to bring greater visibility and protection into modelling. As the Observer article mentions, a handful have started writing behind-the-scene blogs chronicling their daily lives in intimate detail. A successful 2007 campaign by two models, Victoria Keon-Cohen and Dunja Knezevic, also led to the opening up of the actor’s union Equity to catwalk and photographic models for the first time.
We're hoping the film makes it and gets a wider release - it certainly should do given some of the star power behind it, even if it was made on a shoestring budget. It's not so much that no one knew there was all kinds of dodgy stuff going on in the modelling industry. But by putting it up there on the screen in such an honest and intimate way, Ziff looks to be making a valuable contribution to the debate.
Tuesday, June 2, 2009
Ethics pledges: If it's good enough for Harvard....
A few weeks ago we wrote about the growing phenomenon of ethics pledges at business schools, and its likely impact on avoiding the kinds of ethical problems involved in the current financial crisis. Several people have now been pointing us to a recent article in the New York Times on an Ethics Oath instigated at Harvard Business School. As a voluntary, student-led initiative, this is pretty much in line with the vogue for pledges in the US that we discussed in the earlier posting. That it has happened at Harvard, however, appears to be news to the NYT, presumably because this is about as deep into the mainstream MBA establishment as you can get. The logic here being: if it's good enough for Harvard, it'll probably be good enough for any self-respecting business school.
Certainly the current financial problems have focused a few more minds on issues of ethics and responsibility. And as the NYT suggests, the new generation of MBA students tends to be interested in making a difference just as much as making a buck .... or at least some of them do. It is notable that despite the hoohaw about the Harvard Oath, less than a quarter of the graduating class actually signed it this year, so we are not exactly talking about a majority of students. Still, a sizeable minority represents something of a shift from a decade or so ago when these kinds of commitments would have been laughed out of the class at most big MBA schools. Ethics pledges like these may not be for everyone, ut they do signify how far things are changing ... and how far they still have to go before a serious commitment to management integrity goes mainstream.
Certainly the current financial problems have focused a few more minds on issues of ethics and responsibility. And as the NYT suggests, the new generation of MBA students tends to be interested in making a difference just as much as making a buck .... or at least some of them do. It is notable that despite the hoohaw about the Harvard Oath, less than a quarter of the graduating class actually signed it this year, so we are not exactly talking about a majority of students. Still, a sizeable minority represents something of a shift from a decade or so ago when these kinds of commitments would have been laughed out of the class at most big MBA schools. Ethics pledges like these may not be for everyone, ut they do signify how far things are changing ... and how far they still have to go before a serious commitment to management integrity goes mainstream.
Friday, May 22, 2009
Ethics and MP's expenses: storm in a (claimable) teacup?
Crane and Matten have been in the UK this week, and the big issue absolutely dominating the media has been that of the expense claims of the country's Members of Parliament (MPs). The press and TV have been all over this one like a bad rash, and don't look ready to letup soon. Now no one likes to see elected politicians misappropriating the public's hard earned money - and Britain has already seen itself slipping down the greasy poll of the corruption perception rankings as we mentioned last autumn. But over the course of the past few weeks the media storm has relentlessly criticised politicians from across the political spectrum for abusing the public's trust to such a degree that we've already seen one senior figure resign (the Speaker of the House of Commons), various politicians have had their knuckles rapped and have promised to repay their overenthusiastic claims, and party leaders have been scrabbling for the moral high ground in trying to instigate new systems of control.
When all is said and done, there is little evidence in all this that any of the politicians involved have actually broken any rules; in fact, it would appear that in many instances, their claims were not only approved, but actively encouraged by administrators. This has all been going on for years without anyone getting in much of a commotion about it. Besides, the padding of expenses is a problem that is hardly unique to poilitical circles - the private sector has just as many problems to deal with, and the media industry itself is hardly whiter than white. So is this all a fuss about nothing? Not exactly. There are some real issues here, especially around how to maintain public trust. There are also many lessons to be learnt about business ethics too - particuarly in terms of the limits to compliance systems in managing ethics, and the importance of getting to the deeper problems of how institutions are governed. Some of these points are dissected nicely in some recent posts on the Added Values blog by the folks in the Professional Ethics Network at the University of Leeds. They also link to a nice little interview clip from everyone's favourite Twitter-er Stephen Fry.
Another way of looking at this is to try and understand why such problems have gone on for so long, and how such a culture of corruption ever managed to get cemented into the heart of government in the UK. One of our favourite concepts in exploring institutionalised bad behaviour is "rationalization tactics", as described by Anand et al in the Academy of Management Perspectives. It doesn't take much effort to see in the case of MP's expenses some clear examples of how processes such as incrementalism, socialization, and cooptation have successively socialized MPs into unethical behaviour ... and how rationalizations such as appealing to higher loyalties and balancing the ledger have given them the kinds of excuses that deny wrongdoing and keep everyone in a state of denial. Of course, if we follw this path, the obvious solution that comes to mind therefore, is a fundamental culture change, a new broom in the dusty cupboards of Parliament. But for that, it's going to take a whole lot more than the rhetoric we've heard so far.
When all is said and done, there is little evidence in all this that any of the politicians involved have actually broken any rules; in fact, it would appear that in many instances, their claims were not only approved, but actively encouraged by administrators. This has all been going on for years without anyone getting in much of a commotion about it. Besides, the padding of expenses is a problem that is hardly unique to poilitical circles - the private sector has just as many problems to deal with, and the media industry itself is hardly whiter than white. So is this all a fuss about nothing? Not exactly. There are some real issues here, especially around how to maintain public trust. There are also many lessons to be learnt about business ethics too - particuarly in terms of the limits to compliance systems in managing ethics, and the importance of getting to the deeper problems of how institutions are governed. Some of these points are dissected nicely in some recent posts on the Added Values blog by the folks in the Professional Ethics Network at the University of Leeds. They also link to a nice little interview clip from everyone's favourite Twitter-er Stephen Fry.
Another way of looking at this is to try and understand why such problems have gone on for so long, and how such a culture of corruption ever managed to get cemented into the heart of government in the UK. One of our favourite concepts in exploring institutionalised bad behaviour is "rationalization tactics", as described by Anand et al in the Academy of Management Perspectives. It doesn't take much effort to see in the case of MP's expenses some clear examples of how processes such as incrementalism, socialization, and cooptation have successively socialized MPs into unethical behaviour ... and how rationalizations such as appealing to higher loyalties and balancing the ledger have given them the kinds of excuses that deny wrongdoing and keep everyone in a state of denial. Of course, if we follw this path, the obvious solution that comes to mind therefore, is a fundamental culture change, a new broom in the dusty cupboards of Parliament. But for that, it's going to take a whole lot more than the rhetoric we've heard so far.
Friday, May 15, 2009
Are we living in The Age of Stupid?
Here is another guest-blog from our friend and colleague Laura. Exciting news about new releases from the world of Celluloid. Timely to accompany the Cannes Festival right now. Enjoy!
_______________________________________________________
I, like Crane & Matten, like to use film and literature to explore our subject in alternative ways which sometimes capture the imagination more profoundly than the average media report or academic case study. Business Ethics films seem to me to fall into two simple categories, the documentary-type film on the one hand and on the other the dramatisation of either a real or realistic example of ethically dubious business-related behaviour. In the documentary form I would include Al Gore’s Inconvenient Truth, Leonardo di Caprio’s The 11th Hour, Supersize Me, The Corporation, WalMart: The High Cost of Low Price, Orgasm Inc. and the ENRON documentary, The Smartest Guys in the Room. The contrasting dramatised approach includes Erin Brockovich, Blood Diamond, The Insider, Rogue Trader, There will be Blood, Michael Clayton and Fast Food Nation.
Each of these two approaches has their advantages and limitations of course. The documentary perspective can comfortably contain more factual information but can err on the preachy side – maybe that’s why the celebrity association seems to pep things up a little and hold interest. And even if you are basically in agreement with the premise, you can’t escape the certain knowledge that the version of events you are getting is clearly aiming to get one side of the story firmly across. This doesn’t move the arguments tremendously far forward but can focus the mind and provide ammunition for debate. The dramatisation approach to Business Ethics films are easier-going to watch in a sense, though of course the credibility of the message can get subsumed in the dramatic action.
A hybrid approach, with the detail and credibility of a documentary but the entertainment factor of a dramatisation, has potential to profit from the best of both worlds. In March a new film released in the UK managed to do just that and combine the documentary and the dramatic styles with considerable success to bring home the runaway catastrophe of climate change with a punch, and miraculously without making you feel like you have been lectured at.
The Age of Stupid is directed by Franny Armstrong and truly is a film which reaches parts you had forgotten you had. It stars Pete Postlethwaite (seems every film needs a celebrity, but then he is a brilliant actor) as an archivist living alone in 2055 in a world decimated by climate change. As he mutters to himself and his computer screen he reviews footage from 2008 and ponders why, when we had the chance, we didn’t do anything about the environmental damage we were causing.
The documentary aspect comes through as the archivist follows several real stories from around the world: an octogenarian French mountain guide who has watched his beloved landscape change; an ambitious entrepreneur starting a low-cost airline in India and seeking the advantages there which the developed world has long enjoyed; a Shell oilman from New Orleans who sees no real contradiction between a life spent in the oil industry and the horrendous damage caused by Hurricane Katrina, in which he helped to save over 100 people’s lives; a young Nigerian woman who is doing all she can to earn money to put herself through medical school and become a doctor (including fishing in the oil-polluted waters and washing fish with ‘Omo’ to make them ‘edible’); two Iraqi refugee children looking for their brother; and an English wind farm developer trying to overcome opposition in the form of formidable middle aged, middle class locals (he loses).
These real lives show intriguing, sometimes heart breaking perspectives on the fallout of climate change, almost all of which have some connection to corporations (Shell in particular come under the spotlight) and their activities, so useful business ethics material as well as a straight education on the complexity we cause by messing with the environment. For me what it did spectacularly well was bring home the point that climate change is not something for the younger (or future) generation to worry about – it is us, now, of all ages who need to get a grip. In fact, probably, the older we are, the more culpable, with our high cost, high energy consuming lifestyles and endless rooms of stuff we could easily live without. It is the oil man who points out that people looking back on our era will be bound to call it the Age of Stupid, for our failure to act on the damage we are causing.
The film is timed explicitly to galvanise action prior to the United Nations Climate Change Conference in December 2009 in Copenhagen. This is the follow-up to the Kyoto Protocol and the Bali Roadmap. Director Franny Armstrong puts it quite plainly herself “Copenhagen is our last chance”. Certainly, it will be an incredibly important political, social, environmental and economic event, and one in which we will see quite clearly the metal of our respective politicians. Legislation is at last being looked to as part of the solution, as we have seen in the Climate Change Act 2008 in the UK and may yet witness from the Climate Change Bill currently being debated in the House of Representatives in the US. This Bill, going under the official title of the American Clean Energy and Security Act of 2009 , should be considered by the Energy and Commerce Committee by the end of May 2009. The time for tackling climate change could hardly be any more ‘now’.
I –seriously – spent the next few evenings after seeing The Age of Stupid sitting in an unheated, darkened house desperately trying to save energy. The film is that moving and effective at waking you up to the situation we are in. Happily spring is here in the UK so I no longer need to take quite such chilling steps to do my bit. But at the risk of sounding evangelical (as if I haven’t already!), I would say – go and see the film, or better still arrange for it to be shown at your workplace/university/school/arts centre or wherever. If we are quick, we may just manage to be not as stupid as we look.
Laura J. Spence, Director, Centre for Research into Sustainability, Royal Holloway, University of London, UK. www.rhul.ac.uk/management/cris
_______________________________________________________
I, like Crane & Matten, like to use film and literature to explore our subject in alternative ways which sometimes capture the imagination more profoundly than the average media report or academic case study. Business Ethics films seem to me to fall into two simple categories, the documentary-type film on the one hand and on the other the dramatisation of either a real or realistic example of ethically dubious business-related behaviour. In the documentary form I would include Al Gore’s Inconvenient Truth, Leonardo di Caprio’s The 11th Hour, Supersize Me, The Corporation, WalMart: The High Cost of Low Price, Orgasm Inc. and the ENRON documentary, The Smartest Guys in the Room. The contrasting dramatised approach includes Erin Brockovich, Blood Diamond, The Insider, Rogue Trader, There will be Blood, Michael Clayton and Fast Food Nation.
Each of these two approaches has their advantages and limitations of course. The documentary perspective can comfortably contain more factual information but can err on the preachy side – maybe that’s why the celebrity association seems to pep things up a little and hold interest. And even if you are basically in agreement with the premise, you can’t escape the certain knowledge that the version of events you are getting is clearly aiming to get one side of the story firmly across. This doesn’t move the arguments tremendously far forward but can focus the mind and provide ammunition for debate. The dramatisation approach to Business Ethics films are easier-going to watch in a sense, though of course the credibility of the message can get subsumed in the dramatic action.
A hybrid approach, with the detail and credibility of a documentary but the entertainment factor of a dramatisation, has potential to profit from the best of both worlds. In March a new film released in the UK managed to do just that and combine the documentary and the dramatic styles with considerable success to bring home the runaway catastrophe of climate change with a punch, and miraculously without making you feel like you have been lectured at.
The Age of Stupid is directed by Franny Armstrong and truly is a film which reaches parts you had forgotten you had. It stars Pete Postlethwaite (seems every film needs a celebrity, but then he is a brilliant actor) as an archivist living alone in 2055 in a world decimated by climate change. As he mutters to himself and his computer screen he reviews footage from 2008 and ponders why, when we had the chance, we didn’t do anything about the environmental damage we were causing.The documentary aspect comes through as the archivist follows several real stories from around the world: an octogenarian French mountain guide who has watched his beloved landscape change; an ambitious entrepreneur starting a low-cost airline in India and seeking the advantages there which the developed world has long enjoyed; a Shell oilman from New Orleans who sees no real contradiction between a life spent in the oil industry and the horrendous damage caused by Hurricane Katrina, in which he helped to save over 100 people’s lives; a young Nigerian woman who is doing all she can to earn money to put herself through medical school and become a doctor (including fishing in the oil-polluted waters and washing fish with ‘Omo’ to make them ‘edible’); two Iraqi refugee children looking for their brother; and an English wind farm developer trying to overcome opposition in the form of formidable middle aged, middle class locals (he loses).
These real lives show intriguing, sometimes heart breaking perspectives on the fallout of climate change, almost all of which have some connection to corporations (Shell in particular come under the spotlight) and their activities, so useful business ethics material as well as a straight education on the complexity we cause by messing with the environment. For me what it did spectacularly well was bring home the point that climate change is not something for the younger (or future) generation to worry about – it is us, now, of all ages who need to get a grip. In fact, probably, the older we are, the more culpable, with our high cost, high energy consuming lifestyles and endless rooms of stuff we could easily live without. It is the oil man who points out that people looking back on our era will be bound to call it the Age of Stupid, for our failure to act on the damage we are causing.
The film is timed explicitly to galvanise action prior to the United Nations Climate Change Conference in December 2009 in Copenhagen. This is the follow-up to the Kyoto Protocol and the Bali Roadmap. Director Franny Armstrong puts it quite plainly herself “Copenhagen is our last chance”. Certainly, it will be an incredibly important political, social, environmental and economic event, and one in which we will see quite clearly the metal of our respective politicians. Legislation is at last being looked to as part of the solution, as we have seen in the Climate Change Act 2008 in the UK and may yet witness from the Climate Change Bill currently being debated in the House of Representatives in the US. This Bill, going under the official title of the American Clean Energy and Security Act of 2009 , should be considered by the Energy and Commerce Committee by the end of May 2009. The time for tackling climate change could hardly be any more ‘now’.
I –seriously – spent the next few evenings after seeing The Age of Stupid sitting in an unheated, darkened house desperately trying to save energy. The film is that moving and effective at waking you up to the situation we are in. Happily spring is here in the UK so I no longer need to take quite such chilling steps to do my bit. But at the risk of sounding evangelical (as if I haven’t already!), I would say – go and see the film, or better still arrange for it to be shown at your workplace/university/school/arts centre or wherever. If we are quick, we may just manage to be not as stupid as we look.
Laura J. Spence, Director, Centre for Research into Sustainability, Royal Holloway, University of London, UK. www.rhul.ac.uk/management/cris
Subscribe to:
Posts (Atom)