The Business Ethics Blog

Food isn’t as simple as it used to be. Once upon a time, a bottle with a picture of an apple on it was pretty likely to contain apple juice…you know, the juice of an apple. A real apple. One of those things that grows on trees. These days, the bottle might contain apple juice, or mostly apple juice, or apple-flavoured synthetic apple beverage. Plus, once upon a time, people (supposedly) knew which foods were (supposedly) good for them, because products were simple. Apples were apples. Beef was beef. Butter was butter. Now, apples can be genetically modified, beef can be mechanically separated, and butter-like products may-or-may-not contain partially hydrogenated vegetable oil. Modern food labelling seeks to help consumers navigate these murky waters. Just how effective is it?
Here’s the story from Reuters: Americans puzzled by food labels

Most Americans read food labels to help them decide what to buy but few people actually understand what they’re reading or consuming, according to two U.S. studies published on Tuesday.

What sort of information confuses consumers?

Overall, patients correctly answered 69 percent of the questions, but they had problems understanding serving sizes and extraneous information and completing simple calculations.
For instance, only 32 percent of patients could correctly calculate the amount of carbohydrates in a 20-ounce bottle of soda that had 2.5 servings in the bottle, and only 23 percent could determine the amount of net carbohydrates in a serving of low-carbohydrate spaghetti.

This is pretty bad. On one hand, it speaks to the functional illiteracy (and innumeracy) of a significant portion of the American (and, I’m guessing, Canadian) population. But it also means that a significant number of consumers just aren’t benefiting from the additional information that food packagers are required to provide. Think about what this means beyond food labels: the results of these studies probably also imply that roughly the same percentages of people aren’t understanding the specs for their cars (or their car loans), mortgage documents, safety instructions on power tools, etc. If autonomous choice requires full information, so much for consumer autonomy.

Roughly, this implies 3 options:

1) Work hard at improving literacy rates, especially when it comes to reading consumer labels. (Just whose responsibility is that, anyway?)
2) Give up on labels. (“They don’t work, so why bother?”)
3) Shrug our shoulders and say, “No system is perfect. Some understanding is better than none.”

Discuss!

Footnote:
In an article forthcoming in the Journal of Business Ethics, Melissa Whellams and I argue that there’s no ethical obligation for corporations to label Genetically Modified foods. (You can read the abstract here.) One of the things we point out (and we’re not the first to say this) is that simply providing labels doesn’t necessarily mean that people will then be able to make good choices about what they eat. If people don’t understand what a calorie or a gram of carbohydrate means, how on earth are they going to understand what it means when the label says “This product may contain Genetically Modified ingredients”? If the GM food issue interests you, go back to the list of options above, and go through them again….

[update: A loyal blog reader tells me that Oprah Winfrey recently dedicated a show to reading food labels. Given that she’s got something like 10 million viewers each week, that’s a pretty significant contribution.]

Working Mother magazine has put together their 21st annual list of the 100 Best Companies (which they also refer to as the most “family-friendly” companies in America).

Programs we could only imagine a few years ago—16 months of maternity leave, free backup care, phase-back programs, $10,000 in adoption reimbursement—are now a reality at many of our Working Mother 100 Best Companies. In selecting this year’s winners, we gave special weight to leave policies, because it’s critical for a mother to be able to stay home as long as possible with her newborn without suffering professionally.

WM lists their top 100 in alphabetical order, so I can’t tell you who topped the list. Among the welll-known companies included, however, are Aflac, Allstate, American Express, and Avon. There are also a few surprises (i.e., companies that have overall various kinds of image / social responsibility problems) such as Dow Corning, Ford, GlaxoSmithKline, and Microsoft.

What is the WM list based on? There isn’t a lot of specific information, but according to WM’s Methodology page:

Seven areas are measured and scored: workforce profile, compensation, child care, flexibility, time off and leaves, family-friendly programs and company culture.

Helpfully, the list also provides access to extra information about just what makes each company a good place for working moms.

Interestingly, BusinessWeek leaves out the whole “mom” angle, and entitles their version of the story List of 100 top places for women to work (so, is that women generally? Are they trying to keep the headline short, or just assuming that all women are current-or-potential moms?)

(Thanks to Feministing for the story.)

I can see it now, the smoke coming out of the ears of the most strident anti-corporate critics, as they try to make sense of this one.

Wal-Mart is an evil, low-paying, mom-and-pop-store killing, culture-dumbing, hegemonic corporate monster, right?

And drug companies are money-hungry giants that care more about their profits than they do about the health, well-being, & financial status of their customers, right?

So…what are we supposed to think when evil Wal-Mart takes on the evil Drug Companies?

Here’s the story, courtesy of the Detroit Free Press: Wal-Mart to Cut Prices for Generic Drugs

Wal-Mart, the world’s largest retailer, plans to slash the prices of almost 300 generic prescription drugs, offering a big lure for bargain-seeking customers and presenting a challenge to competing pharmacy chains and makers of generic drugs.
The drugs will be sold for as little as $4 for a month’s supply and include some of the most commonly prescribed medicines….

Now, Wal-Mart claims that it sees the drug companies as “partners” in this endeavour.

…Wal-Mart is working with the 30 participating drug companies to help them be more efficient. “We are working with them as partners. We are not pressuring them to reduce prices….”

Uh-huh. I’ve blogged before about the love-hate relationship that many suppliers have with Wal-Mart. The point is, Wal-Mart is here (again) using its economic might and savvy supply-chain management techniques in a way that is genuinely beneficial…not to shareholders of pharma companies, but to the working-class folks who make up the bulk of their customer base. Now, I have nothing against the shareholders of pharma companies, nor do I begrudge them their stock dividends. The point is that a paradigm-bending company like Wal-Mart shifts benefits around within an economy. Wal-Mart makes some people better off, and others worse off. Should you be a fan of Wal-Mart? That depends on some combination of a) whether you think Wal-Mart’s net impact is positive, and b) whether you think the harms and benefits of Wal-Mart are appropriately distributed.

Hmmm….so, first Wal-Mart goes organic, and now they’re trying to do something the U.S. government has been unable to do, namely get pharmaceuticals into the hands of people who really need them, at a reasonable price. What next? It looks like it’s going to get harder and harder to find reasons to hate the Beast of Bentonville.

Here’s an ethical issue that doesn’t make it into a lot of textbooks: what names are ethically permissible for your product? A beverage company has decided to name its “energy drink” after a dangerous drug. Here’s the story: ‘Cocaine’ drink claims to be real thing

Its maker claims the title is “a bit of fun” but critics slammed the technique as a cynical ploy which could tempt young people into using drugs.
The drink’s inventor, Jamie Kirby, said: “It’s an energy drink, and it’s a fun name. As soon as people look at the can, they smile.”
He claims Cocaine is “350 percent stronger than Red Bull” but that people do not experience the “sugar crash” or jitters that he says some of the other energy drinks can produce.

Here, again, is one of those stories that makes my vision go all grey.
Are young people really likely to use an energy drink as a “gateway drug”? That’s hard to believe. (“Say, it’s so great in a can, maybe I should try freebasing!”)
On the other hand, is promoting a product that could even conceivably lead anyone to attribute a remotely positive connotation to the term “cocaine” an admirable business strategy? Don’t think so. Is it 100% cool to market a drink named after a drug that has ruined millions of lives? Probably not. In fact, it probably means you’re the kind of person who thinks that “hey, as long as it’s legal, and as long as no one is being directly harmed (probably), then it’s a great way to make a living.”

As a frame of reference, are there other products that have dubious names? I suppose Iceland’s Black Death schnapps might be a contender. Though (given that the real Black Death — i.e., the Black Plague — is a few hundred years past), I think the Icelanders are just showing a sense of humour regarding what is, by most accounts I’ve read, a horrible-tasting beverage. See also Bong Water (a carbonated citrus drink made by Real Things Distributing), and Pimp Juice. (Sort of a pattern, there, with the energy drinks…) Then there was also Ice-T’s (in)famous rap tune, “Cop Killer” (1992), though I guess the issue there wasn’t so much the name of the song as its content. There was also Porn Star clothing.

Of course, Cocaine (the energy drink) is aimed at a young audience…generally, that’s who energy drinks are aimed at (which is odd, when you think about how much energy young folks have compared to older folks. Anyway…) So, the fact that Cocaine (the energy drink) is aimed at a younger audience is part of the problem. When you market to kids, you bear extra responsibilities. And notice that almost all of the products with controversial names (at least, the ones I can think of) are aimed at youth. (Picture it: “Whoah! If I wear a t-shirt that says Cocaine on it, that’ll really piss off mom & dad!”)

Where does that leave us? I don’t know. I suppose as long as there are rebellious teenagers, there will be someone who wants to make money off them by giving their product a naughty name. Business students ought to be encouraged to ask themselves this: do you really want to look back on your career, and say that your biggest achievement was introducing Crack Whore(TM) lip gloss to the world?

Relevant Links:
Cocaine energy drink’s website
Cocaine & Crack info from the National Institute on Drug Abuse

So, thrill-seeking billionaire Richard Branson has decided to donate a huge chunk of money (over the next 10 years) to fight climate change.
Here’s the story, from Forbes: Branson’s $3 Billion Donation

…Branson announced that he’ll hand over all profits from his airline and train business to research and develop renewable-energy initiatives. What’s that mean? Branson estimates he’ll end up donating $3 billion over ten years.

Accoding to the BBC,

The funds will be invested in schemes to develop new renewable energy technologies, through an investment unit called Virgin Fuels.

Branson’s espoused reason for this? (From Forbes…)

I’ve got children; hopefully I’ll have grandchildren. Everything I’ve read about the world shows we need to reinvest in new sources of fuel. I’m in a position to do something.

Sounds like a nice bit of philanthropy. Now, there is a bit of a catch. Branson isn’t just giving this money to charity. He’s planning on investing it in companies seeking to develop cleaner fuels, renewable sources of energy, etc.

Branson is quoted byABC News:

Obviously what we hope is to generate profit from that so we can then carry on reinvesting it and building a powerful company, which can invest … in more fuels

OK, cynics: ready, set, GO!

“Ohhhhh,” quoth the cynic, “he’s not actually giving money away, he’s just investing it in hopes of making more money!”

But wait.

Will Branson get some press for this? Sure.
Will Branson’s ego get stroked? Of course.
Will he profit from his investment? Who knows. Maybe. It’s a gamble.

The key, I think, is this: Branson clearly has some cash at his disposal. (And by “some”, I mean “lots of.”) He can invest it in lots of things. He can invest it in Exxon (which would be a much safer investment). Or in the tobacco industry. Or in expanding his mansion. Or in solid-gold toilets for his private jet(s). Intstead, he’s decided to invest a huge chunk of change in something worthwhile.
So, is Branson going to get praised just as if he were handing money over directly to some charity? I sure hope so.

The language of “corporate citizenship” is pretty common these days. My friends Wayne Norman and Pierre-Yves Néron (at the University of Montreal) have been doing good work examining the ups and downs of applying the political vocabulary of citizenship to the artificial entities known as corporations.

In light of this, I found the following story pretty interesting:
Wal-Mart strides into election fray

Wal-Mart, the nation’s largest employer, is planning to launch a voter registration and education campaign this fall targeted at its 1.3 million employees in an effort to combat growing criticism from Democrats and labor unions.

By doing so, the world’s largest retailer is striding into the national political arena, which until this election cycle it has taken pains to avoid.

Fantastic, huh? A major corporation working hard to make sure its employers vote (in an era where voter turnout in many democracies is pretty pathetic). That’s good, right? Promoting voting, and other forms of legitimate political engagement, has to be a central virtue of citizenship. But wait, this is a big corporation, flexing its muscles in the political realm. That’s bad, right? Uh-oh! Lots of people get uncomfortable — understandably — when corporations (and their deep pockets) get too involved in politics. Well, it’s certainly food for thought.

As Wayne and Pierre-Yves argue, in a paper they presented at the Society for Business Ethics meeting in Atlanta last month…

What a normative theory of corporate citizenship needs…is a framework for deciding what sorts of political activities and relations with government regulators are appropriate or inappropriate, permissible or impermissible, obligatory or forbidden for corporations….

(p.s. Some people say Enron is the best thing that ever happened to Business Ethics, as an academic discipline, on the grounds that it did a lot to bring the importance of business ethics into the media spotlight, and made it harder for dinosaur colleagues in certain business schools to continue doubting the significance of ethical issues in business. I think Wal-Mart has done more for Business Ethics than Enron did, precisely because Wal-Mart presents so many ambiguities. Enron is the hard sell. But Wal-Mart is so much more thought-provoking.)

Over at the Rebel Sell blog, Andrew has a nice commentary on a NY Times story about the battle over standards for organic foods. Wal-Mart is (again, still) being accused of selling “organic” food (in this case, milk) that doesn’t meet the standards for real organic food.

Andrew’s response to one critic’s concern that feeding cows grain — even organic grain — isn’t natural? This:

Natural behaviour? Cows aren’t natural entities. Like dogs, they’re completely artificial. They’re basically living meat sculptures, shaped by humans, for human purposes, over thousands of years. Besides, who cares whether what they eat is part of their natural behaviour? You’re going to drink their milk. Once you’ve decided that you’re willing to swallow whatever comes out of a cow’s udder, you’ve pretty much abandoned any high ground on the “natural behaviour” front.

Seems to me the obvious pop-cultural touchstone for the un-naturalness of cow’s milk is comedian Tom Green’s famous stunt, drinking directly from a cow’s teat. (I’m sure Green wasn’t the first to do this for its shock value, but he did kinda perfect it.) Green’s shtick is funny precisely because it plays on our own visceral reaction to the un-natural act of drinking cow milk.

So, just what is the debate over? At heart, it’s a debate over “the principles” of organic agriculture. Which principles are those? Depends who you ask. Given that, as far as I know, there’s currently no evidence that organic anything is any safer for human consumption than non-organic equivalents, debates over standards pretty much have to come down to debates like the one Andrew justly mocks. Debates over which style of organic farming is “more natural” have more in common with disputes over interpretation of religious texts and debates over whether a particular transitional painting is best seen as part of an earlier, or instead a later, artistic era, than they do with debates over (say) standards for garment-industry labour. (I don’t see any reference in the NYT story to animal welfare. Is that one of the “organic” principles? That’s quite a stretch, I would think. I care about animal welfare, but isn’t that a separate issue?)

What it comes down to, I suspect, is that Wal-Mart has figured out which aspects of “traditional” organic agriculture consumers (or at least, enough consumers), actually care about, which is absence of pesticides and growth hormones. Wal-Mart will capitalize on the fact that their average shopper does not care — probably never will care — about whether the diet the milk-cow ate or the environment in which it was raised was “natural.” Even if there’s no concrete evidence that organic foods are healthier, that’s what most consumers want from it, not good karma.

Things are not getting any better at Hewlett Packard. (The story is about allegations that HP used unethical, perhaps illegal, methods to determine who on their board was leaking information to the press. See my earlier posting about this.)
From today’s NY Times:
Hewlett Review Is Said to Detail Deeper Spying

A couple bits worth noting from the NY Times story:

Hewlett-Packard has said that as a public company, it had a responsibility to stop unauthorized disclosures.

Note the use (appropriation?) of the language of ethics, here. HP claims to have had a responsibility — an ethical or legal duty — to stop the unauthorized disclosures. Now, that might well be true. In fact, it probably is true. But such an obligation clearly does not immediately imply a right to meet that obligation by any means necessary. (Interestingly, little of the coverage of this story has had much to say about the actions of George A. Keyworth II, the board member eventually found to have been the source of the leaks. Were his actions unethical? Illegal? A serious failure of governance? A breach of fiduciary duties? Now, two wrongs don’t make a right — even if Keyworth’s actions were inappropriate, that doesn’t make HP’s investigative measures justified — but I for one would like to know more about standards for board confidentiality.)

This is also pretty interesting:

The account of those briefed on Hewlett-Packard’s review of the matter sheds new light on the scope and timing of the investigative methods, establishing that invasive and possibly illegal techniques were used far earlier than previously known and that the company’s chief ethics officer was among those providing supervision. [empahsis added]

The Times names Kevin Hunsaker as HP’s senior counsel and “director of ethics.” I don’t know whether “director of ethics” is the same as “chief ethics officer”. I checked HP’s ethics page, and it doesn’t seem to say who’s in charge. The search tool on HP’s website also turns up nothing for the name “Hunsaker.” Is this guy a ghost? Or has the Times mis-spelled his name (doubtful). If anyone can clarify this for me, let me know.

For further reading:
Governance & Ethics at HP

Here’s the “other shoe dropping.”

Yesterday I posted about exploitative videos, including the Girls Gone Wild Series. I felt a little conflicted about that posting. On one hand, it was a bit like shooting fish in a barrel: you don’t need a philosophy professor to tell you that selling videos of drunking co-eds flashing the camera is not exactly the height of virtuous business. On the other hand, it’s not like they’re snuff videos or anything.

A little more digging around on the internet proved disturbing. I found two stories from reputable sources, which together suggest that the dude behind Girls Gone Wild — Joe Francis — is more than just a low-level creep.

Dispatches From Girls Gone Wild, by Ariel Levy for Slate magazine.
‘Baby, Give Me a Kiss’, by Claire Hoffman for the L.A. Times’ West magazine.

(See especially Hoffman’s piece, which gives a first-hand account of an assault, and a second-hand account of a rape.)

Two stories popped up this week involving people getting into legal trouble over the exploitative videos they sell.

One story, on CBC Radio’s The Current 2 days ago, was about so-called “bumfight” videos…videos that feature homeless people either being payed to fight each other, or engaging in other dangerous and/or degrading behaviour.
According to the on-line synopsis of the show,

There are few people as vulnerable as the homeless, because many are rendered that way due to addiction and mental illness. That’s why our first story is so shocking. It’s about a video series that shows homeless people being beaten, tied up, thrown down stairwells, and goaded into bloody fist-fights and stunts. It’s called Bumfights—available for rent in some video stores in Canada, and on the internet. In the first six months of operation, back in 2002, the producers generated more than half-a million dollars in sales.

The good news:

In June, 2003, several producers…pleaded guilty to staging an illegal fight for their videos. Last year McPherson and another producer were sentenced to six months in jail for failing to perform their community service.

Unfortunately: “Meanwhile, the company continues to produce new footage.”

(Question: why are bumfight videos so much more awful & exploitative than the Bumvertising that I blogged about back in December? Is it just the danger & violence? Or is it something else?)

The other story, which popped up on various news sources this week, is about the Girls Gone Wild series of videos.
Here’s one version of the story: ‘Girls Gone Wild’ Producer Pleads Guilty To Exploiting Minors

Joe Francis and the Santa Monica-based company he built on soft-core “Girls Gone Wild” videos has agreed to pay $2.1 million in fines after pleading guilty to violating laws designed to prevent the sexual exploitation of children.
Under the terms of a deal with the Justice Department, Francis agreed to personally pay a $500,000 fine to settle charges in Los Angeles that he failed to keep records of the ages and identities of the women who appeared in his films, the Los Angeles Times reported.
As a result, footage of minors engaging in sexually explicit conduct appeared in at least two DVDs he released, Francis said in a statement reported by The Times.

The interesting thing here is that Francis & co didn’t get in trouble for producing trashy, exploitative, demeaning videos. They got in trouble for poor bookkeeping. This serves as a pretty decent illustration of the distinction between ethics & the law. If you make videos of drunk women baring their breasts and then make a lot of money selling these videos, that is at least arguably unethical (see below), but it’s not illegal (in most places, anyway.) But if some of those “women” are underaged (i.e., under the legal age of consent), then (by definition) you’ve done something illegal. Similarly, you’ve broken the law if you simply fail to gather (and retain) evidence that the women are old enough: this is one of those cases where the legal onus is reversed…film-makers are required (in the U.S. — I don’t know about other juristictions) to have proof that they have not committed the crime of child exploitation.

Now, why do I say the videos are “arguably” unethical? Well, on one hand, when the women involved are “old enough,” then this looks like a voluntary commercial transaction: the women get t-shirts, free beer, fame, whatever. And in return the movie producers get images of bare breasts, girls kissing girls, etc. On the other hand, such videos are pretty demeaning to women. Showing women getting drunk & lifting their shirts is pretty straightforward objectification. Then again, you might ask: who’s responsible for the demeaning, here? Is it the women doing these things, or the guys selling the videos? But wait, then there’s the fact that most of the women involved are apparently drunk (see above re free beer), which renders their consent at least somewhat suspect. See what I mean? So, I’ll settle for “arguably” unethical. But even if you don’t think making & selling such videos is unethical: man, what a scuzzy way to make a living. Get a life, dudes.

(By the way, in case you were wondering, yes the Girls Gone Wild videos — some of them, anyway — are available via Amazon.com, but no I’m not going to link to them!)