Archive for the ‘film’ Category

Top 5 Business Ethics Movies

There are lots of ways you can learn about ethical issues in business. You can do some reading. You can take a course. But hey, it’s summer, so let’s talk movies. Here’s a list of my 5 favourite business ethics documentaries. Granted, these aren’t exactly great date movies. Nor are they action-packed blockbusters. But trust me you could do a lot worse.

So grab a bag of popcorn. Here they are, in no particular order:

Let’s start with one you’ve likely heard of, namely The Corporation (2003). This one was popular out of all proportion to either educational or entertainment quality. It’s full of half-truths and bizarre omissions. And its central theme, namely that the corporation is in some sense a psychopath, simply cannot withstand even cursory critical examination. But it’s still useful to watch — if only to understand the source and shape of so much anti-capitalist sentiment. (The Corporation is freely available online here.)

Next on my list is another what we might call ‘anti-business’ documentary, namely Walmart: The High Cost of Low Price (2005). This is one of my favourite videos for classroom use, because it’s a good test of students’ critical thinking skills. Some of the criticisms levelled at Walmart in the movie are entirely on-target: labour code violations, racist HR practices, etc. Other criticisms point to things that are in some sense sad, perhaps — the loss of so many mom-and-pop stores, for example — but far from evil. Others are downright ludicrous, such as blaming Walmart for random murders in their parking lots. Watching this one is a great way to see what is right, and what is wrong, with so many criticisms of business today.

The most recent of my top 5 is already a couple of years old. And while Food, Inc. isn’t about business per se, it is about the production of food, something that is increasingly industrialized and dominated by big business. And as businesses go, none could be more important to us than the food business. The movie does a good job of pointing out problems, but is regrettably short on solutions. A not-unrelated criticism is that the documentary makes too little use of relevant experts. How could a film make concrete recommendations about the future of food without bothering to interview, say, a food economist or two? At any rate, it’s a thought-provoking hour and a half.

Next on my list is a movie you probably haven’t heard of, namely The Take (2004). This one isn’t really a criticism of any particular company, or of any particular industry. At heart, it’s a plea for a different economic model — though the details here are a bit vague. The Take tells the true story of a group of Argentinian factory workers who, when their cruel capitalist boss shut down operations for obscure reasons, seize the factory, start up the machines, and try to make a go of it. The workers’ motto — “Occupy, Resist, Produce” — is in spirit awfully close to “Workers of the world, unite!” It’s a good story. Unfortunately, the movie ends before the story does. As the film closes, the workers have seized the factory and started up the machines and are full of optimism that they can do better without a boss. Can they really do it? Can they beat their little workers’ paradise beat the odds? The film leaves us with lots of idealistic hopes, but few answers.

My next recommendation is admittedly the dullest of the bunch, but still worth considering. A Decent Factory is a story about audits. Not financial audits, but supply-chain audits carried out by Nokia at the factories of one of its Chinese subcontractors. There are two striking aspects of this quiet film. The first is how the auditors seem to struggle with just how much to push their Chinese subcontractors on various issues. The auditors’ job is not an easy one. They are there to evaluate, but also to insist on improvements, or sometimes just to suggest, encourage, and cajole. The path forward is far from clear. This is related to the second striking aspect of the film, which is that the conditions at the Chinese factory are, well, mediocre. They’re not the kind of awful sweatshop that would make for a gripping exposé. Remember what your grade-school English teacher told you about the adjective “nice”? It’s a weak word, one that tells the reader little. That’s the sense in which the makers of this film use the word “decent” in their title. The Chinese factory is a…decent…factory. Not great. But not awful. And just what to think about that is left to the viewer.

Last but certainly not least is Enron: The Smartest Guys in the Room (2005). This one is arguably the best of the bunch. Based on the book by journalists Bethany McLean and Peter Elkind, the movie is a fun, accessible, and best of all plausible telling of the story of what is still the biggest and most complex business-ethics scandal of the century so far. Perhaps the thing that most attracts me to this documentary is its refusal to resort to easy answers. There’s no attempt to say it was “all about greed” or that “capitalism is evil.” The truth about Enron, and about capitalism more generally, is much more complex, and much more interesting, than that.

Ethical Investing and Values-Based Investing

If you’re an investor, and if you want your money invested in companies that will not just bring you a return on investment, but will also some good in the world, that means you’re interested in what is variously called “responsible investing” or “ethical investing” or “values-based investing.”

I was recently interviewed for a documentary on the topic. Here it is: “Responsible Investing: An Evolving Story.” The 20-minute video was produced by the Ontario Teachers’ Pension Plan (OTPP). OTPP (colloquially known as “Teachers”) is one of the biggest institutional investors in Canada, managing a fund of just over a hundred billion dollars.

One of the main points I tried to make in the segments I’m in is that the key to thinking about values-based investing is to think of it as a mechanism for value-alignment. That is, it’s a way for investors to invest in companies whose values are like their own. It allows pacifists to avoid investing in arms manufacturers, and allows anyone who is stridently anti-tobacco to avoid investing in that industry. It’s not about all of us investing in products or industries that are “more ethical”, overall. Such global judgments are difficult to arrive at, and even harder to find consensus on.

That is, it’s best not to think of values-based investing as “ethical” investing, as if in contrast to all that other, unethical, investing. Indeed, referring to it as “ethical” investing probably makes the same mistake as references to “ethical oil” or “ethical food” does: it confuses the fact that there is ethical reasoning involved in such investing with a much grander claim that your investments are the only (or most) ethical ones.

The Corporation is Not a Psychopath

Readers may already be familiar with documentary that came out a few years ago, called The Corporation. The film has many flaws; I can’t show it to my students without pausing frequently to correct misleading assertions and half-truths. But the key problem with the film lies in its attempt to arrive at a single, simple diagnosis for the many problems we see in the corporate world. The central conceit of the film is that the corporation fits the diagnostic criteria for psychopathy — that corporations, quite generally, act in destructive ways that demonstrate an utter lack of empathy or remorse. The problem is, the claim is utter bunk, and is utterly unsupported by what the film shows to viewers. But it’s also an idea that has struck a chord with a lot of people, seemingly summing up their darkest fears about corporations.

Part of the problem is that the film is sloppy with language. The film is called The Corporation, and the makers of the film clearly intend to refer to ‘the corporation’ in the abstract, corporations as a group, the very idea of them. It’s not referring to any particular corporation — like, that one over there. But in building its case, it cites diverse behaviours by various particular companies, and uses those to check off, one by one, the diagnostic criteria that psychologists associate with psychopathy in humans.

Here’s the list of diagnostic criteria that the film uses:

1) callous unconcern for the feelings of others;
2) incapacity to maintain enduring relationships;
3) recklessness with others’ health & safety;
4) deceitfulness;
5) inability to feel guilt;
6) failure to follow social norms.

The problem is that in order to use this list as a diagnostic tool, you need to apply it to a single ‘patient.’ But the film doesn’t do that, not ever; instead, it cherry-picks examples of heinous behaviour from across dozens of corporations over dozens of decades. It finds an example of Callous Unconcern on the part of one company, Recklessness on the part of another, and Deceitfulness on the part of others still. And so on.

The result is a kind of sleight of hand, and not very subtle sleight of hand at that. You can do the same trick with any ‘patient,’ of course, when your ‘patient’ is an entire category. If you cherry-pick examples from across many many particular cases, you can easily arrive at a diagnosis of psychopathy not just for The Corporation, but also fo The Government, The University, The Church, The Union, The Charity, The Newspaper, or even — *shudder!* — The Highschool Volleyball Team.

Now it is crucial to note that by pointing out this flaw in the argument put forward by the film, I’m not defending any of the companies that it mentions. Many of those companies have done terrible things, including things that are outright criminal. The point is that the film fails utterly in its attempt to prove that the corporation as a whole is a “psychopath,” or anything like it. And the result is much more than a documentary that fails to make its point. The result is a distraction, as viewers duped by the film are told to write off the very notion of profit-seeking corporations, a prescription that ignores the enormous amount of human wellbeing that has resulted directly from the activities of corporations, and also diverts attention from a more focused critique of the very real flaws that exist in the way particular corporations are governed and regulated.

Chasing Madoff (movie review)

Chasing Madoff (movie)The documentary Chasing Madoff opens this week. I had a chance to attend a preview of the movie last night (courtesy of eOne Films).

The film is really the story of fraud investigator Harry Markopolos, the guy who, while working as an options trader at Rampart Investment Management, discovered Madoff’s scheme and worked valiantly to get the Securities and Exchange Commission to take notice.

It’s kind of a fun film, but not a great film. The film lacks a narrator, opting instead to tell the entire story through the first-hand accounts of a handful of people (primarily Markopolos and a couple of colleagues, along with a few of Madoff’s victims) and snippets from newscasts. The focus on first-person accounts gives the film a personal feel, but it also inevitably means a perspective that is slanted, though perhaps not fatally so.

There are a few laughs in the film. Markopolos is a bit of a strange cat. He’s a likeable guy, and apparently a man of integrity, but also a bit paranoid-sounding. On-screen, he tells us that he feared Madoff so much that he was ready to pre-emptively shoot the guy, if Madoff had discovered his investigation. He also describes what his strategy would be in the event of an armed standoff with the SEC, should they ever come to his home to get his files — files that included damning evidence of SEC complacency. Just for emphasis, one scene shows him leaning against his desk, brandishing a pump-action shotgun. These humourous parts are, I think, intentional, or at least surely the director (Jeff Prosserman) must have known they would spark laughter. And humour is fine, but it tends to undercut the filmmakers’ stated intention of generating outrage in their audience.

What’s most striking, perhaps, about Chasing Madoff is what it doesn’t tell us about the Madoff scandal. For example, it points fingers at the SEC, but tells us nothing about the agency’s funding levels, and whether it had the capacity to keep up with complaints like Markopolos’s as they flowed in. There are also allegations that “someone higher up” at the Wall Street Journal tried to stifle the story before it broke, but little evidence to back that up. And there are intriguing hints about the large number of individuals and organizations that must have been complicit in Madoff’s crimes, and hints at why they had no economic incentive not to keep putting faith in his results. There’s even a claim that Madoff “paid top dollar” to those that would bring him “new victims.” But the relevant parties are not named and the film makes little effort to explain the connections.

Bottom line: I’m a university professor — would I show this movie in my Business Ethics classroom? Probably not. It’s a fine portrayal of man of integrity fighting the good fight, but it teaches relatively little about how the financial crime of the century happened, or what if anything would prevent it from happening again.

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