Is a Promise a Guarantee?

Sadly, no.

Today's New York Times has an article by Leslie Wayne about Harvard Business School students who have devised an ethical oath. Approximately 20% of the class has signed on to the oath which asserts that a manager's goal is "to serve the common good."

Isn't that great? I don't want to rain on anybody's parade, and I certainly don't want to discourage people from behaving ethically, but I'll wait and see. It's easy to swear to be ethical in the abstract. The problem with an oath is not in the abstract but in the day-to-day here-and-now.

Otherwise, why would 50% of marriages (remember that "'til death do us part" section?) end in divorce? I have no doubt that most people making that vow mean it at the time that they say the words. But making a marriage last turns out to be a good bit harder on the day-to-day level than it appears to be before you take it on.

Similarly, behaving ethically in business seems a lot easier from the outside than it does day in and day out. The Harvard oath, according to the Times article, promises that oathtakers will "act responsibly, ethically and refrain from advancing their 'own narrow ambitions' at the expense of others." Unfortunately, it's sometimes hard to know which of competing interests should be given priority. And people are really good at convincing themselves that they are taking an action for the best and most moral of all possible reasons...

I don't want to rain on the Harvard parade (even if I am a Yalie!). But ethics is harder than an oath. And an oath is hard to live up to every day of your life.

Gimme Pens, Gimme Caps ... Get Rid of 'Em All

Remember how I said that doctors probably wouldn't be corrupted by a "gimme" pen? Well, it seems as though I was wrong.

A short item in yesterday's New York Times reported that a study conducted with third- and fourth-year medical students at the University of Pennsylvania (which bans most gifts) and the University of Miami (which allows them) indicates that even small gifts -- clipboards and notebooks -- had a measurable impact on how the students viewed competing drugs.

All the more reason to applaud the news out of Vermont today that the state legislature has passed a law requiring the release of the names of doctors and other health care providers receiving money from pharmaceutical and medical-device companies, and the amount that they receive.

A little transparency is a very good thing, and a lot of transparency is even better.

Don't Just Blame the Victim: Why Not Charge Him, Too?

"Food companies are placing the onus for safety on consumers" is the headline of an article by Michael Moss in today's New York Times. As the drive to keep food costs down -- particularly in processed prepared foods like frozen dinners -- intensifies, and as the supply chain for ingredients gets longer and longer (in some cases so long that the producers themselves apparently don't know who is supplying a particular ingredient), manufacturers have decided that the responsibility lies with the consumer to make sure that the final product is safe to eat.

How crazy is this?

Personally, I'd like to think that manufacturers would want to stand behind their products' safety as well as "taste" (I have to use quotation marks here, because, honestly, when have you eaten a frozen meal for its taste? Convenience, sure. Cost, maybe. But taste? ... Me, neither.).

This of course is what happens when deregulation goes crazy, and the funds for food inspection are slashed.

The industry solution is to give you complicated instructions for testing "at several points" that the product's internal temperature has gotten high enough to kill any possible pathogens. Seriously: how many of you own a food thermometer, and how many of you use it regularly? (Q1 for me: yes, I do; Q2: no, I don't)

One solution would be to tell consumers simply to stop buying prepackaged processed foods. That would undoubtedly be healthier, but (a) some recent outbreaks of salmonella and e. coli have been linked to fresh fruits and vegetables, (b) preparing all your food at home is often expensive, both in actual cost and time, and the poor in particular are less likely to have either, and (c) not everyone (especially the urban poor) has access to locally-grown organic food. And again, we'd be blaming the victim. And there's the small problem of what would happen to all those companies that manufacture those processed foods ... thereby employing thousands of people.

Some might suggest irradiation of all processed foods. Do we really need yet another "process", whose long-term effects are unknown?

Am I the only person who thinks that companies have a moral obligation to guarantee the safety of their products, and that the government has a moral obligation to see to it that companies do just that?

And best of all, doing the right thing would be a better business decision too. Yes, companies are under pressure to keep their costs down. But think, for a moment, of all the companies that use peanuts, and are now being hit by the peanut recall. Wouldn't a relatively few dollars of testing, and the rejection of bad peanuts, have been a lot less expensive than what they're facing now?

Information Wants to be Free. No, It Doesn't.

Frankly, information doesn't care whether it's free or not. It has no mind to make any assessment of its own value.

It's the cheapskates who don't want to pay for information who want it to be free.

I'll admit that my kneejerk reaction is to be one of those cheapskates. Who wants to pay for stuff if you don't have to? But we need to get past being kneejerks.

Today's New York Times has an article by Motoko Rich about the growth in digital book piracy. On one site, Scribd (which insists that it will immediately remove any text that it finds to have been posted illegally), a commentator termed the service "like the robinhood [sic] of ebooks." No, this is not Robin Hood. These pirates are not the good guys, stealing from filthy rich capitalists so that poor little you can read the book for free.

These days, the publishing business is having a hard time making ends meet. As always, most published authors don't make a living by writing. So if you really can't afford to pay for that book you want to read: Get thee to the library.

There's Ethical, and Then There's Ethical

I read an interview last week with Robert Iger, CEO of the Walt Disney Company, in which he quoted Warren Buffett on hiring criteria: "When you hire someone, you have to look for brains, energy and integrity, and if they don't have the third, integrity, you better watch out, because the first two will kill you."

I've been thinking about that comment all week, because it's so completely right, and yet not completely right.

If you hire someone who's bright and energetic and unethical, you can be sure that some morning you'll wake up with shoeprints on your back, as he or she has stepped over you to get to the next run of the corporate ladder. But that's not the end of it, or how can you explain -- to go back to what seems like prehistory now -- a company like Enron, headed by a pastor's son and dedicated Bible-study participant, Ken Lay?

Was Mr. Lay simply a hypocrite? I know that's the response many people had, but that's too simple. He's no longer able to answer for himself, but I'm willing to accept that his faith was genuine, and his attempts to discern deeper meaning in Scripture was also genuine. So what happened?

Too many companies, I believe, create cultures that encourage ethics within the company, but encourage "unethics" outside the company. Call it the "us against them" mentality. The usual explanation for this kind of behavior (should anyone raise one of those pesky should-we-really-do-this questions) is, "If we don't, they will."

Need I comment that this is not an acceptable ethic?

I don't have the answer about how to create a 360-degree ethical culture. I don't think required business-school classes in ethics, for example, will solve it (if you don't have a solid moral compass by the time you're 25, I doubt that four course credits will give you one). Sure, a little less focus on short-term stock gains (which means changing the way senior executives are compensated) would help. But for now, I'd rely on regulation more than the natural goodness of people....

When in Doubt, Regulate

More and more scientific research shows that we humans are stunningly bad at self-assessment. We think we're better drivers than we are; we think we're better multi-taskers than we are; we think we're harder workers than we are. And now research (as reported in Benedict Carey's column in yesterday's New York Times) indicates that we think we're more moral than we really are too.

For example, students were asked how many daffodils they would buy at an on-campus fundraiser for the American Cancer Society that was to be held later in the semester. More than eight in ten predicted that they themselves would buy a flower, but just over half thought that their peers would make such purchases. In fact, only about four in ten of the students involved in the research actually purchased daffodils -- meaning that their behavior was more like what they thought everyone else's would be like, than what they had predicted for themselves.

Carey quotes one of the researchers, a University of Chicago psychologist, who says, "The problem is ... not only that we overestimate how we would have behaved. It's also that we blame every crisis or scandal on failure of character -- you know, if we just fire all the immoral Wall Street bankers and replace them with moral ones, we'll solve the problem."

That's not to say that we shouldn't be indignant about the shenanigans on Wall Street (and elsewhere). We should be. But we can't stop there. The point is that situations have a way of overwhelming an individual moral compass. It's easy to say hypothetically "I would never do X." But it's also easy to find yourself doing precisely X when the situation sets you up to do that. Sometimes even with the best of intentions (remember that old proverb about how the road to Hell is paved with good intentions?).

One of the most interesting findings of the research is that this "holier-than-thou effect" is less pronounced in societies that value interdependence than in those like ours that value independence and individual achievement. It takes a village, eh?

The best way to ensure that people behave in a moral way is to make it easy for them to be moral. And the best way to ensure that is to regulate. Self-regulation is about as likely to succeed as New Year's resolutions (no, I haven't lost those ten pounds yet; have you?).

Everything Old is New Again? Or Is It Just, Still, Old?

Back in 1979, Chrysler flirted with bankruptcy, trying to avoid being the first major American automobile manufacturer to file for such protection since Studebaker in the '30s (which, after all, had worked out really well for Studebaker in the long run, hadn't it?). Thirty years later, here we are, back to the future.

And just as a foreign white knight rode to Chrysler's rescue in 1998 (raise your hand if you remember the fiasco that was Daimler Chrysler), here we are, back to the future, with another foreign white knight, Fiat (one more round of "Fix It Again Tony" jokes, and then that's it. Please.).

The problems that Daimler Benz and Chrysler faced in their initial merger were many, but what doomed the merger appears to have been simply a clash of cultures. (There's a fine business-school case analysis on the Darmouth-Tuck website.)

"Culture" is another of those concepts (sort of like "ethics"....) that "real" business people tend to discount as critical to long-term success. It's all about the numbers, isn't it? Or the brand strategy. Or the supply-chain synergies. Or the whatever.

But who puts those strategies into effect? The management and staff of the companies, of course. And the companies' approaches are almost bred into the employees. With two companies whose styles and brand images were so different to pretend that this represented a "merger of equals" was laughable. Despite a lot of public-relations efforts to play nice together, it turns out that, almost from Day 1, there were arguments about everything, from the weighty (should Mercedes-Benz risk its lofty image in the U.S. by contributing parts to Chrysler vehicles?) to the ridiculous (should all employees use American-style or European-style business cards?).

Will things be different this time around? I'm not a gambler; but if I were, I don't think I'd wage very high stakes on a Fiat-Chrysler empire. All the problems of different cultures are present here too. Chrysler was in a stronger financial position then than it is now. And while Daimler-Benz had a well-known and highly-respected brand name in the U.S., few Americans under 40 are familiar with the Fiat name, and few Americans over 40 have fond memories of the brand (yes, I know about you Alfa Romeo fans; I loved that little Spider Veloce too). I hope I'm wrong.