What's Good for a "Working Mother" May Not Be Good...

...for working women in general.

Not if the women in question find themselves stuck in a pink-collar ghetto.

That, at least, seems to be a take-away from this week's ruling that Novartis Pharmaceuticals -- a regular on Working Mother magazine's "100 Best Companies to work for" -- must pay $250 million in punitive damages for discriminating against female sales representatives.

The jury decision for the class-action case opens the door to additional compensatory damages, which some reports have estimated could run as high as $1 billion. The jury awarded $3.3 million in compensatory damages to the 12 women who testified, but there are nearly 5,600 others who fall into the covered class.

In a Reuters piece that appeared in yesterday's New York Times, the president of Working Mother Media was quoted as saying that the magazine's criteria for its award relied on programs such as flextime, telecommuting, and paid maternity leave.

On its website, here's what Working Mother says "we love" about Novartis:

Being there for the kids isn’t the only reason this East Hanover, NJ–based pharmaceutical company offers its employees flexible schedules. “I’ve used my arrangements to allow more time for friendships, community activities, fitness and personal interests,” says mom Laurie Letvak, an MD who serves as global program head for its Glivac and Tasigna division and now compresses her weeks after years as a part-time worker. Jobsharers, telecommuters and other flex fans can rely on the firm’s easily customizable child-care offerings, including discounts on fulltime care at national chains with budget-friendly backup (just $15 to $25 per day) and in-home sick care ($5 per hour). Impressively, anyone who saves $4,000 in a pretax child-care account is gifted another $1,000 by the company. Summer camp fairs and college coaching programs help make life a little easier for the parents of older kids.

Which is all well and good ... except that the lawsuit claimed Novartis systematically discriminated against women in pay and promotion, and was especially discriminatory against women who got pregnant.

As Ann Woolner notes caustically in her article for Bloomberg Businessweek, "You can't keep the numbers up when you're out on maternity leave, and forget about staying on a management track."

"Women who sold pharmaceuticals for Novartis said that some of the doctors to whom they would pitch products expected something on the side. They groped, they propositioned, and one fellow stuck his tongue in the ear of a startled sales rep," Woolner reports.

The support that the women reps got from the company was less than stellar: "When one of the women complained, her supervisor, also a woman, reminded her that the physicians she saw were valuable to Novartis."

I think we can take that to mean that sales reps were not valuable.

The jury's verdict is one of the largest ever in a gender discrimination case.

Abigail Field at Daily Finance, following Susan Beck at Am Law Litigation Daily, thinks that might be because the jury realized that Novartis, and its lawyers, "just didn't get it." They both note that, in Field's words, the "defense's closing argument was laced with sexist stereotypes and must have left jurors with the impression that the company really didn't respect women." (Field's article is here; Beck's, which requires premium subscription to access, is here.)

That Novartis "didn't get it" may be one reason why the company chose not to settle out of court, as is more typical. (Or it could just be that, in comparison to Novartis' core net income in 2009 of $10.3 billion, $250 million doesn't sound like much.)

Among the most damning "dont' get it" quotes from the closing argument of Richard Schandig, a partner with Vedder Price: "I've never seen anybody cry so much on the witness stand in my life ... She didn't have very much to cry about ... It's like she had been knifed. Honestly. What was wrong with this woman? She was so fragile."

Best of all, Schandig referred to one witness as "that little blond that came up here from Texas."

No, this wasn't last week's episode of Mad Men. It was, maybe, a reminder that we still have a long way to go.

In a Rescue, What's the First Thing You Do

... after the actual physical rescue?

If your answer is, "Cover your a*& and have the victims sign release forms," you too can be an oil company executive.

We have all been following the story of the Deepwater Horizon blowout and subsequent oil spill. The economic devastation to Gulf Coast communities, the environmental damage, the human toll, the apparent lack of oversight by the federal Minerals Management Service -- there's a lot here for an ethicist to absorb.

I'd like to concentrate on just one aspect of the story. Here's the scenario:

The Deepwater Horizon oil rig has just blown up and sunk. Survivors, traumatized by the deaths and disaster they have witnessed, want nothing more than to go home and be able to assure their loved ones that they are indeed OK. But before they can do that ... there are forms to sign.

The Damon Bankston, a cargo boat attached to the rig when the blowout occurred, picked up survivors from lifeboats.

What happened next? According to New York Times reporters Ian Urbina and Justin Gillis,

The men were kept aboard the rescue ship, in the middle of the ocean, for a full 12 hours. Worse than the wait, [the interviewed survivors] ... said, was being forbidden to call their families. The men were told that the Coast Guard wanted to conduct interviews before the workers spoke to family or anyone else.

Rumors spread that the BP executives who had visited the rig were up on the Bankston’s bridge using the ship’s radio or a satellite phone to call home. (Complete article is here.)

NPR correspondent Joseph Shapiro interviewed one young survivor, who told him that when the Coast Guard arrived, papers were handed out, and they were told, "You need to sign these. Nobody's getting off here until we get one from everybody ... And then at the bottom it says something about ... this can be used as evidence in court...."

Even when the survivors got back to land, their ordeal wasn't over. The group were taken first to a hotel to meet with representatives from Transocean (owner of the Deepwater Horizon rig) and the Coast Guard. Urine samples for a mandatory drug test were collected, and the representatives handed out forms which the exhausted survivors were told to initial, which said, "I was not injured as a result of the incident or the evacuation." (Click here for the complete NPR piece)

According to the Associated Press, an attorney for 10 of the Transocean workers said that, "These men are told they have to sign these statements or they can't go home. I think it's pretty callous, but I'm not surprised by it."

Survivors' families waited at least 12 and in many cases more than 24 hours before receiving word that their husbands, fathers, brothers, and sons were alive.

Is this what you'd call ethical?

Me, neither. These men have been traumatized by a disaster, and the company shows its concern for them by traumatizing them all over again.

When in Rome, Should You Do as the Romans Do?

Not according to Economist columnist "Schumpeter", who argues in this week's edition that "when in Rome, behave like a Swede."

The columnist makes the case that doing the right thing is smart business.

I'd really like to think that people do the right thing because it's the right thing to do.

But I know that there are lot of folks out there who think that, in the "jungle" of business, it's eat or be eaten, and if that means you have to slip a couple of bills into someone's hands or cut some other ethical corners, well, that's just part of being a tough business person.

In other words, it's a macho thing.

Sadly for the macho among us, hard analysis indicates that they're wrong.

"Schumpeter" points to research by Wharton School economist Philip Nichols and by World Bank researchers David Kaufmann and Shang-Jin Wei; their paper, "Does 'Grease Money' Speed Up the Wheels of Commerce?", is available online here.

I know what you're thinking: What do those eggheads know?

Well, among other things, they know that "companies that pay bribes actually end up spending more time negotiating with bureaucrats. The prospect of a payoff gives officials an incentive to haggle over regulations. The [World Bank] paper also found that borrowing is more expensive for corrupt companies, probably because of the regulatory flux."

Moreover, the "hidden costs of corruption are almost always much higher than companies imagine. Corruption inevitably begets ever more corruption: bribe-takers keep returning to the trough and bribe-givers open themselves up to blackmail. Corruption also exacts a high psychological cost on those who engage in it..."

Our macho business guy is snorting here, I know: "High psychological cost? Only if they're spineless wimps to begin with."

Or not.

Still, if those reasons don't convince you, how about this?

"Schumpeter" also points out that "the likelihood of being caught is dramatically higher than it was a few years ago."

Whistle-blowers have more ways of getting information out, and getting it in front of a lot of people. Prosecutions are up. Prison sentences are getting longer and fines are getting bigger.

So if you aren't impressed with the "do the right thing because it's the right thing" argument, ask yourself: How would you have liked to be the Siemens CEO, having to explain to your shareholders why you had to pay $1.6 billion in American and German fines to settle bribery allegations? (click here for a Guardian story from December 2008 on the settlements)