"The greatness and the genuine trait of your thought and writings lie on the fact that you positively and interestingly make use of philosophical thoughts and thoughtfulness in order to deeply and concretely cogitate about America's social issues. . . . This does not mean that your thought is reducible to your era: your thought, being inspired by issues characterizing your era . . . , overcomes your era and will still likely be up to date even after your era, for future generations." Bruno Valentin

Wednesday, November 9, 2016

Societal Norms Understating Unethical Corporate Cultures: The Case of Wells Fargo

The case of Wells Fargo suggests that even when a massive scandal is revealed to the general public, the moral depravity of a company’s culture is skirted rather than fully perceived. Wells Fargo was fined a total of $185 million by regulatory agencies including the Consumer Financial Protection Bureau, which had accused the bank of creating as many as 1.5 million deposit accounts and 565,000 credit-card accounts that for which consumers never asked. The bank fired 5,300 employees over the course of about five years after it was revealed those employees had opened the accounts and credit cards.[1] Wells Fargo's CEO at the time, John Stumpf, "opted" for a cushy early retirement after an abysmal performance before a U.S. Senate committee; he walked away from the bank with around $130 million[2], and none of the other members of senior management were fired, or "retired," obliterating any hope societally that any of the senior managers would be held accountable. This result is particularly troubling, given the true extent to which that management had turned the bank into an ethically compromised organization.

"There is a serious problem with senior management at Wells Fargo," U.S. Senator Elizabeth Warren told CNBC in September, 2016.[3] "You can't have a scandal of this size and not have some senior management who are personally responsible," she said.[5] With so many sham accounts and fake credit-card applications, the problem must have gone beyond particular executives giving orders. As a former bank employee told me, “When we went to work there, we knew we were selling our souls to the devil.” To be sure, being willing to be hired anyway is a choice worthy of blame. We can be struck nonetheless at the unexpected banality of bank. It is truly remarkable both that a well-established institution could have such a sordid culture out of public view, and that senior managers could be fine with such “shared understandings” within the bank.

Besides the over-charged customers, aggrieved Wells Fargo workers--"people who say they were fired or demoted for staying honest and falling short of sales goals they say were unrealistic"--bore the brunt of the unethical senior and middle management[5]. For example, Yesenia Guitron, "a former banker, sued Wells Fargo in 2010--three years earlier than the bank has admitted it knew about the sham accounts . . . Intense sales pressure and unrealistic quotas drove employees to falsify documents and game the system to meet their sales goals, she wrote in her legal filing.” She “said she did everything the company had taught employees to do to report such misconduct internally. She told her manager about her concerns. She called Wells Fargo’s ethics hotline. When those steps yielded no results, she went up the chain, contacting a human resources representative and the bank’s regional manager. Wells Fargo’s response? After months of what Ms. Guitron described as retaliatory harassment, she was called into a meeting and told she was being fired for insubordination.”[6] Clearly, she had not gotten the memo on the requirement of selling her soul to the devil.

A memo to the rest of us could inform us that our designated watchdogs in the media do not go far enough in uncovering for us just how bad things are in companies run by unethical people. The extent of their moral depravity, and thus of the organizational culture, is not reaching us. As a result, we cannot push our elected representatives enough—the corporate lobbying notwithstanding—to enact legislation that is sufficient to meet such challenging cases. We suppose, for instance, that the replacement of a CEO can be sufficient to usher in restorative measures at the company level in spite of the extent of depravity.

1. Jon Marino, “Bove: Wells Fargo Will Make Retail Banks ‘Rethink’ Compensation,” CNBC.com, September 14, 2016.
2.Matt Egan, “Wells Fargo CEO Walks with $130 Million,” CNN Money, October 13, 2016.
3.John Marino, “Elizabeth Warren.”
4.Marino, “Elizabeth Warren.”
5. Stacy Cowley, “Wells Fargo Workers Claim Retaliation for Playing by the Rules,” The New York Times, September 26, 2016.
6. Cowley, “Wells Fargo Workers.”

Saturday, October 29, 2016

An Anti-Obesity, Anti-Poverty Philanthropist Joins PepsiCo.’s Board: A Case of Reform from Within

In October 2016, Darren Walker, president of the Ford Foundation, became the newest member of PepsiCo’s board of directors. Whereas Walker worked at the time for a more just and equitable society, Pepsi was making the bulk of its money by selling sugary drinks and fatty snacks and there being a well-established link between obesity and economic inequality. Would he be working at cross-purposes? “There’s a risk that he will be viewed as inconsistent,” said Michael Edwards, a former Ford Foundation executive at the time.[1] The company itself could also be viewed as being inconsistent—lobbying against anti-obesity public-health legislation while putting Walker on the board of directors.

To be sure, the Ford Foundation had not funded organizations working to combat obesity or diabetes, so there does not seem to be a direct conflict of interest for Walker.[2] Yet he did acknowledge, “I know that my own credibility and the credibility of the Ford Foundation is tied to this decision. Those of us in philanthropy have to be discerning about the corporate boards we join, and be discriminating to ensure that our service on a board is aligned with our values.”[3]

So rather than there being a conflict of interest, the issue for Walker was whether he could act as a reformer from within. Even though he planned bring the perspective of a social-justice organization and his own perspective “as someone who is deeply concerned about the welfare of people in poor and vulnerable communities,” he would still bear responsibility should PepsiCo’s board go in another direction.[4] He would not, in other words, be chairman of the board. That the company had just pledged to further reduce the amount of sugar, fat, and salt in its products by 2025, however, suggests an appetite for accommodation with Walker’s perspective. Additionally, Walker would not be responsible for the company’s past unethical lobbying against anti-obesity legislation, use of unethical suppliers of palm oil, and deceptive marketing, and the company had since taken steps to remedy these ethical problems.[5]

As in politics, the matter for Walker and the other board-members concerning would be whether together they could wield compromises taking into account both Walker’s vantage-point and the legal and ethical fiduciary duty to act as faithful stewards of the stockholders’ capital. Reform from “the inside,” moreover, can be more productive than merely staying in the philanthropic sphere. In terms of American politics, the analogue would be moving from the Green Party, for instance, to the Democratic Party so as to work toward reform that could actually manifest in legislation. Admittedly, idealism is tested in such a strategy, but consequentialism tells us that even 50% of 10 is more than 0% of 10.

1. David Gelles, “An Activist for the Poor Joins Pepsi’s Board. Is That Ethical?,” The New York Times, October 28, 2016.
2. Ibid.
3. Ibid.
4. Ibid.
5. Ibid.

Tuesday, September 27, 2016

Facebook’s Zuckerberg Donates $3 billion to Medical Science: Some Major Implications

Facebook’s CEO, Mark Zuckerberg, and his wife, Priscilla Chan, announced in September, 2016, that they would invest more than $3 billion during the next decade to build tools that can facilitate medical research on diseases. The first outlay of funds ($600 million) would create a research lab of engineers and scientists from the area’s major research universities.[1] “This focus on building on tools suggests a road map for how we might go about curing, preventing and managing all diseases this century,” Zuckerberg said at the announcement.[2] Moreover, the couple had previously announced a year before that they would give away 99% of their wealth over their lifetimes through the Chan-Zuckerberg Initiative in the areas of education and healthcare. I would like to point out a few implications that may not be readily apparent.

Firstly, such funds going to preventing and curing disease could bring the day nearer when—along with advances in anti-aging and stem-cell research—death is no longer inevitable for a human being. Even before the Zuckerberg-Chan announcements, some scientists were openly predicting that that day might come as early as the 2050s. To be sure, being able to grow replacement organs, apply an anti-aging treatment to the body’s cells, and prevent major diseases (I suspect the common cold will still be around, just to keep us humble) does not guarantee that death will be put off; running into a train or bus, or jumping off a high building could still mean death. Nevertheless, the notion that death can be put off indefinitely dwarfs the combined impact from all the twentieth-century’s technological progress put together.

Considering the costs involved, access to rendering death no longer inevitable would doubtlessly raise ethical issues in terms of the distribution. Moreover, ethical questions would suddenly arise concerning the species’ increasing population and reproduction-rights. Secondary issues such as climate change could become even more pressing. It could be, for example, that a drastically increasing human population outstrips the planet’s food-capacity as well as the capacity of the atmosphere to absorb the species’ waste, including greenhouse gases. It would be highly ironic were the feat in removing the threat of death a major contributor to the extinction of the species. In short, the story could go as follows: we maximize our species’ size—which means success genetically—only for the increased numbers to cause extinction because the climate is no longer hospitable to human habitation or the lack of food causes wars ending in nuclear war. The first alternative would be particularly likely.

Secondly, that the couple could give up 99% of their wealth over their lifetimes may imply that they will have earned too much money, if being able to use it is at all relevant. Put another way, being able to give away almost all of their total earnings may suggest that they (namely Zuckerberg) earned too much. Does it even make sense for someone to get money that is beyond the capacity to be spent even through inheritance?

One implication is the question of whether Zuckerberg’s employees at Facebook should get a significant amount of what Zuckerberg earns, whether in salary or stock. Why such a huge difference in compensation? To be sure, ownership does have its privileges, but is there no limit? The fact that Zuckerberg, Bill Gates, and Warren Buffet could give vast sums of money to charity raises the question of whether founders and CEOs shouldn’t face some limit in terms of wealth, with a progressive tax system kicking in for multi-billionaires. Were elected representatives to decide how such vast sums should be spent, the legitimacy of the power behind such a decision would be greater.

1. Deepa Seetharaman, “Zuckerberg Fund to Invest #3 Billion,” The Wall Street Journal, September 22, 2016.
2. Ibid.

Wednesday, August 26, 2015

Mass Shootings in the U.S.: Why Are Americans So Angry?

Even though the United States account for less than 5% of the world’s population, 31% of the total number of mass killings worldwide between 1966 and 2012 occurred there.[1] I contend that a rise in passive aggression and the related intolerance accounts for much of the difference. In other words, it could be that Americans generally are getting nastier and more angry at each other.

Although not a mass-shooting, Vester Flanagan shot two former co-workers in August 2015. While it is easy to relegate the story by simply concluding that the guy was nuts, a closer examination reveals the situation to be more complicated. The nuances may help us understand what lies behind the mass-killing violence that goes beyond the killers themselves and is disproportionately an American phenomenon. In analyzing the Flanagan case, I want to stress that even if his coworkers had been at fault, the double-murder was completely unjustified. My analysis is oriented to uncovering a hidden trend in American society rather than answering whether the shooting is justified.

In a lawsuit against another network in 2000, Flanagan had claimed that a producer had called him a "monkey" and that he had been "made aware that other black employees ... had been called monkeys by officials affiliated with defendant." He also claimed that a Caucasian "official" had told him that "it busted her butt that blacks did not take advantage of the free money," referring to scholarship funds. Additionally, he insisted that a supervisor at the station had said that "blacks are lazy,” and that that another employee had told a black tape-operator to "stop talking ebonics." WTWC-TV acknowledged that an employee "may have made similar comments to another employee," but denied that such comments are "indicative of unlawful employment practices." The case ended in a non-disclosed settlement.[2] The admission of race-oriented comments to another employee lends some credibility to Flanagan’s assertions.

Even so, Flanagan may have made his own contribution to the workplace tension. The news station denied that his termination was the result of discrimination. It instead cited "poor performance," budgetary reasons and "misbehavior with regards to co-workers."[3] The latter in particular resonates with what he wrote regarding the cameraman (Adam) and reporter (Alison) from his next station. After announcing that he filmed the shooting, he wrote, “Adam went to hr on me after working with me one time!!!”[4] Either Adam had overreacted or Flanagan’s treatment of co-workers was incredibly bad. Flanagan also wrote, “Alison made racist comments” to him, and that he had filed an EEOC report.[5] It could be a case of “white privilege,” or simply that Alison was racist (or that she took sides with Adam).

In any case, the shooting stemmed from anger in the workplace—people not getting along and not having the social skills to work things out rather than make things worse. Adam’s quick trip to the station’s human resources department may indicate a lack of tolerance, as well as a tendency to escalate matters rather than patiently work them out. If Alison made demeaning racial statements to Flanagan, then perhaps her attitude may have been condescending and thus inherently conflictual. Of course, both Adam and Alison may have simply been reacting to extraordinarily bad treatment from Flanagan—his report to the EEOC being an effort to go on the offensive rather than admit that he had treated his coworkers very badly.

I suspect that at least part of the problem is societal—Americans may be been becoming more passive aggressive, and this anger in turn might be kicking the outright aggression up a notch in some people. The lack of tolerance for disagreements shows up in the ideological fragmentation of the American news networks, for example, with Fox News and MSNBC employees on the air brazenly displaying utter disdain for progressives and conservatives, respectively. Dismissiveness toward others, or in other words being “too cool to talk,” stemming from an abject lack of respect for others, may have been increasing at least in the Millennial Generation. As the sordid attitude becomes more socially acceptable as a social more in America, then increasing anger and ensuing aggression can be expected. “Road rage” is a case in point: an extreme hostility toward other people ruffling feathers. Why are so many Americans angry? This may be part of the reason why the U.S. has a disproportionate number of mass killings, and I suspect that the same holds for workplace (and former workplace) violence.

[1] Stan Ziv, “Study: Mass Shootings ‘Exceptionally American Problem’,” Newsweek, August 23, 2015.
[2] Dana Liebelson and Jessica Schulberg, “Shooting Suspect Sued Another Newsroom for Racism, Claimed He Was Called a Monkey,” The Huffington Post, August 26, 2015.
[3] Ibid.
[4] Ibid.
[5] Ibid.

Saturday, August 22, 2015

Humans As the Intense Predator: Unbalancing the Food-Chain Unsustainably

By 2015, humans—the homo sapiens species in particular—had become “the dominant predator across many systems”; that is to say, the species had become an unsustainable "super predator."[1] We have had a huge impact on food webs and ecosystems around the globe.[2] Moreover, we have been using more of the planet's resources than we should. By August 2015, for example, humans had already consumed the year's worth of the world's resources.[3] In terms of fossil fuels, the consumption has had an impact on the warming of the Earth’s atmosphere and oceans. Behind human consumption are human beings, so the astonishing increase in human population is a major factor. As a virus-like species incredibly successful genetically over the previous five-hundred years, the self-maximizing feature both in terms of population ecology and profit-maximization may be the seed of the species destruction, and thus long-term genetic failure.

According to one study, humans are "particularly intense" when it comes to hunting, and have used powerful killing technology (trawl nets, guns and mechanized slaughterhouses, for example) to dominate other predators. [4] 

Large-scale fishing does not distinguish between fertile adults, weak fish, and the young. (James Watt: Getty Images)

With the efficiency (i.e., profitability) of large-scale fishing businesses, we remove fish at 14 times the rate of marine predators.[5] The research confirms what many scientists had warned for years: If we don't stop overfishing, we may soon run out of animals to catch. The study reports that many fish populations had already been hunted to the brink of collapse, shark populations decimated, and less than 8 percent of southern bluefin tuna left. [6] On land, humans had been killing top carnivores, such as bears, wolves and lions, at nine times their own self-predation rate.[7] By 2015, the food chain as a whole had become terribly unbalanced that thus unsustainable as a whole.

Applying business-efficiency principles to hunting, we can capture adult prey at minimal cost, and so gain maximum, short-term reward. The cost being minimized is both in terms of business and the species. Of the latter, Chris Darimont of the study points out that "advanced killing technology mostly excuses humans from the formerly dangerous act of predation." [8] Because hunters “’capture’ mammals with bullets, and fishes with hooks and nets. . . [Humans] assume minimal risk compared with non-human predators, especially terrestrial carnivores, which are often injured while living what amounts to a dangerous lifestyle."[9] To be sure, working on the deck of a commercial fishing boat in the north Pacific is one of the most hazardous jobs around, but the fishing businesses can externalize at least some of the cost (e.g., insurance).

Even so, by not applying principles from population ecology, the businesses engaged in hunting, fishing, and farming animals have been undermining efficiency, and thus profitability. The study claims that besides the sheer number of animals that humans kill for food being problematic—56 billion farmed animals were at the time being slaughtered annually, “(h)umans focus on adult prey, unlike other predators. A full-grown lion, for example, often opts for the smaller, weaker juvenile zebra rather than an adult. This distinction makes it harder for animal populations to recover as breeding members are removed.”[10] Presumably recovering populations are in line with sustainable profitability.

Tom Reimchen, a co-author on the study, “uses a financial analogy to explain the damaging consequences of hitting adult populations hardest. He calls the adults the system's ‘reproductive capital’—the equivalent of the capital held in a bank account or a pension fund. And he says we are eating into this capital when we should really be living off the interest—the juveniles, which many species will produce in colossal numbers, expecting a good fraction to be doomed from the moment they are born via predation, starvation, disease, accidents and more.”[11] “We are dialing back the reproductive capacity of populations," Darimont said. [12]

The doubtlessly unintentional self-defeating strategies of the businesses mirrors that of the species itself, in that the failure to be prudent in terms of population growth is also self-defeating because the ecosystems, including the Earth’s atmosphere and oceans, get breached beyond repair in terms of being able to sustain our species when it is essentially a maximizing variable rather than tending toward an equilibrium. In short, the wise human species—homo sapiens—is not so wise, after all.

1 Chris Darimont et al, “The Unique Ecology of Human Predators,” Science, Vol. 349, no. 6250, pp. 858-860.
2 Ibid.
3 Jonathan Amos, “Humans Are ‘Unique Super-Predator’,” BBC News, August 20, 2005.
Nick Visser, “Thanks Humanity. Now We’re Unsustainable ‘Super Preditors,” The Huffington Post, August 21, 2015.
5 Amos, “Unique Super-Preditor.”
6 Visser, “Thanks Humanity.”
7 Amos, “Unique Super-Preditor.”
8 Ibid.
9 Ibid.
10 Visser, “Thanks Humanity.”
11 Amos, “Unique Super-Preditor.”
12 Visser, “Thanks Humanity.”

Tuesday, August 4, 2015

The Natural Wealth Model of the Modern Corporation: A Basis for Sustainable Organization

Going to the Humanities to construct a sustainable organization based on ecological theory, this essay presents a theory of the firm that is at odds with the profit-maximization premise. I draw on the notion of the natural wealth of the Golden Age as depicted by such ancient Western poets as Ovid and Hesiod—who assumed such wealth to be devoid of greed—as a basis for sustainable organization from ecological theory to produce an alternative theory of the firm.

Sunday, July 26, 2015

Apple’s CEO Manufactures a Human Right

People with disabilities represented 19% of the U.S. population in 2015—exactly 25 years after the Americans with Disabilities Act (ADA) became a federal law.[1] With computer technology being by then integral to daily life, the matter of accessibility came to the fore under the normative principle of equal, or universal, access. With major tech companies getting behind this banner, one question is whether they did so simply to sell more computers and software—better access translating into more customers. I contend that the stronger the normative claim being made, the greater the exploitation of the underlying conflict of interest.

In 2015, the American computer sector still suffered from “a lack of industry-wide expertise in accessibility development.”[2] So companies including Facebook, Microsoft, and Yahoo put together the Teaching Accessibility program to teach engineers, designers, and researchers how to include accessibility development in their skill-sets. "Increasing awareness and accessibility learning through core education, academic leadership, learning tools, industry initiatives, and partnerships with disability organizations will further enable graduates in relevant disciplines to enter the workforce and begin creating future technologies that are truly inclusive," Eva LaManna, policy manager for AAPD, said in a statement.[3] The premise, according to Larry Goldberg at Yahoo, is that making tech products accessible “is simply the right thing to do.”[4] Of course, doing so would not hurt sales either. This point undercuts the credibility of Goldberg’s normative claim, for it would be naïve to suppose that he and his colleagues would be motivated by “the right thing to do” were it not in the company’s financial interest. In other words, I contend that the normative claim is sheer marketing designed to garner the company reputational capital and at the same time advertise to the disabled.

Although Apple was conspicuously absent, the company had been training its engineers in the development of accessibility features. Indeed, the CEO, Tim Cook, wrote on July 24, 2015, went further than Goldberg in asserting the value of accessibility for everyone. “Accessibility rights are human rights. Celebrating 25yrs of the ADA, we’re humbled to improve lives with our products.”[5] To claim that a right is a human right is of course easy; the assertion may simply be a way of saying that something is very important. That is to say, if you value something highly, one way of expressing this is by asserting that it is a right—in fact, a human right. This implies that the thing that you value should be valued by everyone. He is essentially universalizing his maxim, making it a universal normative law. Obviously, we can wind up with loads of human rights going well beyond sustainability this way. Cook was indeed making a claim that human rights extend beyond needs, and thus are potentially limitless, unless access to computer technology was at the time essential to survival in the interdependent society.

If accessibility was at the time vital to survival, then government may have had an obligation to see to it that every person has access to a computer regardless of wherewithal to pay. This point presupposes that survival itself is a human right. Interestingly, Cook’s assertion that the right to accessibility is a human right can be interpreted as a claim obligating Apple to see to it that every person has access to a computer regardless of ability to pay. Faced with the implication that the company must hand out free computers (and accessibility software) to the poor, Cook might have sought to walk back his statement to something like, “At Apple, we believe it is important that computers be accessible to people with disabilities.” In retrospect, the man’s human-right claim may seem over the top. His conflict of interest may explain why he went so far without taking into consideration the implications.

For one thing, he may have been seeking to tout Apple’s record on accessibility. This is, after all, why Apple had not joined the training initiative. At the time, the iOS operating system included features like voice over, “speak screen,” dictation, zoom, and support for Braille displays.[6] To the extent that Apple had a sustainable competitive edge in accessibility, Cook had a huge financial incentive to make as bold a claim as possible. In business terms, a strategic competitive advantage should be highlighted in marketing so the potentially high profitability is more likely to be realized.

Interestingly, the marketing dimension itself undercuts the message in more than one way. First, the self-interest belies the claim of humility, and possibly even the claim of wanting foremost to improve lives. Given the manager’s fiduciary duty to the stockholders, his primary motive is to increase profits. Second, readers of Cook’s claim that accessibility is a human right can justifiably doubt the validity of the claim itself because Cook had a vested commercial interest in making the claim. That is, greater accessibility means more people are using computers, and thus are potential new customers of Apple products. Cook had the motive, therefore, to make the claim even if doesn’t believe it to be true, and to beg off any inconvenient implications such as the obligation to give away computers to people unable to afford them. In terms of Kant’s ethics, that Cook’s maxim cannot be universalized without internal contradiction (i.e., everyone should have a computer, but only if they can afford it) renders the claim unethical. In other words, it would unethical for Cook to have made the claim then refuse to give away computers.

In short, public statements by CEOs should not be taken at face value because more is probably behind the assertions than meets the eye. I suspect that the general public is naïve concerning such statements; we are too willing to assume that persons of high stature societally—and this includes CEOs of large companies—are good natured, for we don’t have access to the discussions that go on inside corporations. We are not familiar with how business managers think, and what motivates them. We suppose them to be like us, and we do not tend to carefully craft our utterances to manipulate other people in a self-aggrandizing way. So we take a statement such as Cook’s at face value. He claimed that computer-accessibility rights are human rights, and thus every person has a just claim regardless of ability to pay, and yet he clearly did not mean to suggest that, for Apple would then be obligated, and that would not be in line with the bottom line.  

[1] “IOD Report Finds Significant Health Disparities for People with Disabilities,” Institute on Disability/UCED, August 25, 2011.
[2] Lorenzo Litato, “Silicon Valley Vows to Improve Tech for People with Disabilities,” The Huffington Post, July 24, 2015.
[3] Ibid.
[4] Larry Goldberg, “Teaching Accessibility: A Call to Action from the Tech Industry,” Yahoo (accessed July 25, 2015).
[5] Alexander Howard, “Apple CEO Tim Cook: ‘Accessibility Rights Are Human Rights, The Huffington Post, July 24, 2015.
[6] Ibid.