"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

Sunday, November 25, 2018

Saving the Fisheries: Greenpeace Praised Safeway for its Ethical and Stately Leadership

In April 2011, Greenpeace gave fifteen supermarket chains a passing grade; five others failed. Surprisingly, Safeway came out on top, above even Whole Foods. Safeway pledged to stop selling Chilean sea bass (Patagonian toothfish) because current fishing levels are unsustainable. Furthermore, the grocer called on governing bodies to declare the area in the southern Antarctic where the bass is fished a marine reserve. According to Casson Trenor of Greenpeace, such an act of “corporate marine activism” had “never been done before.” Safeway also discontinued the sale of orange mughy, which is unsustainably being fished in the deep sea off New Zealand.  In fact, the company stopped adding red-list species to its inventory.

Beyond any added sales from the enhancement of Safeway’s reputational capital, the company’s moves, going even as far as activism, are in line with facilitating the future supply of the seafood products.  In other words, the moves represent a sort of long-term investment, with the cost being the additional money that could be made in the short term from selling the fish. That other grocers, such as Giant Eagle and Publix, failed in the Greenpeace grading suggests that other companies are profiting in the short term from Safeway’s self-imposed restraint for a long-term benefit available to every grocer. 

In other words, it goes against the law of externalities for one company to voluntary exclude an otherwise salable product from the shelves while competitors benefit from not only that exclusion, but also the long-term benefit of full fisheries available to any grocer. Ordinarily, this dynamic is why a cartel or government regulation is necessary—so all companies recognize the constraint in the short term for the good of the whole industry in the long term. As compelling as that long-term benefit may be, some people will refuse to shove the trough away while there is anything left in it—such is the instinct of instant gratification over deferred enjoyment in human nature.  Hence, it is amazing that any one business would observe a self-imposed constraint at the expense of expediency that is not being observed by others in the industry.

Safeway may represent a case of ethical leadership that is in line with statesmanship. In addition to being ethical (i.e., following an ethical principle such as sustainability), standing alone in the activism (i.e., the leadership) in this case forsakes immediate self-interest for the public good (i.e., statesmanship).  The three elements—ethics, leadership, and statesmanship—can thus be distinguished and related.

An interesting question is whether corporate managers are being ethical in terms of their fiduciary duty if ethical leadership in line with statesmanship is not in stockholders’ financial interest even in the long term. In the present case, it could be argued that the foregone profit is not worth the added profit in the long term from sustainable fisheries.  Additionally, it could be argued that Safeway could have continued to sell the unsustainable fish as Target and Wegmans sacrificed for the eventual benefit that Safeway too could enjoy. The problem of fiduciary duty could be obviated in such scenarios by securing stockholder approval at an annual meeting. 

At the level of property rights, profit-maximization is only a default that a company’s stockholders, as the owners, can modify or even replace.  Therefore, if a majority of shares vote to use the company to save the fisheries even at the overall financial detriment of the company, such a use of property/wealth is proper and legitimate for owners, with the caveat of minority stockholder rights being respected. Such rights can be satisfied by giving minority stockholders the right to sell at a worthwhile and fair price. Such selling would result in more solid ownership support for the new mission. Moreover, to use one’s property not only to make money, but also for a cause that one is passionate about can make life itself more enjoyable and thus worth living.   

Source:

Kim O’Donnel, “Safeway Scales the ‘Seafood Scoreboard’ by Greenpeace,” USA Today, April 18, 2011, p. 5D.

Saturday, November 24, 2018

Black Friday: An American Holiday

For a long time, I didn't understand why the Friday after Thanksgiving in the U.S. would be called Black Friday. Why associate darkness with such a nice holiday whose humble purpose is to feel gratitude, even and especially if a person has little externally for which to feel grateful. Black Friday is so named because the shopping day is so bit it can bring retail businesses out of the red and into the black, as if profitability were dark rather than something worth rejoicing--in business, I might add--rather than for a whole society. For American society to so easily have come to call the day following Thanksgiving black just because that is how managements perceive it demonstrates just how commercialized, or business oriented, American society has become. What this means for that society, and even perhaps the majority of the people themselves, is very troublesome, even disturbing.
It seems that every Black Friday reports come in concerning customers fighting for products of artifically (and doubtlessly intended) limited supply--meant to lure a lot of "guests" to the stores whether they get the real good deals or not. After many years avoiding going to retail stores on that day of the year, I finally went to a Walmart and Best Buy to investigate my thesis and even maybe buy something--a laptop in particular.
At the Walmart store, I arrived about an hour before the beginning of the store opening only to see customers with huge television screens--in some cases, even five in one cart! As for laptops, people could not get them until the opening bell, so a long line was already forming. Comparing the in-store sales I had looked at online (not just online sales) with what the store actually had, I was disturbed by the discrepancy. So, while I was standing at the end of the line, I asked a saleswoman whether any laptops, rather than notebooks, were among the "laptops" available at the front of the line. "Laptops and notebooks are the same thing," she replied in a tone that indicted that she didn't think she could possibly be wrong. Matter of factly, I corrected her, and asked her to go the department's main desk to as other employees my question. Although she she said she would check and come back, she seemed more concerned with me standing in the middle of the aisle rather than to a side (to speak with her). She did not return, which gave me that bad taste that she had been more focused on telling me to do something myoptic rather than make good on what she was supposed to do. I went to the desk myself, and as for the products actually there, let's just say I immediately left the store. Can bad management itself, especially concerning rude employees, be unethical?
At the Best Buy store, a salesman told me that the store has a supply of the laptop I had seen on my phone just a hour earlier. It was a "late day sale" not available Friday morning. The salesman went back stage with his supervisor, who also had told me that he was sure that supplies are behind in the back area. Yet when they came back out, the salesman had a laptop that was from another manufacturer and for $70 more. "The last of the laptops you want is being sold right now," he said. He didn't offer to call another store and have a laptop held; ignoring the fact that I would naturally be disappointed, he said with excitement that he had a totally different laptop for just $70 more! He wanted the sale; I could sense the intensity of his greed. I was so disappointed (and disgusted) that I walked away shaking my head in disgust. Later, I called another store and explained. "Unfortunately we can't..." was an answer, I suppose. I then called the original store and asked to speak to a manager about an issue I  had in your store. With conceit, she dismissed me by remarking that all of the managers were busy with customers. No offer to take my number, for the managers would not make the time to call. I was done with Best Buy, I resolved.
Between fighting customers, which I did not witness (but I did see a lot of police stationed in throughout the Walmart store, as if anticipating), and the rude and incompetent customer service (i.e., management, including HR training), and with so many people in the stores, I had a dark thought that I had just seen a glimpse of the underside, or the real nature of, American society so formed by business interests, which of course helps the bottom line. A dog-eat-dog aggressiveness among strangers, and sheer rudeness (i.e., passive aggression) by employees evading accountability and drunk with the momentary power of being in demand for once, for one day. In a commercialized culture, it is particularly easy for retail managers and especially their subordinates to go over-board. It is the aggressive demeanor of the retail employees that struck me most on that Black Friday in which I said to Thanksgiving, so sorry your theme of gratitude is not only run over by eaters bent on pigging out, but also allowed to be immediately followed by such a squalid human nature on display. Do managers revel in their power to dominate or serve customers? It seems that perhaps at many or even most retail businesses, at least in America, the nature of service has never penetrated training. Where contact with customers actually happens, greed and perhaps even a desire to dominate eclipse service. Even in settling on a price, the managers typically make sure the store's position dominates even if this means losing the sale altogether. But the passive aggression (i.e., the hyperthropic urge of the weak, according to Nietzsche, to dominate) is most apparent (and yet it's not!) in disputes with customers. "So sorry, but it is going to be my way; take it or leave it." Are managers so afraid to allow their subordinates no actual discretion, or do the employees themselves relish the power-trip? Moreover, had I seen the logical extreme of unbridled capitialism, or just a capitalist society in full operation?


See related: Bad Management as Unethical: The Case of Walmart, and The Arrogance of False Entitlement, both available at Amazon. 

Tuesday, November 20, 2018

Customers as Members and Guests: Retail Fakeness Infecting Society

“Are you a member of the store?”  A salesperson at a Barnes & Nobles’ café department once asked me the question as I was preparing to pay for the coffee drink I had just ordered. Apparently, customers who had registered for a discount card were considered  “members of the store.” The same thing happened to me at a Borders store before that chain went bankrupt. There, the salesperson refused to take my “No, I am not a member” for an answer—as per company policy.
Let's be clear here: retail stores have customers, not members.  Shopping in a Walmart store especially is not at all like belonging to a country club. To put it bluntly, arrogance is the unavoidable bad odor that fills the air when a bottom-feeder retail presumes to have "guests" and "membors." Once an assistant manager of a Target store insisted that customers are guests even after I had pointed out that people do not have guests over to buy something. Ignoring or refuting a customer's reply adds not only further insult, but belies the original claim, for it is an oxymoron for a host or hostess to be rude to guests. 
Moreover, it is presumptuous for a retail company’s employees (including managers) to act (i.e. lie) as if they really believe that stores naturally have members or guests.  Clubs have members, and people who have guests over do not typically treat them to a sale, as in, "Come on over for dinner, but you have to buy something from me first." The retail employee does not think providing dinner is necessary, but is nevertheless orienting to the selling. If a business is open to the public, it does not make sense to refer to the general public as members or invited guests. The self-serving nature of the pretense or outright lie is too saccurine for my taste. In the domain of religion, such managerial employees would doubtless want a convenient religion that boils down to me, me, me. Only a people-pleaser could serve for long as the cleric in such congregations. 
Lastly, a rather slick elitism is implicit in explicitly distinguishing members from non-members, as in “are you a member?” Even in calling some customers "guests" and others "members" projects an "outsider/insider" dichotomy that is overdrawn (and may even involve passive aggression as well as power-aggrandizement). Is it really in a store's financial interest to make some of its customers feel second class? Imagine a Walmart cashier asking you, "Are you a member?" as if anyone would want to be one! You might break out in uncontrollable laughter. "How utterly arrogant for a bottom-feeder retailer even to assume that membership rightly applies there. 
Moreover, any culture highlighted by “members,” "guests," and “upgrades” being somehow pertaining to retail business may suffer from a more general societal trend that is not transparent. Too often, moderns pretend that vacuous retail phrases have substance--treating emptiness as though it were substance. Just because someone, even a manager, asserts that something is real does not make it so. Ultimately, if customers do not object to the arrogant and erroneous use of the words, member and guest, then the insufferable retail mentality that is fine with such vacuous misnomers is enabled. Pretty soon, the sordid practice could become ubiquitous not only in the business sector, but across society if it is highly commercialized as is the case in the United States relative to the European Union. 
When an employee in a store or at it's customer service call-bank says, “I’m sorry for your inconvenience,” or even uses the word "unfortunately" in such an emotionless tone that the speaker could not possibly feel bad about the customer's bad experience, absolutely no credence is to go with that stock (marketing) reply. It is really to say, "Even though you had a bad experience or have a complaint, we at the store want you to think that we acknowledge some responsibility or obligation due to the store's part." In fact, "we want you to go on buying things here as if the problem were so minor it could not warrant an apology with recompensense." In actuality, an apology without any compensation, monetarily or in terms of merchandise, is not only empty, but also quite insulting, for it is a subtle means of cheating the customer, or "guest." Do retailers really think their customers are so stupid as to think that everything is made right again by an easy apology? Even the authors of customer-service books admit that such apologies are so ubiquitous in business that they count for next to nothing. Who could possibly take such unemotional, easy "apology sans renumeration as a real apology, rather than as a pre-arranged talking point that can even feel as a slap. Authentic apologies would be backed up by some economic sacrifice, rather than a coupon-enticement to buy again as if the matter had been resolved to the customer's real satisfaction). Rarely does a customer demand compensation as a prerequisite for accepting the apology, and also for any coming back to the store. A business is an economic entity; one must treat it as such and transact in economic terms. By a business's own reckoning, "Sorry for any inconvenience" without any economic cost to the business can only be of a distant, hypothetical value unless most of the customers are suckers.


Sunday, November 18, 2018

Commercial Breaks on TV: Antiquated or Here to Stay?

By the end of the first decade of the twenty-first century, the impact of computer technology on television was already promising to be nothing short of revolutionary. Yet people seemed only able to grasp the contours of an upcoming basic shift both in how television would come to be delivered and how programming would be financed and presented. Young adults were on the leading crest of the wave. Even by 2012, they typically watched television programming from laptops and even ipads rather than television sets. Meanwhile, an older demographic was learning how to integrate television screens with the internet such that movies could be downloaded on a laptop and shown on a larger screen, completely bypassing commercial television even stored on “tibo” from interlarding the home.
Being somewhat slow, to say the least, in picking up on computer technology, I was afforded a hint in 2012 of what the new technology portended for television as my viewership dwindled down to PBS, movies on dvds, and television news from abroad available on the internet.  Even after just a few years of this new commercial-less habit, I found the occasional television movie with commercials on TNT and TBS to be rather unpalatable on account of all the commercial breaks. Just a few years earlier, I would have thought nothing of the interruptions. They were as though blinks to eyes. The human brain has an amazing ability to “ignore” the banal if it is taken as a given rather than contingent. It is the shift from “necessary” to “contingent” that the advent of computer technology had already by the second decade of the twenty-first century begun to “awaken” in human consciousness regarding television commercial-breaks. That a perceptual change, if shared by many, could impact society so tremendously in terms of changed mores is the real story here.
In my own experience, watching episodes of Downton Abbey on PBS uninterrupted by commercials for up to two hours at a time afforded me a new viewing experience regarding a television serial beginning in 2010. By the last few episodes of the third season, it had dawned on me that by being so ensconced for an uninterrupted hour or even two in the audio-visual story-world of Downton,  I could really get into that world of the story precisely because my perception of it was sustained. This experience, as well as that of Game of Thrones, gave me a new sense of how full the experience of story-telling can be. That is, being absorbed in a story world a lot and especially without interruption can enable a viewer to really "get into" that world as an assumed context for the narrative. From such a basis, the viewer can more fully appreciate the depth of characterization such as the case in Downton Abbey, whether it be Mr. Carson’s struggles with early twentieth-century “modernity” or granny’s Machiavellian nature, which is not so dark because it is for the good of the family. Moreover, a sustained experience of a fine manner of speaking and of manners can make an impression on a viewer’s own manner. Abstractly put, a more complete and richer experience of story-telling is afforded by the viewer being in the story-world as per a sustained perceptual experience. Returning from such an experience to a “chopped up” movie shown on commercial television, one is apt to find a new impatience with the commercial breaks. Were there really this many before? They are ruining the movie.  The flight away from commercial television has undoubtedly been facilitated as a result. In effect, the new experience had already made the old one obsolete even if the networks had not yet reached this insight.
If my experience of shifting from commercial to non-commercial television and dvds is any indication, the further decline in viewership could make commercial television networks even more desperate for quick-cash programming, such as the low-class American “talk shows” and “reality shows” that make such excellent fodder for weight-loss commercials (yes, “ouch”). The perpetuation of this strategy would only facilitate the flight of the more discerning viewers to less unseemly programming that is available at alternatives to commercial television and even the television set. As commercial-television viewership continues to decline, more pressure to add even more commercials for the networks to break even would mean even more “cheap” programming and more “chopping up” of shows and movies with commercial breaks. More people would be just fine passing on cable or satellite altogether and leaving the television set “unconnected.”
As a result, the role of the television set in the typical house or apartment would change fundamentally, including even how it is perceived. The device would go from something that is always on to something that is only used occasionally and for certain purposes, such as to play a dvd or serve as a larger computer screen for internet or movies. There was a time when I would have freaked out had my television set not been able to receive any channels. I remember the sense of panic when a storm would knock out cable. I’m cut off from the outside world! Even as early as 2013, however, I had become just fine with the “box” being left unconnected. I didn’t even bother hooking up my digital box. I had come to perceive the televsion as something that is to be used with my dvd player. I watched Downton Abbey simply by clicking “watch online” at PBS on my laptop. I felt no desire to watch anything on commercial television. Why go through the motions to be connected? Maybe keeping the home a little less connected is not such a bad thing after all.
Viewing the television set as a device to be occasionally used to play a downloaded movie or dvd would mean no longer seeing the set as something that is to be almost always on or even necessarily hooked up to receive broadcast channels. The addiction to constancy can thus perhaps be broken, if only in terms of television. In a sense, the transformation dimly anticipated even as early as 2013 would be one of increasing quiet, and thus privacy in the home as the outside world that is admitted is more closely narrowed to particular story-worlds of interest, absent exogenous “messages” and even programming.
The change being advanced can be viewed as rather positive in nature. Ironically, removing from the television set its constant airing of programming could return the home to its pre-television quietude. Moreover, the addiction to constancy—such as in constantly smoking or constantly having the television on—may come to be viewed as a distinctly twentieth-century cultural phenomenon. Put another way, activities that in other eras would have been indulged in occasionally may in the context of the twentieth century have fed an addiction to constancy—an almost-obsessive desire to keep doing something notwithstanding the decline in its marginal utility. Often the activity or product constant in use is rather insignificant, and thus easily hackneyed into daily use. Rather than viewing a drink or cigarette as indulged in occasionally for social occasions, “cocktail hour” and “a cigarette with coffee in the morning” (and, indeed, having a coffee every morning) were allowed to become part of the popular culture in the twentieth century, at least in America. The resulting dire health impacts should have given people a hint that items geared by their nature to occasional use at best were part of a compulsive desire for constancy. The regular or even constant use of such banal items overstates their significance.
Although not having the health downside of nicotine or caffeine, television too had come by the 1970s to a constancy not justified by the underlying significance of the programming. “Being connected” meant always having the TV on in one’s house, even if this meant giving up too much control over what enters one’s home (e.g., commercials). The “being connected” to the outside world we allowed to become a constancy. Silence eclipsing the “white noise” was as though tantamount to succumbing unconditionally to a void of existential emptiness. How strange this fear would have sounded to a person living in the Victorian world before even phonographs and telephones, not to mention radios and televisions.
If one had looked to the future from 2012 or even further back in 2010, the question might have been whether computers would come to be sucked into the illusion of constancy-as-fullness, essentially replacing the television set as hegemon in the house. Already by 2013, smartphones and ipods had become the new means for constant connectivity (especially for young adults). Is this sort of constant communication really a deterrent to the sort of boredom that comes with an empty sense of being? Ironically, might there be more fullness of being were stillness or quiet to return as the default in the home? Perhaps a hypertrophic desire to constantly be connected externally undercuts one’s connectivity to oneself and one’s family. Severing the television cable permits an opportunity. The question is perhaps whether we moderns have the stamina to tolerate the resulting sense of void in our homes without instinctively filling it with another means of constant connectivity. Put another way, might the twentieth century household be remembered as an aberration rather than as the beginning of the modern world come into our living rooms? At the very least, the eclipse of commercial television means more control for the viewer in terms of what is admitted into the home.

Wednesday, November 14, 2018

Thanksgiving Elipsed by Christmas: Will the Offending Businesses Go Extinct?

Even as the business-sourced encroachment of Christmas had all but eclipsed the American holiday of Thanksgiving in 2013 on account of the day falling so late in November (as if four weeks were somehow not a long enough time for gift-buying), the on-going trend (or stampede) of stores opening earlier and earlier on Thanksgiving puts the holiday itself in the cross-hairs of the retail rifles. Thanksgiving may one day be essentially extinct, and, ironically, so too might be the usual suspects--the enterprises themselves.
The New York Times reported in mid-November 2011, “Major chains like Target, Macy’s, Best Buy and Kohl’s say they will open for the first time at midnight on Thanksgiving, and Wal-Mart will go even further, with a 10 p.m. Thanksgiving start for deals on some merchandise. . . . To be at or near the front of the line, shoppers say they will now have to leave home hours earlier — in the middle of the turkey dinner for some.”[1] Of course, Wal-Mart stores would be open all day, as usual; the significance of midnight lies only in terms of the sales; the stores would still need to be staffed all day. In 2012, 10 p.m. became the new normal. Two years later, 8 p.m. (20:00h) earned the distinction. Four hours into Thanksgiving was apparently enough for Kmart to “go all the way,” opening at 6 a.m. on Thanksgiving. Old Navy extended back to 9 a.m. It is amazing how fast a trickle from a few cracks can turn into a deluge, especially when profit is the force beckoning the water down-stream. 
Resisting the smooth flow in 2011,  an apparent anti-entropic energy-attractor was on track to blaze a new path. Bill Gentner, senior vice president for marketing for J.C. Penney, refused to go along with herd down the easiest path of energy transduction, which can paradoxically render the person, species, or human organization less fit to adapt via natural selection. “We wanted to give our associates Thanksgiving Day to spend with their families,” Gentner said just before Thanksgiving in 2011.[2]  In standing on this principle, the management group at J.C. Penney voluntarily resisted the “quick buck” (i.e., pulling in money as soon as possible) and perhaps even held business calculation at bay in the face of a normative societal “constraint.” 
Lest I am “gilding the lily” (i.e., painting a halo around Bill Gentner’s head), J.C. Penny’s management may also have been seeking to amass reputational capital with the intent to “spend” it to increase sales revenue  beyond 2011. The company could then be fitter in adapting to a nonlinear (i.e., chaotic) business environment, and thus more likely to survive through the cumulative cascades of natural selection. Linking evolutionary theory to thermodynamics and applying the fused thrust to business, I contend that capturing and concentrating energy in the battery, or storage cell, of reputational capital enables a company to survive under the pressures of natural selection by functioning as a transductor of energy along a high energy gradient. 
Unlike floating down-stream with the other fish, adding to the swirling force of an eddy enables an enterprise act as a conduit on a much steeper energy-gradient. Concentrating acquired energy rather than merely passing it through as though a digestive track is requisite to taking the road less travelled down steeper energy-gradients than those in the status quo. Similar to the time value of money, the delayed gratification enabling an enterprise to ski on a steeper slope renders the organization more fit or adapted to its environment and thus profitable beyond tomorrow. In other words, functioning as an energy-conduit along a steeper gradient profits a business in terms of natural selection, and thus a more secure continued viability.[3]
Alternatively, taking the alternative route, the more convenient one, ultimately leads to extinction. Typically, convenience knows itself as a lie. For example, Holly Thomas, one of Macy’s spokespersons, wrote in an email in 2011 regarding employees working on Thanksgiving, “There are many associates who would prefer to work this time as they appreciate the flexibility it affords their schedules for the holiday weekend.”[4] As if referring to a summer baseball team rather than employees, Molly Snyder, a spokesperson at Target, said that her company does its “best to work around the schedules of [its] team members.” Nevertheless, a Target employee told me that the store managers do not in any sense do their best to accommodate exogenous schedules of the underlings. In going with a bland subterfuge rather than adapting to societal norms, Target's management put the company at odds with the principle of natural selection. 
The lure of instant gratification in lieu of reputational capital and fitness to survive the accretions of natural selection over time can easily short-circuit efforts to charge the battery at the expense of increased sales revenue in the short term. Sadly, the management at J.C. Penny succumbed in 2012 to opening stores at 10 p.m. on Thanksgiving. The following year, the company joined many others in opening at 8 p.m. (20:00h). Nothing punctures a pressurizing balloon quite like that the piercing edge of hypocrisy. Put another way, having stores open on Thanksgiving evening not only cuts into or even eliminates Thanksgiving dinner (i.e., in the evening) for many store managers and non-supervisory employees, but also sends the passive-aggressive message that they don’t count after all. Actions speak louder than words. 
So J.C. Penny’s management wimped out, or lapsed back to the bottle yet without hitting bottom. Being less fit than otherwise to navigate the turgid currents in natural selection over the long term, the retail giant risked being caught unaware should a careening stone hit a sweet spot from a smaller foe releasing a burst of (stored) potential energy to take advantage of a steep energy gradient. From this tale, we can now recognize the tyranny of the road most traveled as a well-worn, deep-rutted path of self-destructive (i.e., dysfunctional) business strategy. In other words, business as usual is woefully far indeed from good business management. Nevertheless, the vast majority of management groups in companies are under the false impression that scientific management has optimized modern management. While technical coordination aimed at the perfection of efficiency is important to a business functioning as an energy-attractor and transductor along a steep slope, the size and depth of the shared blind-spot bewilders me and beguiles the pro-business American society at large. If I am correct, business could be done much, much better.
 
1. Stephanie Clifford, “Thanksgiving as Day to Shop Meets Rejection,” The New York Times, November 11, 2011.
2. Ibid.
3. William C. Frederick, Natural Corporate Management: From the Big Bang to Wall Street (Sheffield, UK: Greenleaf Publishing, 2012).
4. Hadley Malcolm, “Black Friday Backlash as Stores Add to Thanksgiving Hours,” USA Today, November 15, 2011.

Wednesday, November 7, 2018

Does Refusing Rolling Stone Magazine's Use of a Criminal's Picture For Marketing Purposes Violate Corporate Social Responsibility?

In 2013, the editors at Rolling Stone must have been kicking themselves after several retail chains announced that they would not be selling the issue that displays Dzhokhar Tsarnaev as a young hottie. Criminal charges had been made against him for the Boston marathon bombing that took place in April of that year. Selling a magazine by playing off the good looks of a terrorist was more than several—but not all—retailers could stand. Were the offended retailers being socially responsible, or is the matter of CSR not as clear-cut as has typically been assumed.

This picture of Dzhokhar Tsarnaev was on the cover of an issue of the Rolling Stone. From a marketing perspective, why might the editors have selected this particular photo? To which market segment might the choice be oriented? Image Source: hdwallpaperfresh.com  

Tedeschi Foods, a grocery-store chain based in New England, issued a rather emotional statement for a company: “Tedeschi Food Shops supports the need to share the news with everyone, but cannot support actions that serve to glorify the evil actions of anyone. With that being said, we will not be carrying this issue of Rolling Stone. Music and terrorism don’t mix!”[1] Had Rolling Stone’s editors sought to glorify the evil actions of an alleged bomber, or had the intent been to profit from them? If the latter, couldn’t the news companies that splashed pictures of Tsarnaev on the television screen (while not showing commercials) be accused of the very same thing? Music and terrorism may not mix, but selling news and showcasing bombers apparently do. Is the Rolling Stones in the business of news or music?
Rite Aid issued a statement that it too would not be selling the paper, “Out of respect for those affected by the Boston Marathon Bombing.” CVS issued a similar statement. “As a company with deep roots in New England and a strong presence in Boston, we believe this is the right decision out of respect for the victims of the attack and their loved ones.”[2] Did the CVS executives really want to respect the victims, or did the underlying rationale have more to do with the positive PR impact on CVS’s image from “showing” compassion and respect in line with societal norms? The phrases “deep roots in New England” and “strong presence in Boston” can be read as advertisements using pathos, or emotion, to persuade New Englanders and Bostonians to identify with, and thus buy from, the “hometown” company.
Walgreens simply stated that it would not be selling the issue. K-Mart had a similar statement, according to the Huffington Post. Ironically, those two retailers might have been more principled in the decision, as they were less oriented to profiting from their respective announcements.
Bucking this collective push away from the controversial cover, the 7-Eleven convenience-store chain announced that it would be selling the issue. This decision raises the question of whether companies should have identical social policies, given that the relevant societal norm does not differ.[3] Did the 7-Eleven executives make the wrong decision, given the relevant societal norm? Or does that norm conflict with another—namely, that consumers should be the ones to make the decision through their purchasing decisions. The other retailers preempted the consumers from “voting with their wallets.” In other words, the societal norm against popularizing people who did bad things, allegedly or not, conflicts with the value of economic liberty in a market economy. Which is more in line with societal values in the U.S.:  compassion for victims or economic freedom? It depends on which value is or ought to be prioritized. In advocating a fit with societal norms and values, corporate social responsibility cannot say which norm or value should be prioritized—only that the company should closely fit itself with whichever societal norm or value is “picked.” To privilege particular societal norms or values over others as if the emphasis were mandated or implied in being socially responsible makes corporate social responsibility dogmatic in the sense of being arbitrary. That is, it makes CSR ideologically prescriptive rather than a theory explaining why only some companies survive in the long run and a tool being used by managers to steer their companies through choppy waters.
In terms of the Rolling Stone cover, it may indeed be arbitrary for retail chains to boycott the issue after television news networks made so much money off the story by showing the bomber’s picture. In other words, the double-standard may point to the arbitrariness in the corporate social responsibility movement. On the other hand, the retailers (excepting 7-Eleven) may have drawn the line at the magazine cover because the particular head shot together with the Rolling Stone context may have been designed to sell the bomber as a sexy guy—something the television coverage did not do. Whereas profiting by showing various pictures strains a societal norm but does not break it, profiting by sexualizing a young terrorist may indeed cross the line.
At any rate, this case study demonstrates that corporations do indeed differ with respect to how or whether to be socially responsible. That is to say, social responsibility is a judgment call on which people can and do differ.


1. “Rolling Stone’s ‘The Bomber’ Issue Banned By CVS, Walgreens, Rite Aid And Kmart,” The Huffington Post, June 17, 2013.
2. “Rolling Stone’s ‘The Bomber’ Issue Banned By CVS, Walgreens, Rite Aid And Kmart,” The Huffington Post, June 17, 2013.
3. This assumption does not apply to the environment of international business, as different societies have differing societal norms on a given topic.

Saturday, October 27, 2018

The Underbelly of Corporate Charity as Corporate Social Responsibility

Why do corporate managements spend corporate money on charities? The obvious reason is to reduce the amount of corporate income tax due. Yet another motive, not as transparent, has to do with reputational capital, and that motive may also explain corporate social responsibility.
Achieving the low 12.6% effective tax rate was undoubtedly on Bernie Madoff’s mind when he made his firm's charitable contributions. This rationale was by no means unusual at the time.  Furthermore, Madoff would not have been above using charity in order to display himself as a very wealthy person. According to Martin Press, a tax attorney, “If [Madoff] actually gave the money to charity, it is a common theme of Ponzi scheme people to make large charitable contributions to show people how wealthy they are.”[3] The perception of Madoff as a financially successful personally rendered him trustworthy in being capable of making investors rich, and the apparent charitable giving gave the impression of trustworthiness in its normative sense (i.e., honesty and integrity).



Similarly, moreover, corporate strategies may include programs under the rubric of corporate social responsibility as a means of cultivating the impression that the corporation itself is financially successful and trustworthy both in terms of competence and fairness. That is, corporate social responsibility may be more about amassing reputational capital for the corporation than any acknowledged responsibility to society (other than to provide consumers with effective products). 
Lastly, charitable giving can be motivated by the wrong assumption that it can make up morally for unethical policies. In the case of Bernie Madoff, the firm's business was inherently unethical as a ponzi scheme. Besides providing merely a patina of morality, therefore, charitable giving can also be "rationalized" in corporate boardrooms or CEO offices as making up for any unethical policies or conduct. Like any patina, charitable giving specifically and corporate social responsibility more generally cannot make up for a sordid company culture and any unethical policies or conduct within a company. Put another way, fighting the temptation to have an unethical company when expedient is worth more ethically than having a corporate-responsibility program. Theoretically speaking, such a program is not primarily ethical; rather, it narrows the gap between existent corporate and societal norms, whereas an ethical policy or conduct is so because it survives critique of the underlying ethical justification. The difference here is between the is and the ought. To get ought out of is (i.e., business ethics out of a CSR program) is, according to David Hume, the naturalistic fallacy. Norms exist, and therefore are, whereas ethical policies and conduct pertain to what should be. 
Sources:

1.  John Waggoner, “Madoff ‘Donated’ a Lot to Charity,” USA Today, December 13, 2013.
2. Ibid.
3. Ibid.