Category: Business Ethics

By Posted on Posted in Business Ethics, Customer Service as Marketing, Social and Economic Justice

Bunch of interesting stuff in the latest issue of the British publication Ethical Corporation, all available online.

Among the goodies:

A rather jaundiced view of Apple’s treatment of its customers and the Steve Jobs mystique–also referred to as the “reality distortion field”

A look at diamond mining giant DeBeers and its partnership with Botswana. This is a company much-criticized by activists over the years. Who knew they even had a corporate citizenship department or a board member from the Botswanan government? I’m not ready to award them a Positive Power Spotlight any time soon but I’m glad to see they’re not completely evil.

An examination of Starbucks’ relationships with its workers amid charges that the company that prides itself publicly on social responsibility is in some ways a less union-friendly climate. On one statistic–percentage o employees covered by the corporate health plan–it compares unfavorably with the notorious union buster Wal-Mart.

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By Posted on Posted in Business Ethics, Ethics in Government, Politics

The San Francisco Chronicle interviewed a retired AT&T worker, Mark Klein, who claims he actually observed AT&T diverting copies of pretty much all email–not just the foreign stuff to the National Security Agency.

In an interview Tuesday, he said the NSA set up a system that vacuumed up Internet and phone-call data from ordinary Americans with the cooperation of AT&T. Contrary to the government’s depiction of its surveillance program as aimed at overseas terrorists, Klein said, much of the data sent through AT&T to the NSA was purely domestic. Klein said he believes the NSA was analyzing the records for usage patterns as well as for content.

He said the NSA built a special room to receive data streamed through an AT&T Internet room containing “peering links,” or major connections to other telecom providers. The largest of the links delivered 2.5 gigabits of data – the equivalent of one-quarter of the Encyclopedia Britannica’s text – per second, said Klein, whose documents and eyewitness account form the basis of one of the first lawsuits filed against the telecom giants after the government’s warrantless-surveillance program was reported in the New York Times in December 2005.

How did it work?

The diagram showed splitters, glass prisms that split signals from each network into two identical copies. One copy fed into the secret room. The other proceeded to its destination, he said.

“This splitter was sweeping up everything, vacuum-cleaner-style,” he said. “The NSA is getting everything. These are major pipes that carry not just AT&T’s customers but everybody’s.”

I urge you to contact your representatives i Congress and the Senate (I’ve written to mine) and tell them NOT to allow any amnesty for telecom companies that illegally turned over data to the government.

It as a crime when Google and Yahoo helped send a Chinese activist to jail by giving their records to the Chinese government and it’s a crime that AT&T turned over our e-mails to an agency not authorized to see them.

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By Posted on Posted in Business Ethics, Politics, Publishing

Most book contracts give the publisher the right to sell at a deep discount to book clubs, and to pay much less to the authors on those sales. However, the assumption is that the book club is a distinct and separate entity.

For example, if one of my publishers, Chelsea Green, sold my Grassroots Marketing: Getting Noticed in a Noisy World to Book of the Month Club, I’d get lower royalties, reflecting the deep discount.

But here’s the ethics problem: The New York Times reports on a lawsuit filed by several authors against their publisher, Regnery Publishing–probably the dominant name in books for those with a conservative worldview.

The authors (Jerome R. Corsi, Bill Gertz, Lt. Col. Robert (Buzz) Patterson, Joel Mowbray and Richard Miniter) accuse Regnery of essentially forming a book club of its own with the express intent of defrauding authors out of royalties due, by channeling as many sales as possible into its book club and other wholly-owned enterprises.

In the lawsuit the authors say that Eagle sells or gives away copies of their books to book clubs, newsletters and other organizations owned by Eagle “to avoid or substantially reduce royalty payments to authors.”

This is a rather nasty form of self-dealing, given the small share authors get even under the best of terms. (Yes, I’m a publisher. I know how much publishers have to invest in a book, yada yada–but I’m also a member of the National Writers Union and I’ve seen the way things are stacked against authors in most book deals.)

While I totally disagree with these authors’ view of world and national politics, if what they say is true, I totally support their drive to get their fair share. Selling inventory to oneself in order to pay pennies on the dollar is unethical and disgusting.

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By Posted on Posted in Business Ethics, Ethics: General, Media Ethics, People Helping People

Hey, big CEOs with ethics problems–learn a lesson from Oprah Winfrey. Yes, Oprah, the talkshow queen of daytime television.

She started a leadership school for girls, in South Africa. When she discovered that 15 girls accused a female staffer of sexual assault, she first immediately removed the suspect from contact with the children (and then, noting a climate of fear and intimidation still existed, removed all the dorm matrons and replaced the with faculty), quietly initiated an investigation (in conjunction with law enforcement officials), brought in American experts to help, made several visits to the school, provided counseling and support, etc.

As soon as an arrest had been made, she called a press conference, outlined the steps she had taken, conveyed deep, sincere apologies, and outlined preventative measures for the future.

Here’s a piece of her statement:

This has been one of the most
devastating if not the most devastating experience
of my life. But like all such experiences,
there’s always much to be gained and I think
there’s a lot to be learned. And as Mr. Samuel
said, we are moving forward to create a safe, an
open, and a receptive environment for the girls
and I’m also very grateful to their parents and to
their guardians and their caretakers for their
continued trust and their support in me and also
in the school.
What I know is, is that no one, not the
accused, nor any persons can destroy the dream
that I have held and the dream that each girl
11
continues to hold for herself at this school. And
I am prepared to do whatever is necessary to make
sure that the Oprah Winfrey Leadership Academy for
Girls becomes the safe, the nurturing, and
enriched setting that I had envisioned. A place
capable of fostering the full measure of these
girls’ productivity, of their creativity, and of
their humanity. It will become a model for the
world. With each girl who graduates, we will show
that the resilience of the human spirit is
actually stronger than poverty, it’s stronger than
hatred, it’s stronger than violence, it’s stronger
than trauma and loss, and it’s also stronger than
any abuse. No matter what adversity these girls
have endured in their short lives, and let me
assure you, they have endured a lot, their lights
will not be diminished by this experience.

Joan Stewart of PublicityHound.com has a good piece on this.

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By Posted on Posted in Business Ethics

Two news stories from earlier this month:

First, the CEO of Countrywide Bank is accused by the state of North Carolina of dumping stock shortly before the company’s poor performance became widely known.

What he did was amend his automatic withdrawal plan to sell his shares a whole lot faster–and the second time he did that was just as the stock was cresting. He’s converted $300 million from stock into cash.

The whole idea of an automatic stock sales plan, of course, is to protect against insider trading. Obviously, the system needs some tinkering.

According to the New York Times, North Carolina’s State Treasurer, Richard Moore, wasn’t very happy about this news:

“I’m steaming when I think of the schoolteachers, sanitation workers and firefighters who have taken a loss on this stock and he’s still cashing out,” Mr. Moore said yesterday in an interview. “Where is the sense of shared sacrifice?

North Carolina’s portfolio with Countrywide is about $9.5 million.

Meanwhile, the Wall Street Jourjnal reported that Merrill Lynch had to write off $5.5 billion in third-quarter earnings, directly related to the subprime mortgage crisis and its self-admitted poor oversight. The weird thing is–its stock went up on the day of the announcement. I will never understand the stock market.

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By Posted on Posted in Business Ethics, Social and Economic Justice

Yes, Wal-Mart is the company I love to hate. Yes, even I said marvelous things about W-M in the aftermath of Katrina, and I respect that it has taken a leadership role on organic food and green energy–though not necessarily the way it’s going about those worthwhile endeavors (that’s a subject for another time).

Back in August, 2005, I summed up some of my objections:

I consider Wal-Mart a predatory company. Its supplier policies (demanding 10 percent reductions in contract costs every year, as I understand it) are largely responsible for the wave of outsourcing that has cost thousands of Americans good jobs–and for the severely substandard working conditions that prevail in many of those foreign sweatshops. Its employees subsist on wages so low that many of them are also on government assistance–a quiet subsidy from the United States to the world’s largest retailer, despite it huge profits. When workers in the meat department of one store in Ontario, Canada formed a union, the company closed the entire store rather than recognize the bargaining unit. And the company’s steamroller tactics in bringing in new stores where they’re not wanted and then abandoning many of them after a few years do not make it a good neighbor, in my opinion.

Of course, in the last few months, we’ve become painfuly aware that Wal-Mart and other companies’ reliance on foreign sweatshops may have health and safety consequences for Americans who end up with tainted toothpaste or whatever else China feels like slipping into its exports.

Well, here’s a new Wal-Mart scandal. A group called Good Jobs First has just released a study showing that Wal-Mart systematically attempts to chisel down its property tax assessments. The efforts are based out of corporate headquarters, and have been charted to 36.3 percent of all locations. In other words, Wal-Mart has tried to get its taxes lowered by lowering its claimed property value in more than one in three of it locations. Total amount saved on taxes, even though the company loses more of these fights than it wins: $28.8 million.

We sholldn’t be surprised. After all, this is the same company that has a very clear history of hiring part-timers and keeping them just under the benefit level, so the government essentially subsidizes the health insurance costs the company doesn’t have to pick up. I’d stop shopping there, except that I already don’t shop there.

Remember this next time your kids’ elementary school (funded, in most communities, by property taxes) has to lay off teachers or cut programs.

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By Posted on Posted in Business Ethics, Marketing Techniques and Philosophies

I was absolutely shocked to see a reference to a book by the infamous Canter & Siegel in one of the publishing discussion lists I participate in.

This is the response I sent:

Are they still around? I find their behavior utterly loathsome! Maybe 12 years ago when I was very new with Internet marketing, I ordered Canter & Siegel’s book from a book club–and lo and behold it was, “we invented newsgroup spamming, aren’t we great?”

Yup–these two are the ones who gleefully take credit for inventing spam, and thus killing the Internet as a viable one-to-one and one-to-many communication tool. I’m sure there’s a special circle in Hell reserved for them and a few thousand of their followers. If there is any justice, they will spend lifetimes chained to their computers, deleting unwanted mail until their eyes give out and they get a jolt of electricity every time they fall asleep over their keyboards. I wouldn’t give them a penny, I don’t care *what* they’ve done since.

Normally, if I buy a book I’m not crazy about, I figure it’s my tough luck and I give it away. I had a moral problem with this one, and I returned it for full credit–with a note encouraging them to think about dropping it from their catalog.

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By Posted on Posted in Business Ethics, Customer Service as Marketing, Marketing Techniques and Philosophies, People Helping People

As found in John Kremer’s newsletter from earlier this summer.

This is in very close alignment with the principles I discuss at length in Principled Profit: Marketing That Puts People First. All of it rings true, and I particularly like the truth and humor in #6 and #10.

Excerpted from Andy Sernovitz’s Word of
Mouth Marketing. As CEO of the Word of Mouth Marketing Association,
Sernovitz excerpted the association’s manifesto. Here it is:

1. Happy customers are your best advertising. Make people happy.

2. Marketing is easy. Earn the respect and recommendation of your
customers. They will do your marketing for you, for free.

3. Ethics and good service come first.

4. You are the user experience (not what your ads say you are).

5. Negative word of mouth is an opportunity. Listen and learn.

6. People are already talking. Your only option is to join the conversation.

7. Be interesting, or be invisible.

8. If it’s not worth talking about, it’s not worth doing.

9. Make the story of your company a good one.

10. It is more fun to work at a company that people want to talk about.

11. Use the power of word of mouth to make business treat people better.

12. Honest marketing makes more money.

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By Posted on Posted in Business Ethics, Ethics-International, Marketing Trends/News, Media Ethics, Publishing

One day after Xing’s

And this is exactly what I was hoping for. Now I can post away, knowing that I have a paper trail showing the integrity of my rights ownership.

Bravo! And hmmm, maybe they’ll reword it to cover what they really need without appearing to make a rights grab.

Those links to the two previous posts again:

My original letter (and the overall context)

Xing’s first response

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By Posted on Posted in Business Ethics, Customer Service as Marketing, Ethics-International, Shel's Personal Life

Wow, they’re fast! Points for customer service, for sure. Less than an hour after I posted my query.

But the response was ambiguous, if polite:

Thanks for your message. We appreciate your thoughtful insight into our Terms
& Conditions and will take your comments into consideration. Apologies if your
reservations prevents you from becoming a member.

What this means is that I may join, but I’m not going to post anything useful on the forums until the TOS is changed.

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