The Ethics of Service Revisited

I’ve written in this space before about businesses refusing service to customers because of the owner’s beliefs – most often because the owner of the business has some bias (religious or otherwise) against a specific client. I’m on record as saying that I personally regard this practice as stupid; it violates the First Rule of Business and several aspects of civil behavior, if not (unfortunately) civil rights. The Supreme Court recently ruled that such business practices are legal, however, so that part of the discussion is now off the table (in the United States, at least). But this week there came the story of someone being asked to remove themselves from a public venue not because of their age, gender, ethnicity, religion, socioeconomic status, or sports fan affiliations, but rather because the owner loathed that customer’s politics and the political positions of the customer’s employer. I thought it was time we revisited the issue…

First off, we need to acknowledge that neither members of the far-right political groups nor White House Press Secretaries are protected classes in the United States, nor is refusing to do business with someone because you loath their politics considered a discriminatory policy as such. Despite all of the pearl-clutching indignation rising from the Right, the restaurant owner in question did not commit any crime, Federal or state, when she asked the current Press Secretary to leave her establishment. Nor can these commentators claim any moral grounds for their complaints, since they have been loudly supporting the right of business to refuse service to customers on the basis of gender orientation. But those are the legal and moral aspects of the case; what are the ethics of the situation?

On the one hand, the owner of any business has an ethical obligation to his or her employees, vendors, community members, local taxpayers, and other stakeholders to generate revenue, and hopefully profit. Refusing a paying customer can be seen as ignoring those responsibilities, in addition to being bad business practice in an absolute sense. We could also point out that in most cases the employee does not determine their employer’s policies or politics; a Press Secretary does not make national policy, she just answers questions about it, to take the current example. It is possible that the current Press Secretary, as the daughter of one far-Right politician and a senior advisor to another, might agree with the extreme conservatism that so angered the business owner, but as a general principle we can’t assume this to be the case…

On the other hand, the owner of any business has the same ethical obligation to promote their establishment by appealing to the largest number of customers as possible. Again, I have no data to suggest that most of the patrons of this specific restaurant are particularly left-of-center in their political leanings, or even that they are more liberal than the current Administration, but as a general principle, if the majority of your clientele support any specific position, whether that is the Democratic Party or the Boston Red Sox, it makes some amount of sense to appeal to those same loyalties in running your business. I’m not saying you should throw Yankees fans out of a Red Sox bar, for example, but Yankees fans are not a protected class either, and if ejecting one makes all of your other customers cheer and order another round, you could make a case for it being good for business and supporting at least your first and second bottom lines…

Which brings me to the question: Do we, as business owners or manager, have any ethical responsibility to provide service or sell products to customers whom we despise on a personal or political level? Assuming that the practice does not involve discrimination towards people from any protected class or for anything (age, gender, race, etc.) that is beyond their control, do we have the right to refuse service to such individuals? Does our answer change if doing so would be good for business? Or if serving such individuals will drive away other customers and be bad for business? Or should we just provide services or sell products to anyone who can pay for them, and let all other considerations slide?

It’s worth thinking about…

The Ethics of Expectations Revisited

In my July 2014 post “The Ethics of Expectations” I was writing about the rash of people complaining about, and ultimately suing over, for-profit programs in the culinary arts that ended up costing them tens of thousands of dollars to take, but would only qualify them for $8 to $10 per hour starting jobs. At the time I wasn’t really aware of for-profit schools offering law degrees; it’s not a part of the field to which I pay a lot of attention, and there are already a huge number of law programs available through traditional institutions anyway. Last week’s article about the fallout from the Charlotte School of Law fiasco (and my post on the subject) seem to have re-opened the issue, and I thought a follow-up might be in order…

There is a common perception in some of the States, particularly those with a particularly difficult Bar exam, that provided you can pass the Bar no one will care where you got your law degree. In California, for example, where fewer than half of the people who sit for the exam each year will pass it (and stories about people taking five or six tries to pass are common), it’s difficult to imagine that anyone who did pass would have trouble finding work. Maybe it won’t be the most glamourous (or high-paying) job, but surely there will be something you can do with your new credentials. Unfortunately, this wasn’t true even before the market became glutted with lawyers in the 1990s, and it is even less so now…

Despite the old joke about the person who graduates last in his or her class from medical school still being called “Doctor,” unless you plan to hang out a single and go into practice by yourself the school from which you received your degree will still matter. In a field where there will generally be more applicants than available jobs, such as in legal practice, you will very rapidly encounter situations where a managing partner has a choice between multiple candidates with identical credentials except for the quality of the school that conferred their degrees. At that point priority will probably go to the candidate from the best school, or at least from one that does not have a “horrible” reputation…

At that point, we have to question whether allowing anyone who wants to enter your law program, regardless of their odds of passing the Bar or getting a job afterwards, is any less fraudulent than promising people that they can become a celebrity chef with nothing more than a few months of school and a significant amount of debt. I’m not going to address the shenanigans the Charlotte School of Law (and others) have been pulling with fake scholarships and gaming the student loan system, because that absolutely is fraud, but the question of how bad a student can be before you have an ethical responsibility to tell them to do something else with their money and ambitions is still valid…

The problem becomes even murkier because there really are people who don’t do well on standardized exams like the LSAT, or even in regular classes, who really can excel when actually doing the job. When we include possibilities such as regulatory agencies and corporate positions that require law degrees but do not actually involve legal practice, things become even more convoluted, and when you consider that there are also people who have completed fully accredited law school programs and passed their state Bar who are still failures in practice, the question becomes hard to resolve even in the abstract. So I have to ask:

Do we, as business people or as teachers, have an ethical responsibility to exclude students from educational programs in which we sincerely believe they have no realistic chance of achieving any eventual success? Granted that as decent, caring human beings we don’t want to strand anyone with a huge debt that they can’t repay and no viable job opportunities, do we have any right to tell someone that their commitment and hard work will get them nowhere? Does our answer change if our own employment (and survival) depend on keeping students in school, or at least not driving away paying customers? I’m not suggesting that we have an obligation to keep anyone in a program that we know is beyond their abilities just so that our employers can continue to collect their tuition, but things are rarely that cut-and-dried in the classroom. How do we decide when it would be kinder to cut someone loose than string them along, and where do we draw the line?

It’s worth thinking about…

The Ethics of Loitering

There has been a lot of ink over the past few weeks about the Starbucks incident where some overanxious store employee called the police because a couple of people were waiting for an associate to arrive before they purchased anything. Once again, I don’t think there is any controversy in this particular case; the employee appears to have acted because the people waiting in their store happened to be African-American, while ignoring the fact that many of their customers who aren’t people of color do this all the time. Starbucks responded by closing all of their stores to retrain the staff, and issuing orders to let anyone hang around the store for as long as they want to whether they order anything or not – which makes me wonder how many more of these incidents have happened recently. But regardless of what happened in this specific case, I thought that the company’s response brings up a larger question…

One could argue that as a place of public accommodation, Starbucks has an obligation to extend service to anyone who isn’t actively violating any laws, and that one of the services they offer is a place in which to sit and enjoy your coffee. One could also argue that chasing away people who may be about to place an order is bad for business, and chasing away people because one of the employees has an unreasonable fear of one or more specific demographic groups is bad for the entire company’s reputation and brand image. In that sense, the company’s response and the new standing orders make perfect sense. Anyone who has ever worked in a food service, customer service, or other “public facing” job already knows that there is another side to the story, however…

Sadly, there are people in any society who will abuse anything any product, service, or resource to which they can gain access. If the personnel in a Starbucks store are not allowed to ask anyone to leave for any reason, we can almost guarantee that someone will make inappropriate use of their premises, more likely sooner than later. That might mean relatively harmless things like people using the seating area for an office they don’t pay rent on, or helping themselves to condiments and paper products without buying anything, or it could mean serious problems like homeless people using the store to sleep in, drug users shooting up in the restrooms, or stalkers spending all day watching one or more employees before trying to follow them home…

Any of these latter cases is going to be virtually as bad for business as the conditions that precipitated the company’s policy change, with the added issues of OSHA violations and hostile and offensive working environment suits being a near-certainty. No one, least of all me, is going to suggest that any company should tolerate open or even implied bigotry among its employees, but anyone who doesn’t realize how much harder these measures have made an already difficult job category has never worked a public-facing job in a tough neighborhood. All of which leads me to the question:

Do we, as businesspeople, have an obligation to accept loitering, trespassing, or other inappropriate use of our facilities because a non-zero number of visitors will be offended by anything other than free and unlimited usage of the property? Realistically, some people are going to take offense no matter how carefully we attempt to meet all of their needs and no matter how hard we try to make them feel welcome. By the same token, some of our employees are going to have some discriminatory beliefs no matter how hard we try to screen them out, or how carefully we attempt to train them to keep those opinions to themselves during business hours. Where do we draw the line between trying to never offend anybody (which is impossible) and trying to maintain a perfectly clean, safe, professional working and eating/drinking environment (which is also impossible)?

It’s worth thinking about…

The Ethics of Protests

There has been a great deal of commentary flooding the airwaves over the last few weeks regarding the decision by the NFL to prohibit their players from kneeling during the National Anthem in protest of injustice in America, and specifically the excessive use of force against Americans of African ancestry. I don’t propose to comment on the political or ethical issues surrounding either the injustice or the protests themselves – I don’t actually believe there is any debate that the treatment of persons of color in this country is deplorable, or that the First Amendment to the Constitution gives the players the right to protest the situation. But the NFL ruling itself is being described and defended as a business decision, which brings it into the scope of this blog. I thought we should take a closer look…

First off, it is important to recognize that for all that it acts like a Federal institution, the National Football League is a business, owned and run by private citizens. Functionally it is more like a collective than an actual franchisor, despite the individual team organizations being called “franchises,” but that does not change its legal status. As long as the restrictions are applied equally to all groups and parties within their workforce, the NFL telling the players not to protest something while on the job isn’t really any different from another business telling its employees not to wear MAGA hats while at work, for example. Or, for that matter, asking its personnel to wear clothing that covers any tattoos during working hours…

One could reasonably argue that the NFL’s claim that allowing the protests to continue is bad for their business is not convincing. So far, at least, I haven’t seen any data that suggests that people who are specifically opposed to these protests will stop watching the games, or that any of the advertisers will stop sponsoring the broadcasts. Likewise, the argument that other groups will start demanding equal time is rather dubious; to date no one seems to be staging protests that there aren’t enough people of color being randomly shot by the police, or that First Amendment rights are somehow a bad thing. In fact, over the last few decades there have been any number of players – and occasionally entire teams – wearing special colors or graphics in support of various causes, and this does not appear to have impacted the League’s business success, either…

At the same time, it doesn’t seem unreasonable to suggest that the League is under no obligation to provide their employees with a public forum in which to promote their position, either. If the NFL wants to require their broadcast partners not to air footage of the players kneeling, or deny access to the games to journalists and sportswriters who describe or display pictures of the protests, they would appear to be within their rights to do that. If they attempted to prevent their employees from talking to the press about the protests, or from holding rallies and/or giving speeches in support of their position there might be some difficulty, but if any of the teams or their owners have tried to implement such a restriction there hasn’t been any mention of it so far…

The issue is being complicated by the fact that the issue is inherently political in a way that wearing pink in support of breast cancer awareness or airing commercials in favor of youth sports and fitness is not, to take only the most obvious examples. It is also being complicated by the fact that both the League and the teams make use of the names, uniform numbers, and likenesses of certain players for promotional purposes, in which case the promotion of any particular cause by a player can be interpreted as support for that cause by the NFL itself, if the observer cares to see it that way. But despite these and other complications, the basic question is fairly straightforward…

Does the NFL have the same right to restrict the political and/or social protest activities of its employees while they are in uniform and actively working for League members that any other business has under the same conditions? Does the fact that their employees are public figures, and that the NFL itself has contributed to producing and maintaining those public identities give them rights over the actions or speech of their players that would not apply to other companies? It doesn’t seem reasonable to allow retail associates at The Gap to run through the store with “Free Tibet” banners, or to require McDonald’s to allow its employees to wear PETA regalia while on the job. Should NFL players have greater or lesser freedom of speech than any other American workers? Or should the teams and the league avoid all political and social commentary (at least on camera) and just produce and display athletic competitions?

It’s worth thinking about…

The Ethics of Gun Sales

Here’s another hypothetical for you: Suppose for a moment that you own a retail business, and the child of one of your customers uses something that his/her parent purchased from you to commit a heinous crime. Let us also suppose that the product you sold in entirely legal in your city, county, and state, that ownership of such articles is (debatably) protected by Federal law, and that you have complied with or exceeded the requirements of every law and ordinance that regulates these purchases and your class of business. Let us further suppose that your customer took all measures required by law and all of the measures that a reasonably prudent person would take to secure the article he/she purchased from you, and that their child defeated those measures and precautions in order to get access to the article. What degree of responsibility do you still have for the resulting heinous crime?

Before you answer that, consider what your opinion would be if you owned the company that had manufactured the article used in the aforementioned heinous crime. Suppose that your product was legal to produce in the United States, that you were in full compliance with all state and Federal laws regarding the production, distribution, and sale of your products, and that the heinous crime in question was committed by a person unknown to you in a location hundreds or thousands of miles from any facility that you own. What degree of responsibility would you and/or your company have for the heinous crime mentioned above?

As you’ve probably guessed, there is such a case currently before the courts following the Santa Fe Texas School shooting, as the families of some of the victims have brought suit against the gun store that sold the guns used in the shootings, and the companies that manufactured them. People who identify as pro-gun and/or libertarian are calling these actions absurd, and are comparing them to the lawsuits filed against food companies for making the plaintiffs obese. People who identify as in favor of gun control and/or victim’s rights have responded by saying that if you’re going to manufacture and/or sell devices that make it remarkably easy for a single deranged individual to injure or kill a great many other people in a short period of time, you’re going to have to expect to be held responsible when exactly that happens…

As an amateur historian I actually do have some knowledge of both the inclusion of the Second Amendment in the Bill of Rights and the ways it has been interpreted in modern times, but I’m not going to offer opinions about Constitutional Law without a license. The legal exposure (or lack of it) that these companies might have in this case is up to the court system, not scruffy business bloggers. For now let’s stick to the issue at hand: what ethical responsibility do the people who make and sell guns have for atrocities committed by their customers?

On the one hand, one could argue that any customer could conceivably use any tangible object to commit a crime, regardless of whether or not that object is normally considered to be a weapon. Nothing else appearing, a customer could use the objects you have sold them to stab, bludgeon, or smother their victim, and the number of things that can be used to poison an adult human being are appalling once you start to enumerate them. On the other hand, guns generally have no practical function other than launching small quantities of lead into targets at extremely high velocities. Guns do not, in fact, kill people. They do, however, make it far too easy for people who have one to kill other people. And while there are some people who do have a legitimate need for a gun, decades of historical data covering millions of incidents very clearly establishes that the odds of being killed in a gun mishap (or a gun-related suicide) are several hundred times more likely than the odds of defending one’s self or one’s family with a personal weapon…

All of which brings me to the question: Do we, as business people, have an ethical responsibility to prevent customers from purchasing consumer products that could be used to injure or kill another person, either by them or by someone who has stolen the products? Alternately, do we have the right to tell anyone what kinds of products they should or should not be allowed to purchase, let alone prevent them from doing so by refusing to make and/or sell those products? Even granting that the current gun laws in this country are clearly not sufficient to prevent multiple school shootings every month in America, do we want to have private citizens deciding which Constitutional rights their neighbors should or should not be allowed to exercise? Or should we just make products that people want to buy, offer them for sale at competitive prices, comply with all Federal, state and local laws, and let the people decide for themselves?

It’s worth thinking about…

The Ethics of Profits

I hadn’t intended to follow up on this week’s piece concerning the EpiPen scandal at Mylan because, as usual, I didn’t really think there were two sides to discuss. Anybody who would intentionally charge a 60,900% markup – or even a 600% markup – on a medication that could save someone’s life in an emergency is going beyond simple capitalism into a realm that might get their company (or occasionally their entire industry) placed under government price controls just to keep people from rioting. That is to say, there is no ethical justification for such a policy, according to any standard of which I’m aware. But while it seems obvious that allowing people and organizations to earn some profit is the basis for our entire economic system, the point at which something goes beyond a reasonable profit and into outright exploitation or usury is rather less clear. I thought we should take a closer look…

First off, it should be obvious that in a completely free market it makes no sense to price something at a level that no potential customers can afford, or even at a level that no one would be willing to pay. In fact, pricing strategy to a large extent deals with how many additional purchases we can generate for each increment by which we lower the price; the point at which we can’t increase revenue by lowering the price any further being the price point. If price is the only factor driving the transaction then we probably can allow the “Invisible Hand” professed by Adam Smith and beloved of conservative pundits to sort things out. Unfortunately, conditions in the real world are rarely that simple…

In any situation where the purchase decision is more complex than simply buying the product or not having one additional levels of complexity come into play. One can choose not to pay for a luxury item, but one cannot chose not to pay for food, clothing, shelter, or medical care, just to take the obvious examples. In any situation where different customers have different resources available the situation becomes more complex again, as in cases where some people can afford to purchase food, or pay for medical care, while others in the same society can’t. And when we introduce issues like social stratification, racial discrimination, gender discrimination, transportation, logistics, government regulation, crime, spoilage, and cultural importance of specific goods and services (just to name a few) the entire situation can become baffling complex…

At the same time, we should probably acknowledge that none of the large-scale experiments with command economies, whether partly or fully socialist, appear to have ended up as anything other than complete (and usually repressive) failures. The post-scarcity economies so beloved of utopian philosophers might conceivably be different, but for the moment no such system appears to be technically possible, and thus far in history no system that requires people to sell products or services for what the government says they must (as opposed to what people are willing to pay) appears to have worked. So long as people remain motivated more by personal gain than they are by the greater good, it does not appear than any of these conditions are going to change…

As business people, we know that we would like to make as much profit as possible while at the same time creating the best possible society in which to live and the healthiest world in which to live – not because business people make any claim to being saints or angels (we’re not) but because healthy, prosperous, long-lived customers have more money to spend and more years in which to spend it. And as much as we might like to make a 60,000% profit we don’t want to do so in such a way that we get sued, regulated, mocked by thousands of scruffy bloggers, used as evidence in favor of nationalizing our industry, or that involves having our factory burned to the ground around us. So I have to ask the question:

At what point does our responsibility to our society, our nation or our world supersede our responsibility to our employees, vendors, creditors, customers, and stockholders to earn the highest possible profit on a given transaction?

It’s worth thinking about…

The Ethics of Snowflakes

About a week ago there was a story on the Blaze newsletter site about a company that claims to have developed a pre-screening tool they call a “Snowflake Test,” which appears to be more of a survey about the applicant’s political and philosophical leanings than it is about any particular job skills or abilities. Since the company is taking a position that defies liberal beliefs on a number of dimensions, they are using the common convention of deriding everyone who does not agree with them (and who will not, therefore, be able to pass the “test”) as Snowflakes, or occasionally Precious Snowflakes. If, as the company alleges in the article, their key customers are also opposed to liberal/progressive positions this may be an effective means of recruiting people who will be well suited to interacting with such clients. What is less clear is the ethics of using such a survey. I thought it might be interesting to take a closer look…

To begin with, we should probably note that many companies make use of some form of pre-interview screening. In some cases this will regard job skills, but in others the company will be trying to get a feel for how honest the applicant is, how detail-oriented they are, or how careful they are with financial matters, just to name a few. The idea is usually to avoid wasting either the interviewer’s time or that of the applicant, since if the screening tool can identify some factor that would make the candidate unsuitable for the job there is no need to go through with the interview itself. In some cases the screening may convince the applicant that the company or the position is not a good fit, which will also save everyone’s time. This is the first example I can remember seeing that specifically addresses the applicant’s political and social beliefs, however...

Now, we should probably acknowledge that none of the questions that have surfaced so far have asked anything about an applicant’s age, race, gender, physical ability, physical conditions, marital status, religious affiliations, political affiliations, club affiliations, service organizations supported, charities supported, or any other factor that would be officially considered discriminatory under Federal or State laws. Assuming that none of these survey questions are actually illegal – and the lack of lawsuits suggests that this may be the case – then the company is entirely within its rights to use such a survey, and no one really has any standing to complain about them. People who do not have highly positive feelings about the United States are not a protected class, for example, and neither are people who are strongly opposed to gun control. And while a company-wide bias against people with those opinions might lead to a hostile work environment, it’s difficult to see how avoiding such confrontations hurts anyone…

Without a great deal of internal information I can’t tell you if the company would be more effective with a greater diversity of ideas and philosophies than it is with its current roster. Everything we know about strategy formulation suggests that a groupthink mentality – everyone in the company following the same lines of thought without dissent – limits the effectiveness of the firm and may eventually result in its being too rigid to adapt to changing conditions. One could argue that the company’s leadership owes it to all of the various stakeholders to be as effective as possible, but one could also argue that attempting to hire people who will be compatible with the prevailing company culture would be better for both the company and the new hires. All of which leads me to the question:

All else being equal, and assuming that no laws are broken in either case, does the company’s desire for a cohesive corporate culture, based on shared values and opinions held by the employees, outweigh the company’s responsibility to hire the best and most capable employees regardless of their political, social, economic, or personal convictions? 

It's worth thinking about...

 

The Ethics of Freedom of the Press

On the face of it, this is a non-issue in the way that only an aspect of Constitutional Law can be. The Right to Freedom of the Press cannot be abridged in any fashion anywhere in the United States, and probably shouldn’t be. Certainly, there don’t appear to be any historical examples of government-sponsored censorship, or government controlled media, that turned out to be a good thing. But in a world where almost any information that is released in any fashion can be made accessible to anyone with a computer in a matter of seconds, the question becomes more one of ethics than law anyway. I thought we should take a closer look…

To begin with, despite the things that some people like to claim on the Internet, you can’t really say or print anything you want. The First Amendment protections were never intended to shield anyone from the consequences of actual crimes or of tortious acts. Claiming that an object you are selling is valuable when it isn’t is still fraud, and claiming that someone has defrauded you when they haven’t is still slander, or libel if you publish it. Similarly, the use or distribution of material somebody else wrote, drew, photographed, filmed or otherwise created without their permission is a copyright violation, and generally regarded as theft. But what about a case where there is no law preventing the use of some material, and no practical chance of a civil suit, but the possibility still exists of causing harm – physical, monetary or emotional – to another party?

Consider, if you will, any of the cases where crime scene photos, or pictures taken after an automobile accident, have been leaked or sold and then posted online. There was another one of these in Montana this past week, but you can find similar examples in California and several other states. Depending on the jurisdiction and the appropriate state law, there may or may not be any legal prohibition against releasing these images to the public, or distributing them on the air or over the Internet. One could argue that the people who run television stations and news websites have a fiduciary responsibility to generate revenue for their owners, and that if displaying legally-obtained images increases viewership or site traffic they have a duty to display those images. One could also argue that as journalists they have a duty to inform the public of newsworthy events occurring in their community, even if those events are tragic. But I personally would not want to be the one assigned to explain those principles to a grieving family who had first learned of the loss of a loved one when they saw the footage on the 6:00 news…

I’m quite sure I don’t need to tell anyone reading this post (assuming I have readers) how problematic it would be to have officials at any level of government – or worse, private citizens with “influence” over those officials – decide what information should be available to the public. The potential for abuse in product liability cases alone would be monumental. But at the same time, relying on the conscience, discretion or human decency of those managers in charge of the news media does not appear to be working. All of which brings me to the question:

At what point does the right of the public to know about the conditions, hazards, risks, or misfortunes befalling their community outweigh the right of family, friends, or victims of a tragedy to privacy? Does our answer change depending on how much time has passed since the tragic events, or on how much of a threat the underlying cause of that tragedy poses to the public at large? And even assuming that it was possible to identify such a point, can we trust anyone outside of the media companies themselves to make such a judgement? Or are should we just leave those laws as they stand and hope for the best?

It’s worth thinking about…

The Ethics of the Commons

For almost two centuries, the economic theory known as the Tragedy of the Commons has been used to explain the negative consequences of a completely self-serving standard of behavior on the community at large. The term derives from the idea that if individual townspeople were to use up all of the grass available on the commonly-held pastures there would not be anything left for their neighbors to use for grazing, and therefore the long-term interests of the entire community would be better served by sharing and conserving those resources. A more modern example would be the collapse of the North Atlantic fisheries due to over-fishing, which has decimated an entire industry in the American Northeast. But in recent times this concept has become increasingly obscure, given that it runs counter to most of the common strategies of a Free Market economy, where everyone is assumed to be trying to maximize their own short-term profits at the expense of all competitors. Given some of the recent developments in both the political and economic conditions in this country, and several others around the world, it seemed time we took a closer look at the concept…

In its simplest form, the Tragedy of the Commons argument seems almost self-evident. If we completely use up a resource, common or otherwise, we will not be able to use it in the future. If other groups are also dependent on that resource, then consuming it to the point of destruction will harm not only our future prospects but those of everyone else in the community or industry. Unfortunately, things in an interconnected global marketplace are rarely that simple anymore, and we have begun to encounter versions of the problem where millions or tens of millions of users are attempting to make maximum use of a shared resource. To take a familiar example, if one tourist removes one ounce of rock from Yosemite National Park, this would be trivial, but if each of the four million people who visit the park each year were to remove one ounce each, that would be 250,000 pounds or 125 tons. And since the vast majority of the visitors stay in Yosemite Valley, that would mean 125 tons of rock per year being removed from an area less than seven miles square…

We could also consider examples where failure to take action by large numbers of people can have massive cumulative effects, such as the case of when during a closely-contested election individual voters decide to write in a candidate, or vote for a third-party candidate without any broad public support. Each of those individual voters may believe that his or her specific vote will not make any difference in an election where tens of millions of people will be casting ballots, and to some extent this might be true, but when thousands or millions of people all take up such a belief, the cumulative effect frequently does change the outcome – and sometimes the course of history…

The real problem, at least from a business standpoint, is that it isn’t always clear when a given resource is going to be exhausted, or even how many other firms are depending on it. And, as managers, we have a fiduciary responsibility to our shareholders and a moral responsibility to our employees and the other stakeholders to maintain a profitable company. Of course we’re not going to intentionally wipe out a non-renewable resource just to gain a momentary advantage, but bankrupting the company and all of the people who depend on it in order to meet a conservation goal that may or may not even be necessary does not make sense either.

All of which leads me to the question: At what point does our potential responsibility to our industry, our society, our species, or our planet supersede our responsibility to our employers, whoever and whatever they happen to be? Clearly, we cannot in reason expect to behave as if ours was the only company in the world, just as we would never behave as if we were the only people in the world. But at what point does the risk of destroying something much larger than ourselves override the need to do our jobs?

It’s worth thinking about…

The Ethics of Deep Pockets

There was a news story last week about a family that is suing Apple for damages after a driver who was apparently distracted by a call on Face Time slammed into the back of their car. They are claiming that Apple should have known that people would make Face Time video calls while driving, and should have made some modification to the software that would prevent people from doing so. Leaving aside for the moment the issue of whether or not that’s even technically possible, it seems as though it would be more appropriate for them to sue the distracted driver. After all, Apple didn’t tell him to video chat with someone while driving, and even if Face Time never existed, he could still have been texting, reading a book, or just not paying attention…

I will again remind my readers (assuming I have readers) not to take legal advice from scruffy bloggers without legal qualifications, but it doesn’t take a great deal of training to understand the concept that there are limits to how much money you can obtain by suing an individual, particularly if he or she doesn’t have much of it. By the same token, it doesn’t take a degree in accounting to understand that Apple can be expected to earn more money in the time it is taking you to read this blog post than the average person will make in his or her entire lifetime. This type of action is sometimes called a “Deep Pockets” lawsuit, and is obviously completely legal, but I can help wondering about the ethics of the situation. I thought we should take a closer look...

On the one hand, we could dismiss the family’s lawsuit as simple greed. A good attorney should be able to play upon the sympathies of a jury, considering that the crash in question resulted in the death of a five-year-old girl, and wring a large amount of money from the huge company that put the loaded smartphone into the offending driver’s hand. Millions of dollars (or possibly tens of millions) won’t bring anyone back, but even a token settlement might help bring closure to the family. Alternately, an admission from Apple that their bad product design was at least partly to blame for the tragedy might help some of the people involved deal with their various kinds of guilt. But what if there’s more to it than that?

Since the crash happened, several reporters have confirmed that Apple has patented technology that would allow the company to disable apps on your iPhone if it detects that you are driving a car – you can read the Forbes article here if you want to. If the company really could have prevented the accident, but hadn’t bothered to implement the changes that would have done so, then they might actually have some amount of responsibility for what happened. There’s also the public awareness aspect – people might not pay attention to a single distracted-driving accident, and it’s doubtful that Apple would take notice of one. A huge product-liability case is far more likely to attract attention, however, possibly resulting in product changes or even new laws against operating a videoconferencing app while driving, while at the same time reminding more people about the dangers of distracted driving in the first place…

There’s no way to tell if the technology would actually help, of course – how would your iPhone know that you were driving a car instead of riding in one, for example? And given the number of texting-while-driving accidents that occur each year, and the number of people who are killed in one, it’s not clear if any additional examples would be any more helpful in raising public awareness. But it still begs the question: Does a company have an ethical responsibility to try to prevent people from using their products in idiotic and potentially fatal ways? Do they have an obligation to compensate innocent bystanders who are injured when someone does use one of their products in such a manner? Or is it acceptable for them to sell a product, complete with warnings against doing things that even a small child would know are idiotic, and then absolve themselves from the stupidity of their customers?

It’s worth thinking about…

The Ethics of Admissions

An interesting case came up earlier this week when over 60 Asian-American groups filed a Federal discrimination complaint against Harvard University, claiming that students of Asian ancestry were required to meet higher admission standards that applicants of other racial backgrounds. According to the complaint, the coalition has evidence that all else being equal Asian-American students needed to score 140 points higher than whites, 270 points higher than Hispanics, and 450 points higher than African-American applicants on the SAT in order to have the same chance of admission to private universities, including Harvard. This is a troubling claim, especially if the evidence pans out, but the situation becomes even murkier when we consider that Harvard’s current admissions policies have resulted in a student body that is over 21% Asian-American, despite the fact that people of Asian ancestry make up less than 6% of the population of the United States…

I don’t intend to discuss the relative merits of Affirmative Action in this space – mostly because that’s really a political issue and not a business topic, but also because I don’t believe that I have anything particularly profound to say on the subject. The case can certainly be made that some consideration is due to any number of minority groups for the discriminatory practices that they have experienced and in many cases continue to experience – but one can also quite reasonably argue that any policy that does harm to any person who has never themselves done anything wrong is not just, and solving injustice by creating additional injustice makes no bloody sense. And the whole situation becomes more complex as the number of groups seeking to gain a competitive advantage for themselves rises…

In this specific case, it does not seem reasonable to require one specific group of applicants to have much higher performance in order to receive the same consideration, especially if you consider the popular image of Asian students as quiet, studious, incredibly hard-working and single-minded to be a damaging stereotype (as some advocates clearly do). But, at the same time, it is difficult to explain why being represented in the student body at nearly 400% of your relative representation in the general population is discriminatory. Certainly, there are other minority groups that do not enjoy anything like this level of disproportional admissions, and one could easily imagine any or all of them filing complaints about the preference that is apparently being given to their Asian-American counterparts…

The University has responded to the allegations by stating that their admissions process is based on a holistic reading of all of the applicant’s scores, grades, activities, abilities, writing skills, academic skills, and so on, including whether or not it believes that a given applicant would be a good fit for their program. This is actually very common among elite schools, and may be the only reasonable way to choose between the literally hundreds of applicants for every position in the incoming class. Unfortunately, this doesn’t address the specific complaint the coalition is making; it also doesn’t answer the conflict at the heart of the matter. Is it more important to have a diverse student body (or work force, for that matter), or to provide a completely level playing field for the students who are competing for admission to that school?

On the one hand, no one wants to have to tell any specific applicant group that they will need scores 140 points higher (let alone 450 points higher) than another specific group to be considered for admission. But by the same token, no one wants to tell members of any specific applicant group that none of them are going to be admitted because the incoming class is now made up almost entirely of people from one or two other groups. This is the specific injustice that the Affirmative Action programs were intended to fight in the first place, but now we seem to have reached a situation where we can’t correct the injustice being done to one applicant group without inflicting an equivalent (or even worse) injustice on another. How can we possibly reconcile the desire to have a diverse student body with the need to offer every applicant an equal chance at admission? Or, for that matter, how can we correct the current inequity without making things even worse?

It’s worth thinking about…

The Ethics of Clickbait

I wandered out onto the Internet a few days ago to visit one of the aggregation sites I frequent, and there it was, in big bold print, like a tabloid headline at a checkout counter at the grocery store: “Why is Taylor Swift Buying Up Porno Sites?” If you check out the story, you will find that the pop singer in question isn’t purchasing pornographic web sites, or any other kind, in fact; the article is about public figures buying domain names that include their own name, in order to keep anyone else from starting porn sites (or other unauthorized web pages) under those names. I’m not going to comment on the ethics of that because I don’t believe there is another side to it; creating pornographic material of any kind using the name or likeness of another person without their permission is wrong, and needs no further debate. But the concept of tabloid-style headlines that are used to mislead a person into clicking on an otherwise dull news story (or worse) seems worth a closer look…

We should probably begin by noting that tabloid headlines have existed for at least a century now, as have a variety of other sensationalist publishing practices. The story you found inside many print publications was rarely as interesting as the headline made it sound, precisely because headlines have always been part of a publication’s marketing efforts. Accurately presenting the contents of your articles, rather than adding misleading headlines to draw people to read them became one of the marks of a reputable news organization, and the same standards (good and bad) carried over into radio and television programs once those became available. One could reasonably suggest that Internet headlines following the same standards (collectively known as Clickbait) would be no better or worse than their paper-and-ink predecessors…

On the other extreme we have Internet ads featuring pictures of attractive models, exotic locations, world leaders, unfamiliar plants and animals, or even company logos that have promote stories or entire websites that have nothing to do with the pictures. And while some of these links are clearly fraudulent – there is no magic secret that will change the dimensions of your genitals or motivate outrageously attractive members of the opposite sex to throw themselves at you, to take only the most obvious examples – it isn’t always clear when an online sources is merely amusing and when it is an outright criminal deception until you have clicked on the link. We could simply ignore all Internet headlines and all proffered links, of course, and perhaps we should, but this still does not address the ethics of the situation itself…

The legality of misleading Internet ads, and the extent to which they can be or even should be subject to the same standards of truth in advertising required in other media, is one of those subjects that is still evolving as our society adjusts to life online. My question is much more direct, and hopefully more appropriate to a business blog: what responsibility do we, as managers, have to accurately present links to information, websites or products online as what they honestly are? And under what circumstances is it ethically acceptable to use a salacious or titillating headline in order to draw attention to a story, website or link that does not deserve that attention?

If we are presenting information to the public as Internet journalists, then we must hold ourselves to the same standards of integrity as a print or electronic-media journalist assuming we wish to have any credibility at all, but what if our only goal is to amuse, entertain and develop online relationships with potential customers – as well as convincing them to purchase our products and/or services, of course? If it presents our advertising material to potential customers, generates sales, creates revenue, keeps our company running, generates jobs and salaries for our employees, and produces a reasonable return for our owners it is difficult to say that there is any real harm in convincing people to click on a picture of an attractive model that leads to a website that has nothing to do with the picture. However, no matter how benign our motives might we, we are still misleading the public and using up their bandwidth under false pretenses every time we do this…

It’s worth thinking about…

The Ethics of Overtime

This past week I mentioned the concept of stealing time from the employees, which I should hasten to note does not have any ethical issues; it’s a crime in most of the United States and an outrage anywhere. Hourly personnel must be compensated for each unit of time they work, and if you ask them to exceed the legally mandated standards for a shift they must be paid overtime. Where this question gets murky is when we consider the employees who are not paid on the basis of hours worked; the so-called “exempt” personnel. It has become so common for employers to consider the exempt classification as a blank check that there’s actually a common joke about this: Exempt personnel are called that because they are exempted from having a personal life. But while this is (usually) legal, and almost always stupid, I have to ask if it is also unethical…

First of all, we should probably acknowledge that forcing your employees to continue working beyond the 40 hours of the standard work-week isn’t just offensive to slacker sensibilities, it’s also counter-productive. Years of research on this have shown that individual performance drops off somewhere between 48 and 52 hours per week depending on the individual; if you exceed that point you will actually start getting less work done the more hours you require. Or, to put in another way, forcing your employees to work 60 hours each will generally result in less quality work getting done than if you had just let them leave after 40 hours, while also generating resentment, fatigue, absenteeism, stress-related medical conditions, and resistance/obstruction to management directives. Keep up this policy and you can confidently expect all of your employees with initiative and determination to leave for better jobs, driving the company into an eventual death spiral…

This runs counter to the best interest of the company, the stockholders, and anyone else who has a stake in its success, which may be considered both unethical and a gross violation of fiduciary responsibilities. It also has the effect of lowering the quality of life, working lifespan, and ultimately productivity of your best personnel, which would make this policy appear unethical in its own right. Yet, at the same time, there are numerous examples of industries where a 40-hour week isn’t possible, because tasks in that context take more than 40 hours per week to complete and can’t reasonably be split into multiple shifts – familiar examples being healthcare, childcare, law firms and entertainment. Even worse, at least from the ethical perspective, is the case where work could be completed by a second shift, but the company can’t afford to hire one…

It would be easy to dismiss these cases by saying that if the company can’t afford to meet expenses (payroll or otherwise) it is effectively bankrupt, and should just surrender and end operations – ignoring the fact that this will throw the employees out of work, ruin the stockholders, and possibly destroy the entire community. It would also be easy to dismiss the whole problem by saying that people are not being forced to work in these jobs or go into those careers, and should just quit if the hours are too long- ignoring the fact that sometimes there is no other suitable job available. And perhaps even worse yet is the fact that once we allow one company to squeeze unpaid overtime out of its employees because it faces bankruptcy we are stepping out onto some treacherous ground: how are we to determine who is close enough to the edge to be allowed such an exception, and who is doing this just to save money and fatten the bottom line?

Which brings me to the inevitable question: Under what conditions is it ethically acceptable for a company to demand extra hours of work from its employees just because they are of exempt status and (presumably) want to keep their jobs? If this is excused by the needs of the company, the community or even the nation, how dire must the situation become before this is acceptable, and who gets to decide? Most people would probably prefer working 45 hours a week to being fired outright, just as most firms would prefer hardship to insolvency, but at what point does this stop being a necessity of hard times or difficult industry conditions and become exploitation of people caught on the wrong end of a power imbalance?

It’s worth thinking about…