Sunday, May 4, 2008
Chapter 7: Corporate Ethics and Politics
In this a presidential and gubernatorial election year (for Delaware residents), I believe corporate ethics plays a critical role in the upcoming elections and the political system as a whole. Some people question whether corporations should have a role in politics and the extent of the role. I agree with Professor Silver’s viewpoint that “if they (corporations) respect some critical moral boundaries” and they follow the letter of the law, then political participation should be granted. Corporations add value to the political process and have a vested interest in the outcome of elections. The means and the extent of political participation by corporations should be controlled, to ensure the spirit of the law is followed. Corporations influence the political system by utilizing lobbyists, regulatory capture and campaign contributions. Corporations have skirted the spirit of the law by influencing board members and company employees to contribute to and vote for specific political candidates. Once candidates are in office, corporations expect additional access that average citizens would not be granted. I believe that Freidman’s stockholder theory would support political involvement by corporations, if it positively impacted the bottom-line of a corporation. There are limitations on this theory, such as the corporation abiding by CSR rules and following the political involvement rules to ensure the corporation stays above the law.
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Blending politics and corporations is a horror show. Both are reptilian in their approach to the goal. That is, getting in office and having power for the politician and increasing wealth for the company. And this is okay as this is the very nature of both beasts. However, to marry is going too far. Let's concentrate on just the corporation for a minute. A corporation has no ethics. Once again, it wasn't designed this way. Organizations such as XXX, have negative results because the people on board cannot tell the difference between right and wrong. Due to scope, these consequences usually take longer to materialize, but is the result the same? You can find a ton of articles and books about business ethics about businesses “losing their way,” e.g., WorldCom, Tyco, Enron. You can also sign up for seminars where they preach to “do the right thing.” They paint the world in stark black and white. These resources ask one-dimensional ethical questions, such as, “Should you take kickbacks from suppliers?” For me, ethics in the workplace is varying shades of gray. You have to rely on moral law, that is, does it ‘feel’ wrong? It’s easy to say, “There is right, and there is wrong.” In my management book, Wingtips with Spurs, I address these issue in detail. All major corporations have their written code of conduct. Each one is pretty much just a copy of the others and is a major dust bunny. The next time you walk into someone’s office, ask to see the company code of conduct. Good luck on finding someone who will produce it within five minutes. The moral law is much easier to find and digest. It resides in each of us. Michael L. Gooch, SPHR www.michaellgooch.com
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