Norway and business ethics
May 4, 2007
I took a college course on Environmental Business Ethics, where you get the rude awakening how a-moral most businesses are. If the cost savings of dumping chemicals in the river and the PR damage of the event is less than the fine, will a company do it? (Short answer: Yes). Further, once the company starts saving money through unethical practices and shortcuts, will others follow to remain cost competitive? (Short answer: Yes).
Recall the Fight Club narrative: “A new car built by my company leaves somewhere traveling at 60 mph. The rear differential locks up. The car crashes and burns with everyone trapped inside. Now, should we initiate a recall? Take the number of vehicles in the field, A, multiply by the probable rate of failure, B, multiply by the average out-of-court settlement, C. A times B times C equals X. If X is less than the cost of a recall, we don’t do one.”
I’ve actually had family members lose jobs in small towns due to Walmart entering the area – and they still blissfully shop at Walmart weekly with no sense of correlation or causation.
So the article on Norway’s recent investment decision making puts a smile on my face. Nicely done. Now, hopefully we can avoid some of the posturing and political statements of recent Nobel prize choices.