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Ethics Panel at California State
University of Monterey Bay – April 1, 2004
By ORVILLE MYERS
The Herald
Originally published Friday, April 2, 2004
Mary Kay Crockett as moderator asked each panelist (Jim
Bracher, Basil Mills and Paul Baszucki) to introduce themselves
and describe what integrity meant to them. She introduced
herself as a recent retiree following 30 years at Merrill
Lynch.
Jim Bracher introduced himself as a consultant. He went
on to describe integrity as including character among
the eight attributes, and defined character by repeating
what an eight-year old member of the Boys and Girls Club
had said: “character is what you do when nobody
is watching.” Jim went on to tell of an experience
he had with Mary Kay Crockett. It seems that, long ago,
Jim and his wife, Jane, had purchased a home from Mary
Kay. Some few years after the purchase, it was discovered
that the sewer lines had never been connected to the home,
and a neighbor's property had been getting the sewage
from the Bracher's home. When he told Mary Kay about the
issue, she immediately volunteered to, and then did, repair
the damage at her expense—even though she was not
the original owner; even though she had no legal obligation
to do anything, but because it was the right thing to
do! Integrity is what people do when they know it is the
right thing to do, even if not a legally required action.
Basil Mills introduced himself, and told the audience
that the Agricultural industry was in a situation where
they were dealing with perishable products, and therefore
had to trust one another.
Paul Baszucki, in his introductory remarks, commented
that a business would make more money in the long run
if it established long-term relationships with customers
built upon trust. Further, that a business would be more
profitable if it experienced low turnover of its employees,
and that this would be the result if employees trusted
the company.
The students then offered their questions:
1. What strategy should management follow to help employees
live up to an integrity standard, and to hold management
to such standards?
Paul Baszucki responded that many businesses used employee
surveys to determine which managers were acting properly;
then the offending managers were given the change to improve,
and if they did not, would be replaced. Further, an employee
should not stay with a company if that company failed
to live up to the standards the employee expected.
2. How should university professors prepare students
for integrity in business?
Jim Bracher told the audience that internships were critical
to learn about integrity in business, and that professors
should encourage students to obtain as many internships
as they could during their university years.
3. What about outsourcing? Where is the integrity in
taking jobs from Americans and putting them overseas?
Mary Kay noted that outsourcing seemed to be a “sea-change”
in how business is conducted, much like the industrial
revolution itself.
Jim noted that the audience needed to look in the mirror,
because the driving force was lower prices. He further
noted to the students that most of the jobs going overseas
were jobs difficult to fill in the U.S., because “you
wouldn't want them.”
Paul said that the answer really was that the U.S. is
an engine of economic growth. He pointed out that, 30
years ago, there was no Microsoft, which has created a
ton of jobs both here and abroad.
A faculty member interjected, what is the impact on the
middle class?
Paul said that there are millions of jobs created in
small companies through out the land, supporting a middle
class. He noted that jobs do change over time.
4. What about Wal-Mart? They are in the news, closing
a lot of small businesses?
Paul Baszucki responded that our free market system operates
to give consumers what they want, and if Wal-Mart better
served the consumer, they would survive the competition
for the consumer. He noted that they usually offered lower
prices to the consumer than the businesses they replaced.
A faculty member then raised the additional question,
“doesn't Wal-Mart hire undocumented workers?”
Basil Mills answered that the statement is misleading;
that Wal-Mart probably had documentation, but that the
documentation was not true or correct. He pointed out
that the agricultural industry has a large problem with
workers who present documentation so that they appear
to be in the country legally with the right to work, but
that the documentation turns out in some cases to be a
fraud.
He said that, before the 9-11 incidents, Congress was
working on a solution to the issue as it affected the
Mexican border illegal immigrants, but has not returned
to deal with the issue since that time.
5. Do you (the panel) believe the penalties being applied
to Martha Stewart and other white color crimes are appropriate?
Jim Bracher told two stories (about his barber, and about
the gentleman who shined his shoes) that illustrated that
people believe large-scale white-collar criminals are
given lighter sentences at nicer prisons (country-clubs)
than other criminals. Jim said that it was important,
when a white-collar criminal was convicted, that they
be punished—but that he did believe Martha Stewart
had been made an example of, and perhaps too much so.
Paul Baszucki indicated that it is necessary to prosecute
white collar criminals so that people will trust in the
system. He further said that Martha Stewart stole, maybe,
$50,000—while others stole in the hundreds of millions,
and with them we should lock them up and throw the key
away.
Mary Kay Crockett pointed out that Martha was not prosecuted
for insider trading, but rather for lying and obstructing
justice. Paul said that we should lock up people who do
that and throw the key away.
6. At what age do you teach children integrity?
Jim Bracher responded that you begin teaching children
integrity very early in their life, and you do it be example.
Jim then told the story of the eight year-old child in
the Boys and Girls Clubs of Monterey Bay who replied,
when asked what character was, “Character is what
you do when no one is watching you.”
7. Can something be illegal, and yet be ethical?
The panelists did not directly answer this question.
This writer observes that people who engage in civil disobedience
to laws that they hold to be immoral are engaging in activity
that is illegal, yet can be highly ethical—as the
early citizens who provided the “underground railroad”
to enable slaves to escape to freedom in the Northern
states early in the history of the United States of America;
or the German citizens who protected their Jewish neighbors
from the Nazi death camps by hiding them from the police,
or helping them escape to the West.
8. Are companies who excessively earn profits by taking
resources from other countries behaving ethically?
The panelists engaged in wide ranging discussion, but
the sense of their comments was that the question becomes
one of whose definition of the word “excessive?”
Certainly it is unethical to take “excessive”
resources from another country—if the word itself
can be commonly defined. Countries need to set ground
rules before the “taking” of the resources.
9. (From a faculty member) Is it ethical to do business
with companies who exploit human rights, such as the use
of child labor by Nike and similar companies?
Paul Baszucki said that there needs to be a “win-win”
balance in decisions, as these affect all stakeholders
in the decisions. It is good to ask, “Would my mother,
would my family, be happy with my decision?” If
the answer is “no,” then don't do it.
Jim Bracher and Basil Mills agreed that the ethical consumer
is the real answer. That consumers should avoid buying
products made by companies who exploit child labor and
engage in other human rights abuses; that recent history
has shown examples that the consumer will do that, when
the truth is brought to light, bringing pressure on the
offending company to stop their unethical practices.
10. Are you obligated to become a whistleblower when
you know you might lose your job?
Basil Mills commented that companies cannot fire whistleblowers
and get away with it! Jim Bracher observed that if you
find yourself in a situation where the people in your
company are engaging in unethical practices, you should
use internal grievance procedures to get these identified
and corrected; that if you find this process ineffective
or working to your own disadvantage, you should find another
place to work.
11. To Jim Bracher: As a former Minister, did you find
there are ethics in the Ministry?
Jim responded that, beyond the instructions of scripture,
there is an understanding that “if it doesn't feel
right, then don't do it.”
12. Are so-called non-compete agreements ethical?
Paul Baszucki responded that you are always entitled
to have a job utilizing your knowledge and skills; but,
that companies are entitled to prevent you from sharing
their specific intellectual property with competitors.
There are many types of activities that an employer wishes
to prevent. Disclosure of proprietary information is one;
stealing of other employees is another, and the stealing
of customers is yet another. General non-compete agreements
are often not enforceable, but employers can usually enforce
non-solicitation agreements not to “steal”
their employees and non-disclosure agreements to protect
their customer lists. It is ethical to prevent theft;
it is not ethical to prevent someone from using their
professional skills and knowledge.
13. The panel contains successful people. Can you give
us tips on how you were able to be so successful?
Jim Bracher answered in a word, “Listening.”
Paul Baszucki replied that having a high energy level
and the right attitude was key, to which Basil Mills added
that we can control our attitude, even when we cannot
control anything else.
Jim added that lament is a waste of time; that you need
to make yourself vulnerable, admit you need help, and
ask for it. Having mentors was particularly important,
and Jim added that he had benefited from 12, whose pictures
hang on the walls of his company's boardroom.
Paul Baszucki said that a fundamental question was: “Do
you want to be successful, or not?”
14. What about medical ethics? There is not enough funding
for rare diseases, while things like AIDS and Cancer receive
a lot of funding.
Jim Bracher told of his own experience with macular
degeneration, and the lack of research funding to deal
with that disease. Paul Baszucki added that you set the
tone for medical ethics one person at a time, and observe
the need to lead medical companies with integrity. The
discussion expanded to general questions of medical research,
with the comment that recent articles suggested that mapping
the blood flow to cut off the blood supply to cancer was
a high potential area of research that needed more funding.
Jim Bracher commented that the grant-writing system that
generates funds for medical research is broken.
14. How can you get the word out when you see something
that is wrong?
Paul Baszucki said, “It is not a perfect world,
but you need to take the matter up the chain of command.
If you cannot get the condition changed, then consider
leaving.”
Basil Mills said that you should take a positive stance,
and you can sometimes change people. Jim Bracher agreed,
saying that it was important to have clarity.
15. Should Affirmative Action still have a place in society
today?
Paul Baszucki indicated that, while enforced racial goals
were not a good idea, the voluntary implementation of
affirmative action was simply good business.
16. When dealing with other countries—international
ethics, whose ethics do you use? Do we have a right to
tell other countries how to do things? What about “baksheesh”
or “guanxi?”
The panelists asked Dan Halloran to comment. Dan replied
that, out of his own experience, it was necessary to view
business issues internationally through the word integrity—doing
what you say you will do, and telling the truth about
what you did. He said that what is ethical will vary from
culture to culture, but that integrity was a more universal
concept and valued in all cultures. Dan went on to say
that businesspeople in other countries are well aware
that the United States has specific practices that are
considered ethical, while others are viewed as unethical.
But if an American business person follows American ethics,
is clear about what his or her practices are, does what
he or she promises, tells the truth and is consistent,
then he or she will acquire a reputation for integrity,
and earn more business over time.
At Motorola, where Dan spent his career, he said that
the polices were clear, that gift-giving or receiving
in order to obtain a business advantage was totally unacceptable.
In China, “guanxi” is part of the business
culture, yet Motorola did not engage in the practice.
Over time, our integrity was valued, and Motorola has
been highly successful in China.
17. What do you do when one of your top performers is
a jerk, yet makes money for the company? Do you teach
or fire him?
Paul Baszucki responded that you must give the person
a chance to understand what behaviors are unacceptable
and an opportunity to improve; however, if the individual's
behavior continues such that the risk is greater than
the return, you must let him or her go. If the behavior
is a character problem, then you must act as soon as that
is clear. Paul indicated that life should be a process
of constant improvement, listening, and further improvement.
Basil Mills told the story of Cesar Chavez, who certainly
raised the level of discomfort in the industry, and how
Basil had joined the board of an association of which
Cesar was a member. He said that you do the right thing,
even if it is not popular. He further said that he continuously
learns, and that he believes in a process of lifelong
learning.
Jim Bracher told the story of an employee in his experience
who suggested to Jim that he could immediately improve
his profits by 40% by cutting service—that this
employee clearly was not of the same value set, and had
to leave.
18. Does the practice of corporate spying happen a lot?
Should we just ignore the issue as an aberration? Is it
ethical? What if your boss asks you to do it?
Paul Baszucki pointed out that you can obtain a great
deal of competitive information from legitimate sources—10K
reports, newspaper articles, patterns of advertising,
etc., and therefore illegal spying efforts are really
not necessary. However, it does happen, and it is illegal.
Jim Bracher said that, yes, it does go on, and is unethical—and
if you are asked to do it by your boss, either move up
the chain of command or find another employer.
Basil Mills said that it gets back to how you obtain
the information. Use sources that are legitimate.
19. To Jim Bracher: In your eight core values of integrity,
is the “handshake” a realistic business process?
Jim Bracher deferred the question to Basil Mills, stating
that the row-crop farming industry was an excellent example
of the “verbal handshake.”
Basil Mills explained that in his industry, the product
is perishable, and therefore the industry must operate
on trust—there just isn't time to go through lengthy
contractual processes. They have a saying, “sell
it or smell it,” that describes the urgency of the
process. Basil went on to describe the Produce Reporter
Company “Blue Book” and the Packer newsletter's
“Redbook” that are 100 year-old financial
reporting firms that report on the character, finances
and credit history of people in agribusiness that help
to keep the trust climate alive.
Mary Kay Crockett volunteered that the securities industry
operates somewhat the same way that securities sales are
done by phone and internet, and therefore trust between
buyer, seller and broker must be substantive and stable
to secure the process.
20. How big is too big? Wal-Mart versus small business—where
do you draw the line ethically? Shouldn't Wal-Mart be
concerned about the businesses they hurt? Should you be
concerned about whom you hurt in competition?
Basil Mills responded that a good competitor helps everybody,
by growing the market and providing new industry practices
and innovation. He went on to describe the “five
a day” program that many competitive businesses
are promoting in the agribusiness industry to help fight
obesity by encouraging people to have five servings of
fruits and vegetables every day.
Paul Baszucki reminded everyone that we live in a free
market economy and that competition is a necessary part
of that, and the best survive.
Jim Bracher pointed out that, unless free markets regulate
themselves, governments will.
21. There have been a lot of scandals—do you think
the practice of unethical decisions will stop? When will
it stop?
Paul Baszucki replied that it is necessary to apply real
penalties to white collar crime, because there will always
be a very small minority of people willing to break the
rules to gain a short-term advantage. Leaders have a responsibility
to lead the way.
Basil Mills described the agribusiness leaders' efforts
in the Salinas Valley to create and integrity-based leadership
program to help lead the way.
22. What about the consumption of fossil fuels? Aren't
we being unethical in the disproportionate share that
we consume, and won't these be gone within another 100
years?
Mary Kay Crockett stressed that we have a responsibility
to conserve, and to research alternative fuels.
Basil Mills said that the world will change, and necessity
will bring new fuels.
23. To Basil Mills: What about the issue of pesticides
in agriculture?
Basil responded that, through research, agriculture has
been able to reduce the amount of pesticides substantially
through the years, and continually has found more desirable
alternatives to use.
Basil informed the audience that the US spends about
10% of Gross Domestic Product (GDP) on food, compared
to 14% in the rest of the world, and that the American
Farmer provides food for more than our own population
because of our productivity.
23. What about integrity in the media? Big media conglomerates
are wiping out small TV companies, etc., and controlling
the news. What happens to fair and accurate reporting?
Recall the Hearst story.
Paul Baszucki cautioned the audience not to place a value
judgment on the word “big.” Further, with
the internet, it seems there are more opportunities to
get the truth, thus encouraging all media companies to
tell the truth. He suggested there is more information
out there and available to consumers than ever before.
24. How do you maintain a balance between family and
business?
Mary Kay Crockett took the question, and said that she
is a living example, being forced back into the work environment
when her children were very young, and provide for the
family herself. She worked for Merrill Lynch for 30 years,
and was able to do so because she sought out a support
system of family and friends to help her through the difficulties.
She suggested that a single Mother needs to do that. If
there is none, then the society's welfare system does
provide some help.
25. Is it ethical for companies to give or sell their
file of information on you to other companies?
As time was running out on the session, the panelists
assured the audience that it is not ethical, and in some
cases illegal for companies to sell your private information
given to them in trust.
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