Using Corporate Offices to Speak Out

It was an occasion that remains memorable 20 years later. There was the president of little American Motors, George Romney, testifying before the Senate Antitrust Subcommittee and telling it like it is about General Motors and Ford Motor Co.

In addition to providing valuable insights about how giant companies can reduce competition and innovation in their industry if not abolish it entirely, Romney’s classic exposition was memorable for another reason. It was an altogether too rare performance. Corporate executives are more effectively contained than generals and admirals from straying off their reservation and criticizing their own institutions.

Corporate culture is a very inhibitory part of society where men of great wealth and power learn to think what they say instead of say what they think. They are not restrained in pouring invectives on big bad government (except that government which subsidizes them) or consumer, environmental and tax reform groups.

But when it comes to speaking out on abuses that afflict their so-called competitors or that are simply matters of public interest, “mum’s the word.”

More recently, I suggested to Mr. Romney that he convene a number of retired chief executive officers of large corporations at an open forum and have them speak freely about their former industries. In one speech after another they could let the world know what they knew about banking, insurance, food processing, steel, drugs, autos, nuclear and other businesses but were reluctant to divulge. What a salutary impact such a gathering would have on the men and women in these industries.

Few of the tragedies or scandals that are made public were not known too many people in private. The area of intercorporate bribery, for example, has continued to prosper. Yet few executives have ever spoken out against a practice which undermines meritorious competition, corrupts giver and taker alike and drives out honest business ways.

Here are some other samples.

Soft drink manufacturers long have known about the contamination of drinking water by heavy metals and other chemicals, They have installed modern purification technology in their operations as a result. The American people have not been told of their knowledge.

Even worse, these executives see their sales going up if nothing is done to clean up the water. Is it their business to sound the alarm? As neighbors, human beings or parents, yes. But their business role dominates their other roles so silence is the norm.

Several drug company executives are known to oppose the advertising of over-the-counter medicines on television. They think that no useful information can be transmitted but that the chances for misleading impressions are great. Denmark does not allow such advertising. These executives remain silent because they do not want to rile their colleagues in the industry.

A retired vice president of Citibank in charge of the trust department had severe reservations about the way Walter Wriston, Citibank chief, was managing the trusts. He kept his thoughts to himself.

Orange juice processors know which companies practice water adulteration of fresh orange juice. They grumble privately.

How long can a society tolerate such serious self-censorship? As long as it wants to suffer the consequences. And with risk levels of modern technology and policy issues going up year by year, isn’t it time for some leadership and courage to emerge from the business community at least to examine this pattern of silence?

Consumer and environmental groups like to say that they were the first to alert the public to many health, safety and economic abuses. Whether in the areas of pesticides, food additives, defective cars–to name a few–this is very largely true.

But they were not the first to know about their abuses–business and industrial insiders were the first. Engineers, chemists and other specialists in these companies also knew.

If these insiders adhered to the ethical or professional standards that they stand by in theory, innocent victims would have been protected by an early alert system and the deterrence that such a system generates to prevent recurrence of such injustices.

Someone with business credentials, active or retired, is needed to start this reawakening. George Romney, somewhere in Michigan, are you ready?