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Chapter 3 –- Truth Telling (pp. 101-142)
Chapter 3 starts with a case study (pp. 101-110) regarding the situation that led to the collapse of
WorldCom, one of the largest telecom companies in the world. Bernie Ebbers had been the
chairperson and CEO of WorldCom and was universally well-liked in the community, but had a
reputation as a tyrant within the company. He was interested in growing the company through
acquisition, and the increasing price of WorldCom stock was the way in which he financed
acquisitions. The stock price rose if greater earnings were reported. In growing the company in this
manner, however, a series of bad accounting practices, which made earnings appear to be higher than
they actually were, had crept into the company and were either overlooked or deliberately allowed.
Cynthia Cooper realized the company was deeply in debt and needed to do something. But what was
she to do?
Article: “Ethical Duties Towards Others: ‘Truthfulness’” by Immanuel Kant (pp. 110-115)
The first article starts on page 110 and is entitled, “Ethical Duties Towards Others: ‘Truthfulness’” by
Immanuel Kant. In this excerpt, Kant speaks about how we communicate with one another. He starts
out by remarking that, “the exchange of our sentiments is the principal factor in social intercourse,
and truth must be the guiding principle.” His main point, of course, is that without truth, anything we
tell one another becomes valueless. And if the things we communicate to one another are of no value,
then we have no society.
Kant goes on to distinguish certain concepts. He talks about the difference between reserve and
secretiveness. Reserve, he believes, is normal. No one, for example, talks about all of their faults and
shortcomings. Secrets, however, consist of information shared by a second party, but with the specific
intent that they not be shared with a third-party.
Article: “Trust, Morality, and International Business” by George G. Brenkert (pp. 115-128)
Brenkert discusses the fact that expanding globalization has brought an increased importance for an
international business ethics. He raises several important questions right away: when are workers in
developing nations being exploited? Which dangerous products should not be shipped across borders?
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When do cash or gifts amount to bribes or extortion? He raises many other issues, including child
labor in the development of large industrial plants in Third World nations.
His article concentrates on trust as one of the most important background bases for international
business ethics.
Trust, for Brenkert, has intrinsic value. Within the business context, he distinguishes three types of
trust — Basic Trust, Guarded Trust, and Extended Trust.
Basic trust is an underlying, impersonal, and systematic form of trust. It is the background form of
trust that exists throughout the social order. For example, when I have bought something for $15, I
ordinarily turn over a $20 bill to the cashier with the expectation that they will not run away with my
money.
Guarded trust is the type of trust necessary to maintain a relationship in the face of our knowledge
that no contract can ever be rendered 100% clear. This type of trust holds only between companies or
individuals who have set up specific agreements. It expires with those agreements.
Extended trust goes beyond both of the above. It requires common motives, consistency of behavior,
acknowledged competence, and openness. It generally exists over a long-term and carries through
from one agreement to the next, and even in the absence of specific agreements for specific
circumstances.
Needless to say, these types of trust build on one another.
Brenkert also points out obstacles to trust in the international business situation. These include the fact
that values and motives may differ dramatically, ethnocentric and egocentric tendencies, possible
racism, past histories, as well as other possible impediments not specifically listed.
The morally relevant features of trust are pointed out as communication and mutual understanding,
morally significant exposure of oneself to others, the restriction of self-interested behavior, and
reciprocity with the intent of fostering autonomy.
Brenkert does not specifically explain how trust is formed in international business relationships.
Article: “Whistle blowing and Professional Responsibility” by Sissela Bok (pp. 128-135)
Bok starts by explaining “whistleblowing” as the sounding of an alarm from within the organization
one is working, with the idea of spotlighting neglect or abuses that threaten the public interest. She
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points out that moral conflicts on several levels exist for anyone contemplating whistleblowing. First,
the decision has to be made as to whether speaking out really is in the public interest — this includes
not only informational considerations but also whether it will cause change for the better. Also, one
has to weigh their responsibility to their workplace and coworkers in their decision to blow the
whistle or not. The third conflict she points to is a personal one — how much risk is one putting
themselves and their loved ones at if they blow the whistle?
Whistleblowing is a compound act that includes dissent, breach of loyalty, and accusation. One who
chooses to blow the whistle must take all of this into account in making their individual moral choice.
It is stressed that the whistleblower should seek as much and as objective advice regarding his choice
as he can before going public, and that he make himself aware of the arguments for and against the
practice of whistle blowing before he himself makes his decision.
Article: “Is Business Bluffing Ethical?” by Albert Carr (pp.136-142)
In his article on business bluffing, Carr points out the generally understood difference between
bluffing and telling an outright lie. He discusses the idea that business has been compared to game
playing, and therefore that the ethics involved in business are game ethics rather than something as
stringent as religious ethics.
On page 141, Carr states, “To be a winner, a man must play to win. This does not mean that he must
be ruthless, cruel, harsh, or treacherous. On the contrary, the better his reputation for integrity,
honesty, and decency, the better his chances of victory will be in the long run. But from time to time
every businessman, like every poker player, is offered a choice between certain loss or bluffing within
the legal rules of the game. If he is not resigned to losing, if he wants to rise in his company and
industry, then in such a crisis he will bluff– and bluff hard.”
Discussion Questions
1. Children often learn early in life that it is not appropriate to be a “snitch.” Why is it not always
considered proper to bring someone’s bad behavior to attention of others?
2. Is it ever proper to lie? Suppose a gunman comes to your house and asks if a loved one is
home – can you justify telling them, “No, they just left” even if your loved one is in the next
room?
3. Who is the one person you trust most? What characteristics about this person and/or your
relationship with them led you to select this particular person?
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Resources for further study — Film, Literature, and the Web:
Lacayo, Richard and Ripley, Amanda. “The Whistleblowers.” “Time.” December 22, 2002.
www.time.com/time/personoftheyear/2002
National Whistleblower Center: http://www.whistleblowers.org/
Wikileaks: http://wikileaks.org/index-en
20th Century with Mike Wallace: The Perils of Whistleblowing. Narr. Mike Wallace. The History
Channel. A&E Television Networks. 2001.
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