The Journal of History     Fall 2003     TABLE OF CONTENTS


Censorship by Management

by Arlene Johnson


The conscious decision to withhold or censor information by management has stymied and confounded legal experts as well as others who value the ideals which enhance the human condition. This paper will attempt to show that corporate management has deliberately and purposefully neglected to inform the public, simply to maintain profitability.

The paper will consist of three sections. The first section will attempt to prove that managerial censorship exists as well as show the results of that censorship. Emphasis will be placed on A. H. Robins Company, although some attention will be devoted to other instances of censorship. The second section will discuss the US government's regulation of business for the purpose of preventing the withholding of information. Lastly, the paper will demonstrate a few whistle blowing efforts and their resulting effects.

Censorship by Management

The managerial decision to withhold information from women as well as the medical profession by A. H. Robins Company was an explosive issue in 1984 when many lawsuits had been filed due to injuries and deaths by women as well as their babies. This caused Judge Lord to decry the complete lack of compassion by the company towards their customers, stating,
"It is not enough to say, 'I did not know,' 'it was not me,' 'look elsewhere,' Lord began. 'Time and time again, each of you has used this kind of argument in refusing to acknowledge your responsibility and in pretending to the world that the chief officers and the directors of your gigantic multinational corporation have no responsibility for the company's acts and omissions...."

'Today as you sit here attempting once more to extricate yourselves fom the legal consequences of your acts, none of you has faced up to the fact hat more than 9,000 women have made claims that they have given up part of their womanhood so that your company might prosper. It is alleged that others gave their lives so you might so prosper. And there stand behind them legions more who have been injured but who have not sought relief in the courts of this land.
I dread to think what would have been the consequences if your victims had been men rather than women, women who seem through some strange quirk of our society's mores to be expected to suffer pain, shame, and humiliation.

If one poor young man were by some act of his-without authority or consent-to inflict such damage upon one woman, he would be jailed for a good portion of the rest of his life. And yet your company, without warning to women, invaded their bodies by the millions and caused them injuries by the thousands. And when the time came for these women to make their claims against your company, you attacked their characters. You inquired into their sexual practices and into the identity of their sex partners. You exposed these women-and ruined families and reputation and careers-in order to intimidate those who would raise their voices against you. You introduced issues that had no relationship whatsoever to the fact that you planted in the bodies of these women instruments of death, of mutilation, of disease.'" (Perry, p. 207).

In 1928, the first commercial IUD, the Grafenburg ring, was introduced (Thornton). The inventor warned at that time, that IUDs should not have tailstrings because bacteria could ascend the string to infest the uterus. Around 1960, the first plastic IUDs were developed and attained a reliable degree of safety (Thornton).

Dr. Hugh Davis, principle inventor of the Dalkon Shield, claimed it was the safest and most reliable product available to prevent pregnancy; more effective than any other IUD or even the Pill (Perry, 1985). However, Susan Perry and Jim Dawson (1985) stated that Dr. Davis' method of selection for a study of women who had been inserted with the Shield, lacked any organization. Moreover, Dr. Davis presented the study as being prospective meaning that he claimed women were chosen for the study at the time that they had their Dalkon Shields inserted, before it could possibly be known how their bodies would react to the devices (Perry). However, much later he admitted that some women were added to the study after the outcome of their experiences with the IUD was already known to him. This would make the study partly retrospective, and questionable to many researchers. In this way, Davis could have decided to include only those women whose experiences with the Dalkon Shield would make the device look good, excluding from the study those who had problems.

Perry states that Davis submitted his draft of the article to the American Journal of Obstetrics & Gynecology only days after the study was completed. Perry indicates that women who might have become pregnant in the last weeks of the study without knowing it yet, would not be reflected in his pregnancy statistics. In fact, this is exactly what happened (Perry). While the journal was considering Davis' paper, Davis extended the study to 14 months. A significant number of pregnancies did occur, making the actual pregnancy rate for the device at the end of the 14 months higher; more than three per cent when calculated using a simple raw calculation of the data, and more than five per cent when calculated using the life table method that Davis had employed. This showed the Dalkon Shield to be decidedly inferior to both the Pill and other IUDs on the market (Perry).

Davis did not, however, correct his journal article (Perry). He chose, instead, to stick by his final statement in the article which stated that the superior performance of the shield intrauterine device makes this technique a first choice method of conception control.

Dr. Davis acknowledges that he later observed a higher pregnancy rate of 2.6 per cent in a small series of patients using the smaller, nulliparous Dalkon Shields (Perry). But, quickly adds, too few women were involved in that informal study to make the results significant. He and Dr. Win Lerner, Co-Inventor of the Dalkon Shield, and later the pharmaceutical company that purchased the Shield, chose to use the more favorable 1.1. per cent statistic from Dr. Davis' original study when promoting both sizes of the device, despite the fact that the smaller size had not been studied.

Company Concerns

Internal memos illustrate the concerns of officials at the A. H. Robins Company about marketing a product in which the composition had changed from that which was tested (Perry). Perry states that "Roy Smith [Director of Product planning for A.H. Robins Company] knew this and it concerned him. In fact, it had concerned him even before A. H. Robins bought the Shield. In a June 10, 1970 memo to C. E. Morton, an A. H. Robins general manager, Smith expressed his doubts about marketing a product so dissimilar to the one Davis had studied. A copy of the memo was also sent to Ernest Bender, vice-president of the A. H. Robins administrative staff." (p. 63) Smith's concern went unheeded (Perry). Moreover, during June 1970, Dr. Lerner warned A. H. Robins officials that the Dalkon Shield's multifilament tail string had a wicking tendency and could carry potentially deadly bacteria to the uterus (Perry). He recommended finding a new material for the string. This warning was widely circulated among A. H. Robins officials in a Dalkon Shield report written by Bob Nickless on June 29, 1970. 'The string or tail situation needs a careful review since the present tail is reported (by Dr. Lerner) to have a wicking tendency,' wrote Nickless (Perry). This memo was sent to 39 A. H. Robins officials.

Perry states that at least one A. H. Robins official, Fred Clark, Medical Director, was concerned about the lack of pre-market testing, or about the appearance of a lack of testing. Two and a half months before the national marketing campaign, Clark complained in a memo circulated among several A. H. Robins officials that the company had no individual data forms documenting the use of either the old or new models of the Dalkon Shield.

Perry states that A. H. Robins had now been put on notice by Thad Earl, one of Robin's own consultants, that the Shield might be causing septic abortions. Yet, company officials made no effort at that time to look into the matter. In fact, they didn't even respond to the letter until three months later (Perry).

Thus, six moths before marketing the device nationally (and only three weeks after purchasing it), A. H. Robins knew that the multifilament string presented a potentially dangerous situation for the women who wore the Shield. Yet, the company never conducted its own wicking studies on the multifilament string during the four years the Shield was on the market (Perry). An unofficial wicking experiment conducted by a quality control supervisor will be addressed under the section on whistle blowing.

Decision to Promote False Claims

Perry states that the company claimed that, "...the shield was 'well suited for nulliparous, as well as multiparous patients' and had 'exceptional patient tolerance.' Davis' findings-including the claim of a 1.1 per cent pregnancy rate, which A. H. Robins now knew was false, were boldly superimposed on a chart...that showed the comparative rates of other IUDs." (p.69)

Moreover, the A. H. Robins protocol for insertion purposely did not mention using an anesthetic; on the contrary, the company claimed the device could be easily inserted in even the most sensitive woman (Perry).

While A. H. Robins labeling and advertisements claimed the device to be safe and effective, the company had not adequately tested the device to back up those claims (Perry). Therefore, when it learned that the pregnancy rate for the Shield was actually higher than the initial study had indicated, it chose to suppress those facts rather than change its advertising claims (Perry).

Responsibility Given to Physicians

Perry states "As is the general industry practice, warnings about the Shield appeared in small print on the final page of the file card. Doctors were cautioned that 'sepsis may result from unclean technic' and 'perforation may result from traumatic insertions.'" (p. 70) These statements implied that any problems with the Shield would be the fault of the doctor, not the device's design (Perry). This later became a major theme of the A. H. Robins defense as an avalanche of lawsuits came down upon the company.

The Cover Up

Regarding instances of infection Perry states that Dr. Preston, "a staff physician who had no training or experience in the ob-gyn field, wrote to a ... doctor what she hoped would be a reassuring letter. 'Reports of infections in Dalkon Shield patients have been rare,' " (p. 77) adding, "In several large studies involving approximately 2,000 patients there were few if any cases of PID (Pelvic Inflammatory Disease). She didn't tell the doctor that those studies were grossly inadequate and that A. H. Robins knew they were inadequate. Nor did she tell him of Wayne Crowder (quality control supervisor) and his wicking experiment. These were secrets A. H. Robins would keep to itself for many months to come." (p.78)

Moreover, Perry states that when Donald Ostergard, an obstetrician and gynecologist teaching at the University of California Medical School at Los Angeles who had already conducted a pregnancy study for A. H. Robins, asked the company to fund a study on bacteriological flora associated with the Dalkon Shield, they turned him down stating, "We just can't fit the price tag for this study into what we see as our needs for this shield over the next year or two." (p.79) Such a study could have determined whether the device caused infection (Perry).

Thad Earl advised the company to recommend that doctors remove the Shield from any patient who became pregnant while wearing it. But A. H. Robins failed to pass that recommendation on to doctors in its labeling for the Shield for almost 18 more months.

Nor was Earl the only A. H. Robins consultant warning the company about septic abortions. John Board at the Medical College of Virginia and his wife, Dr. Anne Board, worked in A. H. Robins' medical services department (Perry). She had alerted the company early in the spring of 1973 as to the concerns of her husband's MCV (Medical College of Virginia) colleagues regarding the Shield (Perry).

Neither Davis nor any of the A. H. Robins officials had any inclination to tell the other doctors that the tail string of the Dalkon Shield was not a standard monofilament string, but a multifilament string that A. H. Robins was 'desperately' trying to replace (Perry).

By the end of 1973, reports of deaths and severe cases of sepsis associated with the Shield were becoming more widely reported (Perry). Still, A. H. Robins officials insisted that the Shield was safe, that it was no worse in this regard than any other IUD (Perry). Indeed, the Lippes Loop and Saf-T-Coil were soon associated with septic deaths, although not nearly as many (Perry).

Compounding the problems were new studies that revealed to doctors across the country what A. H. Robins already knew, that the Shield pregnancy rate was much higher than the claimed 1.1 per cent. In January 1974, a one-year study conducted at the Kaiser-Permanente Medical Center in Sacramento, California, was published in the American Journal of Obstetrics & Gynecology. It reported a 5.6 per cent pregnancy rate among 296 Dalkon Shield wearers (and a high 28.7 per cent removal rate for pain, bleeding, or other medical reasons) (Perry).

This concerned doctors (Perry). Not only was the Shield being linked to an unusual number of septic abortions, but it also was apparent that Shield wearers ran a greater risk of becoming pregnant in the first place.

Corporate Strategy

The company decided something had to be done to clear the Shield's bad name (Perry). The decision took on an even greater urgency when company officials learned in late 1973 that Donald Christian, a doctor in Tucson, Arizona, would soon publish a paper on the Shield and its relationship to septic abortions (Perry). Christian says that after learning of additional deaths, he contacted the FDA and the Centers for Disease Control, but was ignored (Perry). Thereafter, Christian spoke with Ellen Preston, Project Coordinator and physicial-liaison for the Dalkon Shield, 1970-1973, in a tense telephone conversation on November 21, 1973 during which he reiterated what he had told A. H. Robins Company in the spring of that year regarding the deaths associated with the Shield, and that the company had done nothing about the information, and that the salesman dismissed the fact that there was anything wrong with the product at all (Perry).

Perry states that in June 1974, Donald Christian's devastating article on the connection between the Dalkon Shield and fatal cases of sepsis appeared in the American Journal of Obstetrics & Gynecology under the title "Maternal Deaths Associated with an Intrauterine Device."

Federal Drug Administration Hearings

In a hearing conducted by the Federal Drug Administration, Roger Tuttle, A. H. Robins' attorney for the period 1971 to 1976, admitted that Dalkon Shield documents had been destroyed by the company (Perry). "Tuttle's perception was that his 'mandate' for the destruction was to get rid of documents that indicated the 'knowledge and complicity, if any, of top officers in the corporation in what at that stage in the game appeared to be a grim situation' " (Perry, p. 220).

Tuttle said "he believed that A. H. Robins also withheld from...the FDA all memos mentioning the problem of the Shield tail string wicking bacteria into the uterus" (Perry, p. 221).

" 'It was a cover-up, wasn't it?'...[in] dealing with the FDA in 1974 and 1975.

Tuttle, after objecting...and being overruled by [Judge] Cudd, answered, 'Yes, sir' " (Perry, p. 224).

Legal Aspects of the Managerial Decision to Cover Up

Thornton states that "notwithstanding the state of the art, two points are important for the health care lawyer to remember: (1) Certain manufacturers have either incorporated defective designs in IUDs or misrepresented IUD safety or efficiency, and (2) physicians have been negligent by failing to keep informed of contraceptive techniques and health studies. Both these areas of responsibility give rise to breaches of duties and standards of care that, if proven, can bring fair compensation to an injured patient." (p. 44)

Thornton adds that deaths in women using the Dalkon Shield have been brought on by fatal streptococcus pyogene septicemia and severe pelvic infections during pregnancy' as cited in Marshall. "Manufacturer liability is usually based on failure to warn of dangerous side effects, production of a defectively designed product, and strict liability." (p. 44)

Murray Hausknecht states unequivocally, "Almost from the very beginning the company's executives knew the Shield was ineffective and a health hazard. They consistently denied having any knowledge of its dangers, but the evidence produced in the course of lawsuits against Robins shows that the company deliberately suppressed the information." (p. 63)

Hausknecht concludes, "Robins is not unique; it was merely following the normal practices of the industry." (p. 63) I submit that this industry is not unique; it follows the normal practices of many corporations.

A. H. Robins Company simply carried out this deception to prevent their stock from tumbling. Indeed, Stevenson states that a random sample of 100 corporations' annual reports selected from the Fortune 500, showed that in the year following the change in reporting requirements most reported substantially less to their shareholders than to the SEC. Eighty-four of the firms reported to the SEC as multiple-product-line firms, listing more than one category of sales-and-earnings figures. Of those 84, only 36 provided their shareholders with the same figures for the most recent fiscal year, and only five of those provided figures for the preceding four years, as they must in their reports to the SEC. Twelve firms gave sales-and-profits breakdowns in their annual reports to shareholders that differed from the breakdowns furnished to the SEC. Ten reported sales-and-profits figures to the SEC by line of business but gave their shareholders only sales figures by line of business.

Moreover, "manufacturers will not always have adequate economic incentives to disclose nonobvious hazards however, since to do so might discourage sales (Stevenson). And, although the consumer might, to his regret, discover the hazard in the course of using the product, the societal costs would obviously be unacceptable." (p. 128)

Other Cover Ups

During the Vietnam War, a Honeywell shareholder sought to inspect its books and records as part of an effort to induce the firm to cease making antipersonnel weapons that were being sold to the Pentagon for use in that war (Stevenson). His request was part of a plan to bring outside political pressure on the management since there was virtually no chance that he would succeed in getting enough of the other shareholders to join him to alter the composition of the board of directors (Stevenson). The management's denial of access to the information can only be understood, therefore, as growing out of a desire to be spared any embarrassment or political pressure that public exposure of such information might have generated.

Stevenson states that "the lengths to which corporations will go in shielding embarrassing information from the eyes of regulators [and therefore, the public] is ... appalling." (p. 61) The National Traffic and Motor Vehicle Safety Act requires that auto manufacturers send to the National Highway Traffic Safety Administration (NHTSA) copies of all notices, bulletins, and other communications issued to dealers regarding defects in vehicles or equipment produced by the manufacturer and sold by the dealers (Stevenson). Not long after the passage of the Act, General Motors devised a scheme to circumvent the intent. The company simply began to send its written notifications of certain selected defects to its zone managers, who were instructed to pass on the information orally to the dealers within their territories (Stevenson). 3Since there was thus no written notice to dealers, the literal terms of the statute did not require notification of NHTSA." (Stevenson, p. 62)

Communication is the key word in description. GM was fraudulent because it did not deliver written communication to its dealers. I suspect that GM knew that it was breaking the regulation, but its managers felt that they would not be exposed to any governmental penalties if they neglected to write anything down.

Corporate monopoly over the facts puts them in a position to obstruct the formulation of public policy by withholding information, to mislead by releasing information selectively, and to deceive by reporting half-truths and even outright untruths with the assurance that they are safe from challenge because both government and the public lack the information with which to mount an effective challenge to their arguments (Stevenson). Stevenson states that "it is a sad commentary on business morality that the corporate role in the political process is a stranger to none of these techniques." (p. 63)

Stevenson states that the motivations underlying the corporate urge for secrecy are complex and multifarious, and not at all limited to the considerations of economic competition usually advanced in its defense. Stevenson believes that the system would be much improved if some of the barriers of secrecy were broken down adding that a more open corporation would be better for investors, for the public, and for the processes of government. Moreover, Stevenson feels that forcing corporations to be freer in communicating information about their affairs to the world outside would have a salutary effect on their own internal management.

Market forces require companies to advertise their products but at the same time to conceal from consumers information about the qualities of those products (Stevenson). The reasons for this odd behavior have little to do with the cost of generating or disseminating information because usually firms have readily available all the data on product quality that would be of interest to buyers (Stevenson). The incentives to conceal information about product quality grow out of the economics of oligopoly (Stevenson). I feel that managers think that it they made the decision to admit the flaws of their products, sales would decrease, reducing profits.

The evidence of Chrysler Corporation divulging that they errored in not providing their customers with information and recalling the vehicles in question, is but one example of how a company can turn a mistake into the advantage of creating goodwill. I believe that General Motors could learn from Chrysler's example.

Business Practices of a Questionable Nature

Corporate ability to engage in bribery with foreign officials constitutes censorship of another dimension. I believe it is certainly concealing information from consumers and possibly from the federal government as well. Rosenberg states that "payments made to foreign officials to secure or assure sales contracts is a relatively recent addition to ...[the] extensive listing of questionable or illegal business practices." (p. 23) Fortunately, heightened interest in this issue is the result of several spectacular bribery cases such as those which involved United Brands, McDonnell Douglas, Lockhead, and Gulf Oil (Rosenberg).

However, Rosenberg states "there are also indications that the existing anti-bribery legislation is not consistent." (p. 24) Citing Newman, Rosenberg points out that "the Federal Corrupt Practices Act does not outlaw facilitating payments, only requiring that they be disclosed." (p. 24)

Moreover, Rosenberg states that "business today is characterized by pragmatism, by a lack of commitment to strong values, and by a lack of concern for others, reflecting a willingness to do whatever is profitable." (p. 24) Rosenberg, citing Michelman states that "the manager's first duty is to his firm and not to himself." (p. 24)

Rosenberg, citing Michelman, who refers to the kind of individuals managers would like to be, but that their company rules may demand abandoning human values or moral concerns, see fellow employees, suppliers, and customers only as a means to achieve an advantage for their firms.

Sadly, Rosenberg, citing Gwirtzman and Novak, suggests that the life style of most heads of international firms which involves operating with unrestricted power for all practical purposes, and which requires total personal dedication to achieving the paramount goals of increased profitability, simply does not permit such ethical introspection.

Lastly, Rosenberg cites Hogarty and Sims who point to findings that emphasize the profit margin in organizational reward systems which then leads to diminished value of ethical behavior; and that this effect may be particularly significant at the middle levels of the management hierarchy.

What Price Profit?

Thornton states, "It is estimated that ...[A. H. Robins] will pay more than $1 billion to victims worldwide before the litigation is concluded." (p. 45)

Punitive damages are recoverable, when the plaintiff can demonstrate malice, in fact, like a deliberate misrepresentation and the type of fraud demonstrated in Dalkon Shield cases (Thornton).

Thornton continues by stating that their misconducts during production and marketing of the Dalkon Shield has resulted in prima facie findings of fraud, perjury, obstruction of justice, destruction of documents, and other misdeeds, which have damaged their image.

Attorneys for one of the plaintiffs discovered a secret memo which confirmed that the company knew that the Dalkon Shield was unsafe (Perry). Thus, they argued to judges and juries that Robins could not be trusted, that it was covering up, and that it had misled physicians, consumers, and the FDA.

Perry states, "The eight-member jury [in Minnesota] had decided that the Dalkon Shield was defectively designed and manufactured and inadequately tested, and that A. H. Robins had failed to warn doctors of its risks. They awarded punitive damages to punish A. H. Robins for 'willful and indifferent conduct.' " (p. 196)

Ironically, by the end of May 1974, A. H. Robins debated taking the Shield off the market (Perry). They decided not to do so because 47 lawsuits totaling in excess of $25 million had been filed and their attorney argued that such a recall would harm the company's position in court. It would be a confession of liability and Robins could lose many of the pending lawsuits.

State and Federal Regulations

Clearly, federal regulations are one of the remedies needed to counteract the avarice of the corporate community. Without regulations the tendency of management to circumvent decent standards of behavior can become overwhelming. Even with regulations, we observe management attempting to reduce accountability.

At about the same time as Dr. Davis was inventing the Dalkon Shield, a Health, Education, and Welfare study group found that "ten deaths and a startling 8,000 injuries were attributed to IUDs." (Perry, p. 132)

There was speculation that copper was an inhibiting agent for conception (Perry). However, A. H. Robins "told the FDA that the copper was in the Shield only to give it more flexibility and strength and to make the device visible to x-rays;" A. H. Robins argued that it should be classified as a device, not a drug, and therefore, exempted from any testing (Perry). At that time no formal regulations existed for medical devices (Perry).

That A. H. Robins could convince the FDA that the Shield was a device was far from a foregone conclusion. In October 1971, Ken Moore, A. H. Robins' project manager for the Shield, said in an in-house memo "that the company didn't have much basis for telling the FDA the copper was added to improve the physical properties of the Shield. The copper 'does not and never was intended to contribute to the above-mentioned properties [flexibility and strength],' he said. 'Therefore we are in a very vulnerable position, in my opinion.' " (Perry, p. 134-5)

Russell Stevenson feels that efforts to deal with the undesirable consequences of the pursuit of profits in a free market economy have largely taken the form of direct regulation of those activities that give rise to problems. Lately, however, there is an increasing awareness of the cumbersome nature of this sort of regulation and of the costs imposed on productive activity (Stevenson). One of the consequences of this perception has been a marked increase in the use of institutional mechanisms designed to bring about changes in corporate behavior indirectly rather than utilizing regulations (Stevenson). In the last few years this trend has merged with the political movement toward greater openness in the functioning of governmental institutions (Stevenson).

Stevenson notes that "In the last decade [1970s] or so the use of disclosure as a means of consumer protection has mushroomed. Congress and some state legislatures have enacted a rapidly increasing number of statutory disclosure requirements, and mandated disclosure has also been used increasingly by regulatory agencies, particularly the Federal Trade Commission." (p. 123)

The Magnuson-Moss Warranty Act provides a safeguard to consumers which stipulates and implements regulations principally that no warranty may be called a full warranty unless it meets certain specifications, and that all warranties must clearly delineate anything that the consumer must do to avail himself of their provisions (Stevenson). The law also requires that the warranty be available for inspection at the point of sale (Stevenson).

Additionally, the Act was intended in part to provide consumers with an additional basis on which to choose products by supplying them with certain warranty information in advance of sale (Stevenson). Stevenson questions, however, whether the Act does in fact achieve any meaningful results along those lines.

If the information provided to consumers is to be useful, it must be furnished in a form that permits comparison between competing products (Stevenson). In some markets, however, producers have failed or refused to agree on standards of testing or measurement to be used by all, with the result that at best, advertising data on important product quality is of little value to buyers, and at worst, manufacturers are tempted to give out misleading information (Stevenson).

This was what happened with the automobile tire industry until the passage of the National Traffic and Motor Vehicle Safety Act, which calls for tire manufacturers to provide retail tire buyers with certain information relative to the safety and performance of automobile and truck tires (Stevenson).

Rosenberg, citing Jones, states that "government restrictions and regulation are the principal impediments to US export growth with the FCPA [Federal Corrupt Practices Act] having been included in the category of restrictive legislation." (p. 24)

Moreover, Rosenberg states that "there is a growing force within the US business community which argues that multinational companies 'are important instruments of national power which should not be constrained by simplistic notions of business morals.'" (p. 24)

To accommodate the corporate desire of eliminating or at least severely restricting federal regulations, corporate America elected Ronald Reagan who came into office having promised to "get government off our backs," a code phrase meaning less government regulation and few social initiatives (Frederick, p. 152). His election has led to a partial dismantling and overall weakening of the federal regulatory structure. Indeed, I believe that the Reagan administration encouraged corporations to do whatever necessary to secure the highest profits possible through its policy on deregulation.

In my opinion, this attitude is a sad commentary as to what could be a more ideal scenario. Multinational corporations need to realize that they would stand better in people's stead if they considered their obligations to people. Additionally, the corporate world would likely benefit as well. What we are experiencing today, as we deal with the situation in the US, could be rectified if management would realize that a little compassion instead of interminable profits would make for a more congenial society with less expense to themselves and the federal government. Would the corporate structure listen if consumers wrote letters or Emails advising multinationals that they would enhance their image if they would carry out a kinder and gentler demeanor? Possibly if enough people would undertake this action.

Frederick feels that unless we are willing to acknowledge that the problem of corporate social responsibility lies deep within the business order itself, within the central values that activate and sustain the whole, there is little prospect of finding a solution to present difficulties. Moreover, Frederick feels that a business value system mired in profit-only motives is unable to respond fully and adequately to the social challenges of our times, while nonbusiness values more compatible with the needs of the populace simmer beneath the surface without institutional structure.

How can we change the cultural values of American society? The cultural values of American society would be greatly improved if they adopted the ideology of those peoples who do not practice American capitalism. American capitalism is a cut-throat beat out the other guy system, but there are other forms of capitalism which do not practice this concept. Let us adopt that system. But how? Possibly the next section of this paper will demonstrate.

The Whistle Blower

A. H. Robins was not without its whistle blower (Perry). Wayne Crowder was a supervisor of a quality control department for the company. He suspected that the Dalkon Shield's multifilament string conducted bacteria to the uterus (Perry). He therefore, conducted an experiment to confirm or deny this theory (Perry). The experiment confirmed that this was actually true (Perry). When he called his supervisor to his lab and demonstrated the string's wicking tendency, his boss was anything but pleased (Perry). The supervisor angrily reminded Crowder that the string was not Crowder's responsibility and that he should leave it alone. Crowder told Ross that he could not, in good conscience, keep quiet about something that he felt could cause infection in the women who wore the Shield (Perry).

"'Your conscience doesn't pay your salary,' Crowder says Ross replied. Ross also told Crowder that he was being insubordinate by pursuing this matter; if he valued his job he would do as he was told and forget about the string." (Perry, p. 82) Within one year after Wayne Crowder's impassioned plea for justice, the company fired him.

Wayne Crowder was able to see justice done, however (Perry). He testified at the FDA on what he found to be true with the multifilament string (Perry). While he did not get rewarded in any way, at least he had the satisfaction of being able to salvage whatever was possible for the millions of women worldwide who might have not otherwise been helped (Perry).

Bristol-Myers Squibb Company pleaded guilty to violating the Federal Clean Water Act by discharging chemicals that polluted a lake in Syracuse, New York after the company's environmental specialist quit because she was so frustrated that the recommendations went unheeded by the company (Hays).

Hays stated that the company was fined $3.5 million. Additionally, the company agreed to build a wastewater treatment plant which Federal and state officials estimate could cost as much as $30 million. Already, the company has spent $35 million in other innovations such as emissions control equipment and a new storm sewer system (Hays). In addition to all that money, the company has agreed to pay $682,000 for studies and to pay the Atlantic States Legal Foundation's legal fees (Hays). I am skeptical that the company would have volunteered to do these deeds if they had not been apprehended by government regulators.

Frederick feels that business itself is responsible for the disruptions of the social, ethical, and legal fabric rather than nonbusiness phenomena imposed on business from the outside. Left to its own devices and inclinations, business operating in an unregulated market system produces these effects in the communities in which it operates (Frederick). The issues and problems that have been at the heart of the social responsibility debate are a natural consequence of the institutionalized quest for profits normally sought through the free market (Frederick).

Frederick wonders what it would take to genuinely advance in the art of social responsibility? It would take a development that we are not likely to witness in today's political climate (Frederick).

There is legislation on the federal books to pay whistleblowers I believe. We need to enforce that legislation.


It seems clear that managerial censorship exists. The desire for large profits overrules the ethical tendencies of a wide array of employees. Despite the best intentions of individual employees upon hire to any given company, the Davids cannot compete with the Goliaths of the multinational corporations and acquiesce to their strength for fear of losing their position for which they have worked so diligently.

I think if we can convince multinational companies that it is in their best interest to comply with regulations explaining to them that the cost of damage control is not worth the expense. Of course, this endeavor is an uphill battle. There really is no easy answer. It is my sincerest hope that over time, corporate management will come to realize what the rest of us already know.

Hope is on the horizon, however. B. Joseph White, Dean of The University of Michigan M.B.A. program, requires his students to include an assignment in their curriculum which places them in decaying neighborhoods and community service organizations for a short period. This experience led to a year-long involvement for many of the students (Cuff). In this way, students will acquire leadership on social, racial, and environmental problems (Cuff). Dean White believes that other business schools have low marks for their efforts to prepare tomorrow's business leaders (Cuff).

This could be the beginning of a breakthrough for society. Only time will tell.

Editor's note: I completed this paper in May 1992 as part of the requirements to earn the Masters of Library Science (MLS) degree at Pratt Institute, Brooklyn, New York. The advice provided by Professor Trudy Downs has been attempted to be complied with in this article. The grade for the paper was an "A-" because the professor wished that I had devoted more space to solutions which would alleviate the problems than just stating the problems.

The only way in which a more benevolent corporate structure could ever be achieved, as Professor Downs suggests is first to make many people aware of the problems, and then to force legislation to re-regulate thereby stripping away the loss of regulation which began with Ronald Reagan, whose presidency began in 1981 and ended in 1989, and has continued with subsequent presidents.

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