World's Most Ethical Companies 2009

Interesting that three American arms manufacturers made the top of the list. Hm.

Is there something inherently unethical about being in the aerospace and defense industry?

I think Toubab is emphasizing the *ARMS* manufacturing division.

There is an ethical concern for the aerospace and defense industry. One of the companies in that list, The Aerospace Corporation, is essentially an ethics "cop" for the Department of Defense (DoD.) Mammoth DoD contracts can really be given out to a handful of companies for various reasons (some due to the technical complexity, others are security related,) so there really isn't as much open competition. Hence, this niche (but huge in terms of dollars) market has a lot of quirks.

One of them is how contracts work in the industry. For example, imagine Honeywell gets a contract to build a system that does 10 specific functions, but fails to deliver on three of those functions. DoD is not going to say "That's it! We're not going to work with Honeywell again. We're going to exclusively use Lockheed for these types of jobs in the future." Instead, they'll frown at Honeywell, but then renegotiate and ask how much more they have to give Honeywell so that the missing three functions can be added to the system. It's a really messed up market, but that's the reality.

Because of the exclusive, sensitive, and extremely technical nature of the aerospace and defense industry, there aren't that many major players, so a handful of people have a lot of say in this area. Considering the size of defense contracts, there is a huge temptation to influence key personnel when it comes to winning bids. You can google for Boeing's Pentagon procurement scandal, and subsequently their unexpected loss of the mid-flight refueling tanker contract (which itself became another scandal because apparently Northrop/Airbus has to give Boeing a share of that contract through subcontracts now.)

So while Toubab might have been implying that manufacturing arms and ethics don't quite go hand in hand, I'm saying that this exclusive, sensitive and small (in size) industry is essentially an ethical minefield that one has to navigate carefully as well.

I agree with that aspect, xenok. Certainly there have been plenty of instances where there were kickbacks or other benefits given to purchasing agents to secure contracts, and I wasn't suggesting there was an absence of unethical behavior in the industry. I would say there's probably a higher than average potential for unethical behavior in any government contracting, because of the dollars involved and the political nature of government.

I just took exception to the implication that the companies in the A&D industry are unethical solely because of what they produce.

As Xenok pointed out, the incredibly high barriers to entry into the defense market drive out many of the forces of competition that drive quality and innovation in regular markets. In fact, there are legal barriers that essentially prohibit many smaller firms from even getting involved with defense goods contracting; and the level of cronyism and corruption within the world of DoD contracting is, literally, legendary. That might simply be a symptom of an area of government procurement where budgets are terribly bloated and money is spent for the sake of spending it (so Congress can go back and say "look how much we spent on 'the military' this year!"), but I think it would take quite a leap for many of those companies to clear the hurdle of ethical behavior that's considered "normal" in the greater business world.

And yes, I'm also not sure how ethical your company can be while it's producing implements of warfare and mayhem. Particularly when the way those weapons are used are so grossly out of step with any coherent principle of ethics. Necessary in the real world? Maybe. Ethical? Only if you're trying to kid yourself.

And yes, I'm also not sure how ethical your company can be while it's producing implements of warfare and mayhem. Particularly when the way those weapons are used are so grossly out of step with any coherent principle of ethics. Necessary in the real world? Maybe. Ethical? Only if you're trying to kid yourself.



-- Weapons seem pretty necessary in the real world. Is it ethical to defend yourself? Absolutely.

I find that list rediculious. Doesn't nike use child labor in asia? Aerospace Corp, they do research for the military?

Trader Joes I agree with.

I'm reminded of the quote from Orwell:

They don't do research for the military per se. They are essentially the ombudsman/supervisors of huge defense contracts.

When the DoD hands out a fat lucrative contract asking some company to do something secretive and extremely complex, they need people who have the necessary security clearance and technical know-how to review the delivered items. That's where Aerospace Corp comes in. AC basically reviews everything that is delivered to the DoD and also checks up on the progress of the project.

For example, imagine DoD asks Lockheed to do some really complex analysis and provide design improvements to the F-22. How is the DoD going to know if the analysis done by Lockheed is indeed accurate, and the design drawings are not just done in Photoshop? That's where Aerospace Corp and their army of Ph.D.s come in and do the job for DoD.

That may not be the only thing Aerospace Corp does, but I believe that's their main area of expertise, and all the people I know in that company essentially do that kind of stuff.

Yeah, I'd probably be really screwed if we hadn't committed genocide in Vietnam or gone to war in Iraq or bankrolled Israel's "defense" force.

Soooo ethics of what the companies actually produce, aside, it seems that the methodology is based around:

This reminds me of one of the people who wrote my LoR struggling with ethics questions. His point is very valid. You are either ethical and you do not do unethical things or you do make decisions that would be considered unethical. If I've never seen you do anything unethical how do I rank you 1%? 50%?

It's very hard to be more Ethical than someone else. Maybe I'm being glass half full but you can only be more unethical than someone else - I think they should have made the list about the most unethical companies.