Ken Mackey has been an inspiration to me since hearing of him in Ken’s IN interview. He’s the CEO of Whole Foods and is implementing many of Ken’s ideas into his business. However the below has given me pause to ponder.
I want to make it clear that I am not claiming that Mackey intentionally tried to manipulate stock prices but that the article seems to suggest as much. The quoted blogger after the article seems to have received the same impression by his choice of words. But if Mackey did indeed do so that would certainly be a greivous breach of law and ethics. Even if he did not it certainly calls into question the ethics of such behaviour, given his privileged position in this particular context.
Here’s a Wall Street Journal article on Mackey’s participation in a Yahoo stocks message board. Could these tactics be justified as “integral?â€Â
Note: the embedded links in the article did not trasfer upon copying. You can find them in the original article linked above.
Whole Foods CEO Mackey Posted Comments on Stock Message Board By DAVID KESMODEL and JOHN R. WILKE
July 11, 2007 6:03 p.m.
In January 2005, someone using the name “Rahodeb†went online to a Yahoo stock-market forum and posted this opinion: No company would want to buy Wild Oats Markets Inc., a natural-foods grocer, at its price then of about $8 a share.
“Would Whole Foods buy OATS?†Rahodeb asked, using Wild Oats’ stock symbol. “Almost surely not at current prices. What would they gain? OATS locations are too small.†Rahodeb speculated that Wild Oats eventually would be sold after sliding into bankruptcy or when its stock price dipped below $5. A month later, Rahodeb wrote that Wild Oats’ management “clearly doesn’t know what it is doing… OATS has no value and no future.â€Â
The comments were typical of the banter on Internet message boards for stocks – but the identity of the writer was anything but. Rahodeb was the online pseudonym for John Mackey, co-founder and chief executive of Whole Foods Market Inc. Earlier this year, his company agreed to buy Wild Oats for $565 million.
For about eight years until last August, Mr. Mackey posted voluminous messages on Yahoo’s stock forums as Rahodeb, the company confirms. The moniker is an anagram for Deborah, which happens to be the name of Mr. Mackey’s wife. Rahodeb routinely cheered Whole Foods’ financial results, trumpeted his personal gains on the stock, and bashed Wild Oats.
Rahodeb even defended Mr. Mackey’s haircut when another user poked fun at a photograph in Whole Foods’ annual report. “I like Mackey’s haircut,†Rahodeb said. “I think he looks cute!â€Â
Mr. Mackey’s online alter ego came to light in a document made public late Tuesday by the Federal Trade Commission in its lawsuit seeking to block the Whole Foods-Wild Oats deal. The 45-page filing, submitted under seal when the lawsuit was filed in June, includes a quote from the Yahoo site in which Mr. Mackey said “the writing is on the wall†for Wild Oats. An FTC footnote said, “As here, Mr. Mackey often posted to Internet sites pseudonymously, often using the name Rahodeb.â€Â
Whole Foods didn’t authenticate each and every one of Rahodeb’s postings as being from Mr. Mackey, who declined to be interviewed. However, the company said in a statement that among millions of documents the company gave the FTC were postings Mr. Mackey made from 1999 to 2006 “under an alias to avoid having his comments associated with the Company and to avoid others placing too much emphasis on his remarks.†The statement said, “Many of the opinions expressed in these postings now have far less relevance than when they were written.†A spokeswoman for Wild Oats declined to comment.
Mr. Mackey, a 53-year-old vegan, co-founded Whole Foods in 1980. He built the Austin, Texas, company into the world’s largest organic and natural-foods grocer, in part by acquiring many smaller chains. Like Whole Foods itself, Mr. Mackey is unconventional. He slashed his annual salary to $1 starting last January, explaining later that “this is what my heart is telling me is the appropriate thing to do right now.†Outspoken and opinionated, he writes his own blog on the company’s Web site. (Read the blog.)
READ RAHODEB’S COMMENTS
Rahodeb’s farewell comment to the Yahoo message board for Whole Foods stock in August 2006:
http://tinyurl.com/24vtow
In the following entry, Rahodeb says the fundamentals of Wild Oats shares haven’t improved and that its stock price had risen merely because of speculation of a buyout:
http://tinyurl.com/267oc7
In the following dispatch, Rahodeb lambastes a Yahoo user who claimed Wild Oats had been a takeover target at $14 to $16 a share:
http://tinyurl.com/23el99
In this entry, Rahodeb predicts that Whole Foods shares will one day trade at more than $800:
http://tinyurl.com/2bz3ow
In the following, Rahodeb claims Whole Foods shares are undervalued and Wild Oats is overvalued:
http://tinyurl.com/2hrrkt
Note: Whole Foods didn’t authenticate each and every one of Rahodeb’s postings as being from Mr. Mackey. But the company and Mr. Mackey confirmed that he made numerous postings under the name Rahodeb from 1999 to 2006.
MORE
Whole Foods confirms that John Mackey used an alias in making comments about the company’s stock on Yahoo’s Web site:
http://www.wholefoodsmarket.com/ftchearingupdates/faq.html
A link to John Mackey’s blog:
http://www.wholefoodsmarket.com/blogs/jm/
Read the full text of the FTC complaint and the FTC document released July 10.
Whole Foods CEO Has Heated Words for FTC
06/27/2007
CEO’s Words May Cook Whole Foods
06/20/2007
Whole Foods agreed in February to acquire Wild Oats, of Boulder, Colo., for $18.50 a share. The FTC sued to block the deal on antitrust grounds in U.S. District Court in Washington, D.C., saying the combination would reduce competition and raise prices for consumers.
To buttress its case, the FTC is trying to use Mr. Mackey’s words against him. In its lawsuit, it quoted Mr. Mackey informing other Whole Foods board members that buying Wild Oats would enable the company to “avoid nasty price wars†in several markets and reduce the chance that a big conventional grocer like Kroger Co. would create a competing national natural-foods retailer.
When that part of the FTC’s suit became public, Mr. Mackey fired back at the agency with a 14,000-word treatise on his blog. He accused the government of “bullying tactics,†failing to do its homework, and taking out of context “macho posturing†by executives that is common to competitive organizations.
Rahodeb began posting messages about Whole Foods shares on Yahoo.com in the late 1990s. He quickly gained a reputation as being one of the stock’s biggest cheerleaders, and gamely defended himself when other posters chastised him for being too rosy. “I’ve never pretended to be anything but enthusiastic about WFMI,†he wrote in 2000, using Whole Foods’ stock symbol. “I admit to my bias – I love the company and I’m in for the long haul. I shop at Whole Foods. I own a great deal of its stock. I’m aligned with the mission and values of the company… Is there something wrong with this?â€Â
Rahodeb often expressed pride in the work of Mr. Mackey. “While I’m not a ‘Mackey groupie,’ †he wrote in 2000, “I do admire what the man has accomplished – building a $1.6 billion business from scratch is quite an achievement.†He then asked another user, “whtmewrry 99,†what he or she had accomplished by comparison. (The poster doesn’t appear to have replied.)
By 2005, Whole Foods had grown to more than 160 stores and its annual sales were $4 billion, making it the leading player in the natural and organic foods sector. In a message in January of that year, Rahodeb predicted great things for Whole Foods’ stock. “13 years from now Whole Foods will be a $800+ stock before splits,†he wrote. “Whole Foods is a tremendous growth stock.†At the time, the shares traded at about $94. Whole Foods’ shares closed yesterday at $39.50, up $1.03, or 2.68%.
Rahodeb often sparred with other users, deploying a rigorous analysis of financial statements. “Your quarterly cash flow variance isn’t statistically meaningful because the time period is too short,†he complained to another user who had criticized Whole Foods in March 2006. He then pasted a summary of the previous six years of Whole Foods’ operating cash flow. “Over the past 5 years operating cash flow has increased 330%,†Rahodeb noted.
When it came to Wild Oats, Whole Foods’ main rival, Rahodeb didn’t pull punches. He often criticized Perry Odak, Wild Oats’ former CEO, who resigned last year. “While Odak was trying to figure out the business and conducting expensive ‘research studies,’ to help him figure things out, Whole Foods was signing and opening large stores in OATS territories,†Rahodeb wrote in 2005. “Odak drove off most of the long-term OATS natural foods managers†and brought in executives who “didn’t know too much about the natural/organics industry or their customers.â€Â
Mr. Odak, in a telephone interview, said he was aware of critical postings, but had no idea Mr. Mackey might have been behind them. “It doesn’t surprise me,†he added.
When on occasion Rahodeb went without posting for several weeks, some users expressed concern about his whereabouts. On at least one occasion, he reassured them that he’d been away but was keeping abreast of the chat.
Last August, Rahodeb filed his last dispatch on the Whole Foods message board. He said he’d lost a bet with “hubris12000†about Whole Foods’ stock performance; the terms of the bet required that he stop posting. He blamed the whims of the stock market for a 40% decline in the company’s shares.
“Whole Foods itself has a very bright future, and I will continue to hold my stock for a very long time,†he wrote. “I’ve enjoyed my 8 years on this Board, but all things must come to an end. I wish everyone the very best. Hog152-keep the faith. Liberfar-good luck with your market-timing game. Hubris12000-take your profits while you can.â€Â
Write to David Kesmodel at david.kesmodel@wsj.com and John R. Wilke at john.wilke@wsj.com
Here’s part of another blogger’s opinion at http://www.informationarbitrage.com:
“Did it ever occur to him that maybe, just maybe, his postings using a pseudonym were in violation of a pretty important securities law? Did anyone in the company know about this like, say, company counsel? I don’t even know where to begin as it relates to governance best-practices. This is such a horrible example of corporate stewardship that it is truly mind-boggling. Through his actions, which I will assume for the moment were fueled by ego and not the conscious desire to manipulate stock prices, he has jeopardized the very brand and franchise he and thousands of employees have worked so hard to build over almost 30 years. Did this ever occur to him as he was posting as Rahodeb that he could be placing his company, his employees and his stockholders at risk? I’d assume not. But isn’t this part and parcel of being the CEO of a public company? I’d say so.â€Â
Here’s what Bill said in the zaadz/ii pod. It raises an interesting issue of whether one can conduct “business as usual” within an integral framework. From this link: http://pods.zaadz.com/ii/discussions/view/162162
Based both on my personal experience, and in the information and stories about business that we have available, it’s extremely hard, and perhaps impossible, to stay in higher types of consciousness while doing business consciousness and activities.
It may be completely impossible to do a competitive business and stay in higher types of consciousness, and suceed and thrive. It’s pretty cutthroat out there.
An interesting point to raise.
It might be interesting to try to define some ways in which a person could operate a business while staying in higher levels and using more integrated ethics.
Here’s the opinion of a Silicon Valley blogger, Vindu, at http://www.mercextra.com/blogs/vindu/2007/07/11/whole-deception-ceo-of-whole-foods-used-fake-name-to-hype-stock-on-yahoo-message-board/
In its corporate values statement, Whole Foods Market claims that its business practices are just as wholesome as its food. Integrity, open books, self-responsibility and fairness are all supposed to be part of the company’s operating philosophy.
I’m not a securities lawyer, but Mackey’s actions smack of blatant stock-market manipulation. That’s clearly unethical and it might be illegal. (UPDATE: Mackey appears to have violated Regulation FD, which bans selective disclosure of information, according to investment banker and blogger Roger Ehrenberg.)
The sin is especially egregious if Mackey bought or sold stock in Whole Foods around the time he was using the Yahoo boards to move the stock price.
I sure hope the Securities and Exchange Commission is looking into this. And Whole Foods’ board should consider whether John Mackey really embodies the corporate values they purportedly hold dear.
And this from The American Statesman, an Austin TX newspaper at http://www.statesman.com/news/content/news/stories/nation/07/12/0712wholefoods.html
Harvey Pitt, former chairman of the Securities and Exchange Commission, told the Journal that the postings were “bizarre and ill-advised, even if it’s not illegal.”
Henry Hu, a securities law expert at the University of Texas Law School, stressed that he had not seen the postings but said they might raise two two core issues in securities regulations.
One is whether Mackey’s frequent participation in the message board would be of interest to an average investor and therefore should have been disclosed, and two, whether Mackey’s comments contained any material misstatements or omissions.
“It does raise the question of ‘Hey, should you have to disclose some of this kind of behavior?’ ” Hu said. “Does it reflect his integrity? Would you invest, you being a reasonable investor, if you knew that the CEO had posted these 1,000 (entries)?”
While it is “bizarre” and certainly “ill-advised” by the nutty legal society we live in, it does represent a certain creativity that doesn’t exist a most lawyer run corporations. We agree to EULAs every day that damn us to legal hell that no lawyer in his right mind would ever agree to, but we all do it just to use the software we paid for and need to even talk to our bank in our society. I don’t see that Mackey was attempting to do any thing to meaningful to effect the stock price of Whole Foods or Wild Oats as long as he maintained his anonymity and didn’t pass on any insider information. If you buy stock tips based on an anonymous blogger then you are no better than someone who listens to Cramer or any other talk outlet and doesn’t go do the home work. You get and deserve what you paid for. I do feel that the Feds obstruction is inconsistent at best and for the most part without merit in both the Whole Foods and Sirius/ XM cases. Mostly show trials to hide and distract us while the big fish get away.
Yeah, gotta hate those nutty laws like anti-trust and securities violations that prevent decent, innocent employers from just trying to make a buck. We know that without those laws the capitalists would act kindly toward their labor pool, the environment and society in general, as it’s inherent in the laissez-faire free market. The corporation is so humane by nature that we should even do away with all law that pertains to it, according to the book “Trapped: When Acting Ethically is Against the Law,†written by Georgetown University Professor John Hasnas and endorsed by John Mackey.
“And he [Mackey] has recently endorsed a book published by the libertarian Cato Institute whose author concludes that no corporation should ever be prosecuted for crimes – no matter the corporation, no matter the crime.†–http://www.infoshop.org/inews/article.php?story=2006062911473458
For one, Mackey was not anonymous on that blog; it seems most everyone knew it was him and he not only hinted at his identity but even admitted to it openly. So what you’re passing off as creativity was in fact a conflict of interest, especially in light of Mackey’s intent to buy WO. Even if he meant well it certainly gives the appearance of trying to drive down the stock price of a competitor with the motive of buying it cheap.
On top of that the documents in the FTC’s case reveal his motive to destroy the competition. Is that even a healthy capitalist agenda, given that competition is the savior of mankind? It sounds more like totalitarianism than capitalism. But the larger question is: Is this behaviour “integral?†What would an integral perspective say about the ethics of not only the message board behavior but the values of ruining your competition?
And another key question, one asked before, is to wonder if capitalism doesn’t have to be replaced by another form of economy in an integral perspective. Perhaps it tetra-enacted with the rational-egoic level of consciousness and perhaps its form is limited to that structure? So trying to “upgrade†the structure with so-called integral ideas might be like trying to make the old PacMan game do advanced CGI.
I wish Michel would weigh in on this. This issue is really right up his alley.
On the other hand I admire Mackey for the advances he’s made in his corporation, like fair labor practices, enviornmental concerns, capping executive salaries, etc. He’s implemented many so-called “green” advances. Which is why I’m a bit disheartened by this revelation. And wondering if one of its causes is trying to fit the round peg of such developmental advances into the square peg of libertarian capitalisitic forms.
Another issue is whether I-I and Zaadz will comment on this. Mackey is on the Board of I-I and has contributed financially to zaadz. I’m guessing he’s also invested in I-I but don’t know for sure. Hence I wonder if it’s “integral” to be transparent enough to criticize a financial investor who might’ve breached your ethical code? I’d really like to hear I-I and zaadz weigh in on their ethical codes and if this behavior transgresses it. Or exemplfies it?
And what do you, the reader think about an integral code of ethics as it relates to this news item?
i was interested to read that Mackey doesn’t give himself a salary. I’m sure he has plenty of income from other sources, but not knowing more, I’m willing to give him the benefit of doubt and conclude that maybe he is not motivated particularly strongly by money and everything it can buy (anyone who knows differently, feel free to weigh in here).
Yet he clearly is willing to cross or flirt with some ethical boundaries for the sake of his company. Why? I think much of it may be that he is very strongly identified with that company. Even if he is not overly driven by the need for great personal wealth, I think he is driven by the need to build a larger system that he can identify with. In this respect he would be like anyone who founds a community as a refuge from or alternative to the larger society, then works very hard to develop and defend it. If this view is correct, he is not trying, or at least not only trying, to enrich himself personally, but rather to create an alternative social system to embed himself in.
I think this kind of action is more integral than what motivates the typical CEO. Because he is a CEO, and because a company is involved, there are certainly the usual capitalistic elements involved, but maybe also some communal ones as well. Think of a spiritual community that tries to widen its influence–for that matter, think of I-I itself. I don’t think Wilber is motivated much by money. I think he is motivated to some extent by power–and I imagine Mackey is as well–but also by the vision of building a community around his own principles. We can debate the value of these principles, as well as the ethics of actions used to promote or defend them, but there is core there that transcends the traditional motives of those in business.
There has been surprisingly very little work done on Integral ethics by Ken or I-I. He has outlined the framework but not filled in the spaces.
One of the areas integral theory ought to examine is the current gap (gulf?) between personal and business ethics. People doing business will behave in ways they would not amongst family and friends. Current business ethics allows you to lie and strangely, there are laws to protect commercial confidentiality, in other words, to hide the lies.
I have said elsewhere that I think a basic ethical principle is to seek and tell the truth.
The theory of competition is that social benefit is a side effect. The free market libertarians argue (of course) that the market will sort the good from the bad and that society will benefit from the innovation and wealth created by a unrestrained market.
But this is naive idealism. There will never be a totally free market because in a totally free market by niece could sell her under age body instead of working for a fast food chain (or sell drugs, etc). I have never heard a market libertarian argue for child prostitution, child labour or an unrestrained drug market. In other words, even the most extreme market libertarian accepts the need for some control. The question then is really about how much control?
Edward is quite right of course. The history of capitalism is also a history of corporate criminality. If they could get away with it, they would. I forget who it was who said it, but they were right – war is a form of economics. Ultimately all wars are about economics, about securing markets, for oil, for salt, for opium. The history of British imperialism is the history of ‘corporations’ like the British East India Company. What about the Opium wars? Wars fought to force the Chinese to open their country to British opium grown in the British colonies of greater India by the BEIC. Not to mention the link between legitimate business and criminal gangs – the line between legal and illegal business is very muddy, a prime example being tyx evasion by using off-shore banks.
The reasons current laws were introduced was to correct the gross and unethical behaviour of past corporate thugs and criminals.
It was obvious to me when I met several I-I folks that there is a definite ‘market libertarian’ faction within I-I. I actually stayed with one, Michael Ostrolenk, in Washington DC and he took me to, of all things, a meeting of the Republican party libertarian cuacus (headed by representative Ron Paul, who’s offices I also visited). Michael was a lovely and generous guide, but we did have some interesting conversations where I challenged his market libertarianism (which he may now have moved beyond).
Market libertarianism is dangerous. In Australia they are in the pay of some large corporations and are behind the climate change denial movement, because it involves more legislation.
Of course these ‘integral’ market libertarians believe that integral theory supports their position. I would argue that it does not. As Edward suggests I think it actually supports a revised form of socialism. This is of course a massive topic that deserves a book to fully explicate, and probably a rather big book. I attempted to begin to frame the debate in ‘Notes Towards an Integral Political Economy’. Please note I said ‘begin’ to frame the debate. I was actually horrified at the size of the task I had attempted to start. In any case, you cannot separate the question of ethics from an integral political economy.
The structure of corporations was based on greed. The industrial age enabled humans to exploit the earth’s resources and huge fortunes were made. There was, and still is, an enormous greed for luxury and ethics was an impediment. I don’t blame the rich because even the poor made ethical compromises. The greed revolution was a collective decision. Yes, there were individuals who made enormous wealth and who led shamefully extravagant lifestyles, but there were enough poor who admired the rich and simply wanted to be rich themselves. In other words, there was individual greed and collective and national greed. This greed allowed people to destroy someone else in order to become wealthy. In fact wealth became good in itself.
This will change in the mid to late 21st century as greed crashes against the reality of finite resources.
Btw, anyone concerned about ‘Western’ imperialism in developing nations ought to investigate the actions of Chinese mining companies in Africa. They are perhaps worse because they are even less governed by ethics than Western mining corporations, if that is possible. In the Congo they pay miners a pittance and turn a blind eye to child labour. As the Chinese economy booms they will acquire the capital to begin to buy Western based corporations. This process has already begun. The Chinese legal system has nowhere near the same protections as Western countries and so Chinese corporations will be able to get away with all sorts of dodgy practices. Indeed, they do already. China has very little in the way of environmental protection and this means the death of hundreds of thousands of Chinese every year from pollution. Corruption is also a big problem. China just executed the government official in charge of approving medicines for accepting bribes to ignore dodgy practices that led to the death of thousands. And America is realising that corrupt Chinese practices have resulted in contaminated products being exported there.
Now imagine how much worse the Chinese would be if there were absolutely no constraints at all?
Corporations are not the cause of greed and greed will certainly not abate if and when we come up against a wall of finite resources. Greed is merely a common attribute of life forms (though I will grant that a petunia probably doesn’t react emotionally to the wrestling match going on at root level with other plantlife for clumps of soil).
When someone is in the clutches of greed, it is a disqualifier for any real 2nd tier. It may qualify for Wilbergral 2nd tier. It may get you into the Wilbergral Clear vMeme and Hall of Fame and, certainly, not get you bounced from the I-I Board, but it is an anti-indicator of spiritual advancement. It pretty much means you’re a jerk.
John Mackey was acting unethically when he posted his hundreds of messages and he has to have known it because he is neither stupid nor a neophite to the business world. Whether the effect of what he did was niggling or ginormous [the word's in the dictionary now], it doesn’t matter. His actions were truth-skewing and he regaled in the activity.
John Mackey is pond scum. He should be sent away to wherever I-I has put Marc Gafni.
No one is saying corporations cause greed, they have been shaped by a greed that ignores good ethics.
Hi,
I’m not sure I’m the Michel being referred too, with this topic being in my alley? I hadn’t followed this blog, nor the Whole Foods evolution, so I do not feel particularly expert. However, I recommend reading the Food Issue of the Nation that appeared last year in September. This article here, at http://www.thenation.com/doc/20060911/mello/6, focuses on the labor practices of the organic farming industry, which are dismal, with the workers themselves unable to buy any organic food. Without especially singling out Whole Foods, the article is rather a critique of the selfish attitude of privileged consumers only thinking about their own family, it does mention that WF refuses fair trade certifications, which I think is certainly worth critiquing. If we are integral, then does this not dictate to also include a concern for those that produce the food. Fair trade, to my mind, is the market mechanism subjected to peer arbitrage, i.e. seeing all stakeholders as partners, and therefore, a step higher in integral ethics, than a mere capitalist market, which is not just based on greed, but on its institutionalization (and that’s how it differs with earlier modes of production, and hopefully, with later ones), and also in fact, on power relationships, which dictate that the producers of coffee will be poor (and not just a question of supply and demand, as the theory would suggest).
I found this quote, from http://www.michaelpollan.com/press.php?id=66, which summarizes the issue of ‘where the organic food comes from’, and of some of the negative effects of scale as introduced by Whole Foods:
“Thanks to his perch as The New York Times Magazine’s resident food sage, Pollan is a well-known champion of the ethical superiority of small, local organic farms, and of the superior taste of their products. Whole Foods, of course, is a bringer of organic food to grateful yuppies across the country. In The Omnivore’s Dilemma, Pollan describes Whole Foods as the embodiment of “Industrial Organic.†The company’s appetite for product has driven some organic farmers to scale up and become very much like the farms they were supposed to replace: organic dairies now house thousands of cows who have never munched on a patch of grass, while Brobdignagian vegetable farms ship their produce across the country, undercutting small, local farmers. Whole Foods even sells “organic†TV dinners (Pollan says one he tried “looked and tasted very much like airline foodâ€Â) and, during the North American winter, has asparagus shipped north from Argentina. This would be environmentally dubious on its face, Pollan suggests, given the fuel required to ship the vegetable. In any case, it “tasted like damp cardboard.â€Â
Mackey immediately fired back. In an open letter on the Whole Foods Web site, he said his company was committed to local farmers as well as consumer choice, and he charged that Pollan’s blanket condemnation of large farms undersold the benefits of encouraging big agriculture to eschew pesticides. The dispute culminated in February, when two thousand people paid $10 each to see a debate between Pollan and Mackey at the University of California at Berkeley. For those expecting an interenviro cage match it was anticlimactic, but Mackey did seem genuinely concerned that the industrial-organic label was going to stick to and hurt Whole Foods, despite its $5.6 billion in sales last year, and 19 percent growth.”
As to an integral ethical response to Mackey’s behavior, here’s an interesting quote from elementstew at the relatively new Integral Life Practice blog, in their Integral Ethics discussion board: http://pods.zaadz.com/integral_life_practice/discussions/view/142877
“It seems so fitting that there have been no posts here. The integral subculture seems ethically challenged, morally confused or perhaps simply cowardly.â€Â
“No one is saying corporations cause greed, they have been shaped by a greed that ignores good ethics.”
The key is easy: A mixed economy that gets the incentives right. There very much needs to be free capitalism to suit the greedheads, to inspire them to be efficient and creative, but with regulation, too, and penalties that sting and tax rates that balance in fairness and economic justice.
So we’re expecting modern CEOs to be integral? Is that really reasonable? Mackey did some dodgy stuff and presumably will get nailed for it- good.
I guess I see a lot of modern business practices as the game that developed after we started to “generate enough food not to have to kill each other over it directly.” If we accept the idea of integral stretching down to that base of a level, I think that it hints at something fundamental. Tribalism- killing to feed yourself and family, killing to protect your family, working to support your family. Trying to secure your family’s future. Millions of us trying to do that without killing each other too often in the process. Higher states of conciousness must always integrate this. The word “greed” hits me in the same way that the word “racism” does. Both are real, and a bane to society, but both are bandied about in a way that ignores their fundamental mechanics. (We also shouldn’t forget the level of perspective that Ray was trying to bring when he talked about the Chinese earlier.)
Matthew said: “So we’re expecting modern CEOs to be integral? Is that really reasonable?”
It is reasonable if they espouse integral ideas on their company blog and sit on the board of I-I. Otherwise no.
And let me reiterate: I much respect Mackey for many of the more “liberal” practices he’s instituted in his company. But there’s still a long way to go.
I don’t think that any of us live completely up to our own ideals of integral. He let his ego, or whatever, get in the way of common sense, but what does that have to do with being integral? Are you worried that this demonstrates that Ken’s ideas are flawed somehow? Or is this more of a standing commentary on I-I?
No, I”m not suggesting any such thing. I am hoping that if one doesn’t live up to their, and their group’s, code of ethics that that person, and the group, recognize it as such and take appropriate action. There are clear codes of conduct and ethics for lawyers, for example, and appropriate punishments from a light verbal reprimand up to disbarment. Granted “integral” has yet to elucidate such a code of ethics but this could be a prime opportunity to expand on it.
As an update, it appears the SEC is doing an informal inquiry into the legality of Mackey’s behavior. There have also been rumors that WF’s Board might take some action. Here are some examples of what I’m talking about. So I’m not holding I-I to any higher standard, just a “reasonable” expectation.
Here’s a comment on the issue by donwingate in the I-I forum “What’s up with John Mackey†at
http://multiplex.integralinstitute.org/Public/cs/forums/thread/25674.aspx:
It will be interesting to see what the fallout is.
Everyone is quick to jump on the ethical issue. But what is the ethical issue in play? Is it a question of whether or not he broke the law? (Which we will have to wait and find out about.) Or is there a bigger issue of fair play, hitting above the belt, etc? Or, are we more concerned about Whole Foods stake holders, and how their investment will be affected by what he did. Do we admire what John Mackey did, and fault him only for getting caught, or are we appalled that he would take such a risk to begin with? All of these are important and will be looked at, no doubt.
Personally, I reacted most strongly to the potential for negative fallout. Regardless of whether he did anything illegal or unethical (as in unethical business practices) it seems to me like it should be obvious that this is the kind of thing could blow up in all kinds of negative ways. So it just seems stupid. This is the same reaction I had to Clinton. It was like, how could you be so STUPID!!! (As for the ethicality of Clinton’s indiscretions in terms of how they affected others, a case could be made that it cost Al Gore the election. What’s between him and his wife is their business.)
It would be interesting to know what Mr. Mackey’s conscious intentions were. It went on for 8 years, so definitely not a case of temporary insanity. Was it a deliberate and imaginative attempt to affect the market, as jikishin is saying? Or was it more of an entertainment, or as a way to wind down after work? Or both perhaps. I wonder, if he was deliberately trying to affect the market, how serious was he and how much of an effect did he believe he could have. Conversely, I wonder, if he was acting only for his personal reasons, to what degree did he believe his actions could not possibly have any meaningful effect in the big scheme of things.
We’d have to ask John Mackey himself if we want to know his conscious motivations. And, there may be some extent to which he doesn’t know why he did it. What about his unconscious motivations? What shadow material is in play here, if any?
Well, maybe shadow isn’t significantly involved. It is possible that, whatever the reasons, he knew exactly what he was doing, that he looked at the potential benefits and risks, and made a calculated decision. If this is the case, then the first thing to be noted is something Ken Wilber talked about (where was that…???) how very successful people – CEO’s and Presidents – are so used to succeeding that they can be blind to their own fallibility. An “I can do no wrong†syndrome. (Question: is this in itself a shadow symptom?)
If this is the case though, the question comes up: how can someone who is held up as a model for his ability to create a Green/Teal business (in the best sense) could do something so, well, Orange. One answer is: of course he has strong orange, strong orange is necessary for success as a CEO. This argument would say that he did what his orange self thought was best for the company. It might go further and say green should stay out of business decisions, especially when it comes to the competitive part of it, and leave orange decisions to orange. No contradiction.
And a possible response to that would be: why then the seeming underhandedness, compulsive secretiveness. The very nature of what he did – anonymously taking on an alter-ego to say things he would not be able to say as himself – in a very literal sense invokes images of shadow.
And this brings me to the orange shadow. Because it is such an obvious setup. A guy evolves through green and surprise, surprise suppresses a certain amount of orange self in the process. Moving up into second tier he creates a successful business founded squarely on green principles. In order for the company to succeed he calls on his orange self (the part that isn’t suppressed) and is remarkably successful. Really, really successful. The kind of success that could mess with orange, make it think it is something special. Healthy orange is still ok. It’s doing its job well and there is a boss who’s making the decisions – the CEO. But the success bothers green (green influences coming from both the UL and LL) and it starts worrying, complaining, accusing, which is of course a real problem for orange. More suppression of orange, a deep schism forms. Meanwhile, the suppressed orange self is all hot and bothered. All this power, energy coming in and nothing to do, no way to release it. It needs a way to express itself. So it invents one….
Is this John Mackey? Honestly, I don’t know.
Mackey issued an apology today at the WF website: http://www.wholefoodsmarket.com/company/pr_07-17-07b.html
The WF Board is launching an independent investigation: http://www.wholefoodsmarket.com/company/pr_07-17-07a.html
The SEC contacted WF about an inquiry into the situation: http://www.wholefoodsmarket.com/investor/pr07-07-17.html
Whole Foods Market Code of Conduct and Ethics
http://www.wholefoodsmarket.com/investor/corporategovernance/codeofconduct.pdf
1.0
Introduction – The following is applicable to all Whole Foods Market (WFM) Team Members and Directors. This code of conduct/ethics is intended to describe situations creating an actual, potential or perceived conflict of interest for WFM Team Members, Directors and their immediate families, and set forth the Company’s policy regarding those situations. A conflict of interest may exist if a Team Member’s or Director’s position or authority may be used to influence or make decisions that lead to any form of financial or personal gain for that Team Member or Director or member of his or her immediate family, and is not limited to the examples included in this policy.
The majority of this code, particularly parts pertaining specifically to executive officers and Directors, is based on the rules of governing bodies such as the Securities and Exchange Commission (SEC), the Nasdaq stock exchange, and the Financial Accounting Standards Board (FASB). This code will be made publicly available, in accordance with Nasdaq policy. Failure to comply with this code of conduct/ethics may subject a Team Member to immediate termination.
This code is intended to establish such standards as are reasonably necessary to promote: (1) honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; (2) full, fair, accurate, timely, and understandable disclosure in the periodic reports required to be filed by WFM; and (3) compliance with applicable governmental rules and regulations. While the situations described below illustrate ways in which conflicts may arise, the subject of conflicts of interest is so broad and complex that the avoidance of conflict basically rests with each person’s ethical standards, integrity and judgment. We recognize that situations may exist which are entirely proper and yet contain potential conflicts of interest or the appearance of a conflict of interest. In all such cases, it is the responsibility of the Team Member or Director to report anything that appears or could be construed as a conflict of interest, even if the Team Member or Director believes there is no wrong doing or actual conflict. When in doubt, report; always err on the side of disclosure.
I applaud the following: WF for having such a code and making it transparent to the public; WF for launching an internal investigation into the issue; Mackey for issuing an apology realizing his “error of judgment.†Part of this could be due to the SEC inquiring into the situation but I think WF and Mackey have highly developed values and are also in part motivated by them. Here’s hoping that this situation allows WF/Mackey to take the necessary and appropriate action in alignment with their values. It has certainly been, and will continue to be, a test of them.