Reference no: EM131365942

Persuasion and Ethics
Here's a statement by Warren Buffett, part of a cover letter to his company's directors. It accompanied his letter to stockholders. The priority is that all of us continue to zealously guard Berkshire's reputation. We can't be perfect but we can try to be.

As I've said in these memos for more than 25 years: "We can afford to lose money- even a lot of money. But we can't afford to lose reputation- even a shred of reputation." We must continue to measure every act against not only what is legal but also what we would be happy to have written about on the front page of a national newspaper in an article written by an unfriendly but intelligent reporter. Sometimes your associates will say, "Everybody else is doing it." This rationale is almost always a bad one if it is the main justification for a business action. It is totally unacceptable when evaluating a moral decision.

Whenever somebody offers that phrase as a rationale, in effect they are saying that they can't come up with a good reason. If anyone gives this explanation, tell them to try using it with a reporter or a judge and see how far it gets them.If you see anything whose propriety or legality causes you to hesitate, be sure to give me a call. However, it's very likely that if a given course of action evokes such hesitation, it's too close to the line and should be abandoned. There's plenty of money to be made in the center of the court.

1. Analyze: What do you think of Buffett's position? How would you feel if you received this message from your CEO? Does it feel like Buffett believes in what he's saying, rather than just giving lip service to a moral directive? How does the way he writes carry sincerity (or fail to)?

2. Note that not long after Buffett wrote thisletter, one of his top executives (and probable successor), David Sokol, was accused of unethical behavior (buying substantial stock in a company that Berkshire Hathaway was about to acquire). Sokol resigned, but Buffett's initial response, which didn't express much outrage, was widely criticized. He later called the violation of the rules and company ethics "inexcusable." Does this set of events alter your view of Buffett's letter? What does it suggest about the relationship between written ideals and actions in business? Other spheres? Research the events and statements this situation generated and write an opinionpiece, in blog or op-ed style, about what the episode "means" or how it should be seen.

3. Do you see any dangers in using persuasive techniques to accomplish business purposes? What examples of unethical use come to mind in what you've observed or have read about?

4. Identify a specific example of unethical use of persuasion strategies you find interesting in any realm. Analyze why you believe the tactics were unethical. Then present your thinking to the class or group in three to five minutes. After hearing from all participants, collaborate with the group to draft a set of guidelines for the ethical use of persuasive techniques.