Culture and Stakeholders

There are a lot of organizations that don’t really give a damn about their stakeholders if we define stakeholders as employees, investors and shareholders, the communities where they conduct business, customers, and partners and suppliers. I could go into a rant about BP and probably make a pretty good argument that they don’t care much about the communities where they conduct operations. After all their track record is pretty poor given the number of fines they’ve paid due to safety and environmental negligence in the past. But I think it is more interesting to consider other companies that display neglect in more obvious fashion.

An April accident at the Massey Energy Upper Big Branch Coal Mine resulted in the deaths of 29 of their employees. The accident was the worst mine incident since the early 70’s in the United States. Coal mining is dangerous as over 15,000 people have been killed in mining accidents since the mid-1800s in the US alone. While many of the mining operations are focused on creating the safest environment possible given the inherent dangers, Massey Energy doesn’t appear to be a company that truly cares. An investigation by NPR has found that methane monitors were frequently circumvented in order to avoid disruption of production at the Upper Big Branch Mine. This might have been what caused the explosion back in April. If production supervisors were so focused on production that they disregarded safety regulations, it probably means that the company culture was much more interested in making the days production numbers than taking care of their employees.

The Catholic church might be the best example of how an organization’s culture is out of sync with stakeholder needs. The Vatican just published a new set of guidelines that extends the statue of limitations for sex abuse allegations among other minor changes to how abusive priests are disciplined. But the changes don’t require church officials to report sexual abuse allegations to civil authorities. It seems the Catholic Church is much more interested in protecting priests than in protecting patrons. They are interested in stakeholders just not as much in some stakeholders as others.

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